Sandy Aid Runs Into Republican Demands for Spending Cuts

Photographer: Win McNamee/Getty Images

House Speaker John Boehner on Jan. 1 blocked House action on Sandy-aid legislation because of unease among his Republican colleagues about the $60 billion price tag. Close

House Speaker John Boehner on Jan. 1 blocked House action on Sandy-aid legislation... Read More

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Photographer: Win McNamee/Getty Images

House Speaker John Boehner on Jan. 1 blocked House action on Sandy-aid legislation because of unease among his Republican colleagues about the $60 billion price tag.

Increasing numbers of House Republicans want to link disaster relief to spending cuts or changes to aid programs, complicating efforts to provide assistance to Hurricane Sandy victims.

The issue already has caused a political embarrassment for Republicans, and it takes center stage again next week when the House is scheduled to vote Jan. 15 on a second installment of Sandy-related aid.

Congress traditionally has treated disaster assistance as emergency spending that doesn’t require offsetting budget savings. Days after Hurricane Katrina hit New Orleans and the Gulf Coast in 2005, Congress appropriated more than $60 billion in aid with little opposition.

By contrast, House Speaker John Boehner on Jan. 1 blocked House action on Sandy-aid legislation because of unease among his Republican colleagues about the $60 billion price tag. After protests by New Jersey and New York Republicans whose constituents were among those hit hardest by the Oct. 29 storm, Boehner scheduled a Jan. 4 vote and lawmakers passed a first installment of $9.7 billion in help.

“Emergency bills like this should not come to the floor without offsets to pay for it or structural reforms,” Representative Jeb Hensarling, a Texas Republican and chairman of the Financial Services Committee, said during debate on the measure, which allowed the nation’s flood-insurance fund to continue paying claims from the region.

Debt Limit

Hensarling’s comments and the delay in delivering aid to victims of one of the worst natural disasters in U.S. history underscore how deficit-conscious Republicans are taking a stand against spending increases -- including emergency relief. They also foreshadow how Republicans will insist on spending cuts in exchange for an increase in the government’s $16.4 trillion debt limit next month.

The votes that Boehner, an Ohio Republican, has scheduled for Jan. 15 would deliver two more installments in Sandy-related aid. One would provide $17 billion for immediate needs, and the other would allocate $33.6 billion for long-range projects that include improvements to buildings, coastlines and subway tunnels to prevent future flooding.

To pass the full package, House Republican leaders will be counting on fellow party members from the U.S. Northeast and the Gulf Coast, which has received billions of dollars in emergency aid since Katrina, to join Democrats in supporting the bill.

Amendments Invited

Still, the leadership has invited amendments, which could give lawmakers the opportunity to seek spending offsets. The legislation is H.R. 152.

Some Republicans are complaining about the $33.6 billion measure, saying that the money won’t go toward the emergency needs of residents whose homes and businesses were destroyed by the storm, which killed more than 125 people.

“It would be hard for me to imagine voting for it” said Representative Mike Pompeo, a Kansas Republican.

The package includes $19.7 billion to repair rail and urban transit infrastructure, as well as to finance the rebuilding of public hospitals, electric and gas utility facilities and roads.

The “two-vote approach” may give members a chance to “split the baby,” said Representative Tom Cole, an Oklahoma Republican.

Republican Representative Jack Kingston of Georgia said the $17 billion package “is going to happen.” He also predicted that Northeast Republicans and “enough sympathetic” Republicans will likely team up with Democrats to pass the bigger package of long-term aid.

States’ Share

Some Republicans may seek long-range changes to funding relief efforts that include privatizing the flood insurance program. Also being discussed is increasing the 25 percent share of disaster-relief costs paid by states.

“We have to have a policy that incentivizes governors and mayors to set aside” more money for emergencies, said Matt A. Mayer, who oversaw Katrina aid at the Homeland Security Department. He now studies disaster policy at the Heritage Foundation, a Washington-based pro-Republican advocacy group.

The debate over requiring offsets for disaster spending contrasts with the passage of past emergency funding bills. After Katrina struck the Gulf Coast and unleashed major flooding in New Orleans, then-President George W. Bush called Congress into emergency session.

Unanimous Vote

Lawmakers passed $10.1 billion in aid, with a unanimous vote in the House. A week later Congress appropriated another $50.8 billion, with only 11 Republican no votes. By 2008, that amount had ballooned into $107 billion for highway reconstruction, small business loans, levee reconstruction and other projects, most of which wasn’t covered by spending cuts or revenue elsewhere in the budget.

Other spending that wasn’t offset in recent years and contributed to expansion of the U.S. budget deficit -- including for the wars in Iraq and Afghanistan -- sharpened the determination of many Republicans to put the brakes on further emergency expenditures.

“The deficit is driving it more than anything else,” said Cole. Opposition to emergency spending without offsets is “something that’s been gathering speed for a while,” he said.

The drive for offsets surfaced in 2011 as Congress and President Barack Obama haggled over demands by Republicans for spending cuts to match an increase in the government’s borrowing authority.

Joplin, Missouri

After a tornado hit Joplin, Missouri, in May 2011, House Majority Leader Eric Cantor, a Virginia Republican, said federal disaster aid should be offset. He reiterated that stance after a hurricane tore through Virginia a few months later as it moved up the East Coast.

Cantor’s comments drew criticism from local officials in his own congressional district after a 5.8-magnitude earthquake centered there destroyed more than 30 homes and closed two schools. Still, he and other top Republicans pushed to partially offset $3.6 billion in emergency spending for victims of the various disasters.

A coalition of Democrats angered at $1.5 billion in cuts to a green-technology program and Republicans concerned about the extra spending killed the measure. Several months later, Congress passed emergency spending that had grown to $8.1 billion.

Domestic Programs

That relief bill passed the House only because offset proponents were allowed to offer a resolution calling for a 1.83 percent cut to non-military domestic programs. The resolution didn’t advance in the Senate.

This year, Cantor has drawn praise from New York Democratic Senator Charles Schumer for his work on the Hurricane Sandy measure.

Boehner’s decision last week to stymie the $60 billion in Sandy aid came after Congress had voted to avert tax increases for most Americans and postponed for two months $110 billion in automatic spending cuts.

“He really didn’t have much political capital left because of this feeling by a number of conservatives” that the hurricane aid had to be offset, said Steve LaTourette, an Ohio Republican who didn’t seek re-election to his House seat and left office last week.

Republicans criticized the Senate bill for containing money for extraneous projects, such as helping reforestation in Colorado and promoting Alaskan fisheries.

‘Pork’ in Bill

“None of that pork we’re talking about is in New York, New Jersey or Connecticut,” said Representative Darrell Issa, a California Republican.

New Jersey Republican Governor Chris Christie, who called Boehner’s decision to block the aid vote “disappointing and disgusting,” made clear his frustration over the delay in his state-of-the-state address to the New Jersey legislature on Jan. 8 in Trenton.

“We as a state waited 72 days, seven times longer than the victims of Hurricane Katrina” for federal assistance, Christie told lawmakers. “I hope New Jerseyans, both Republican and Democrat, will never stand silent when our citizens are being short-changed.”

To contact the reporter on this story: James Rowley in Washington at jarowley@bloomberg.net

To contact the editor responsible for this story: Jodi Schneider at jschneider50@bloomberg.net

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