White House spending cuts target DOE auto loan program

Source: George Cahlink, E&E News reporter • Posted: Tuesday, May 8, 2018

Nearly a third of the anticipated $15 billion in spending cuts the White House is proposing to Congress today would come from Energy Department technology loans programs, including one aimed at creating more fuel-efficient vehicles.

A senior administration official told reporters yesterday the plan would seek to cut the remaining $4.3 billion in unused funding for DOE’s Advanced Technology Vehicles Manufacturing loan program.

The $25 billion initiative — part of an Obama-era economic aid package to help domestic automakers — has not made any loans since 2011, making them “good targets” for cuts, the official said.

Similarly, the request will propose to eliminate $523 million from DOE’s Title XVII innovative technology loan guarantee program, which the administration said also has not made any loans since 2011.

The program sought to provide capital for large renewable energy projects, among them the failed solar startup Solyndra.

Other proposed cuts include:

  • $107 million in Superstorm Sandy aid for developing emergency watershed management plans. The administration said local communities have signaled they are not planning to fund their share of the effort.
  • $7 billion for the Children’s Health Insurance Program (CHIP), mainly through cuts to a contingency fund.
  • $252 million to fight the Ebola outbreak, money the administration says is no longer needed as the virus has largely been eradicated.
  • $133 million for a railroad employee unemployment program that Congress has not authorized in more than five years.
  • $148 million for the Animal and Plant Health Inspection Service to combat outbreaks of certain diseases that are no longer considered threats.

A detailed breakdown of the cuts to domestic spending, known as rescissions, will be sent to Congress today.

All told, the request would cut some $15 billion in unobligated spending from past years, although it would not cut any fiscal 2018 spending.

The administration official said the White House would eventually propose reductions for fiscal 2018 but declined to say at what level or when those cuts might be offered.

Under federal law, the administration can propose a rescission that freezes already-approved spending, with Congress getting 45 days to back the cuts. If lawmakers do not act, the funding is restored.

Rescissions are a regular feature of the federal budgeting process, although the money is often redirected to other more urgent priorities. In this case, the White House wants Congress to simply approve the cuts to save money, a move that it says Capitol Hill has not backed since the Clinton administration.

Prospects for the plan

The administration official, who spoke to reporters last evening on background, believes there is strong support for moving the package in the House and said talks are ongoing in the Senate. Under budget rules, the package cannot be filibustered in the Senate, meaning it could advance by a simple majority.

House Majority Leader Kevin McCarthy (R-Calif.), in an op-ed yesterday in the Washington Examiner, cheered on the White House’s recession push.

“To be sure, cutting wasteful spending should not be a partisan exercise,” said McCarthy, who added that since the mid-1970s, rescissions have eliminated $25 billion in wasteful spending under both Republican and Democratic presidents.

But signaling the opposition the package will face in the Senate, Minority Leader Chuck Schumer (D-N.Y.) sent out a statement yesterday blasting the plan after reports of the CHIP cuts surfaced.

Schumer said the proposal would “appease the most conservative special interests and [make the GOP] feel better about blowing up the deficit to give the wealthiest few and biggest corporations huge tax breaks.”

Conservative groups that were not pleased with this year’s budget deal backed the cuts and said they could go even deeper.

Americans for Prosperity, a group affiliated with the Koch brothers, said the rescissions would “start repairing some of the damage” done by the budget pact that increased domestic spending by tens of billions over the next two years. It called them a “last chance” for lawmakers to prove they can be fiscally responsible before the midterm elections.

The group also outlined its own cuts that could go as high as $45 billion, including reductions to wildfire programs, international disaster assistance, DOE energy research programs and a variety of federal science projects.