Senate Takes First Step in Budget Reconciliation Process

On August 11, the Senate passed a budget resolution along party lines, 50-49, setting the stage for Congress to consider a $3.5 trillion reconciliation package. Majority Leader Steny Hoyer, D-MD, will reconvene the House of Representatives the week of August 23 to consider the resolution, cutting into the August recess for the chamber.

The package includes numerous priorities of the Biden administration’s America’s Families Plan, including expanded paid family and medical leave, which would likely extend to federal employees. The resolution also recommends expanding Medicare benefits to include vision, hearing and dental, and proposes lowering the Medicare eligibility age to 60, as well as providing tuition-free community college, universal Pre-K and more.

Annual budget resolutions provide a blueprint for total spending, revenues and debt. The budget measure directs congressional committees in both chambers to recommend changes to the law to achieve the provisions set out by the budget resolution by September 15. Congress will then incorporate the committees’ policies into a reconciliation bill, which will then be considered by both chambers.

With passage of the resolution, Democrats took the first step in the budget reconciliation process, which allows bills in the Senate to pass with just a simple majority, bypassing the usual 60-vote threshold and the filibuster. In the current session of Congress, Democrats hold a slim majority in the Senate, 50-50, with Vice President Kamala Harris serving as any tie-breaking vote between the evenly divided parties. With 51 votes in the Senate, Democrats can utilize budget reconciliation to pass legislation without Republican support.

While undoubtedly a useful tool to pass spending and revenue bills without full cooperation between parties, budget reconciliation cannot be used to pass every type of policy. The Byrd rule, proposed by former Senator Robert Byrd, D-WV, and adopted by Congress in 1985, codifies the constraints of the reconciliation process. The Senate parliamentarian enforces these restrictions, and usually makes the final decision on which provisions can be included in a reconciliation bill. The Byrd rule requires that legislation passed through reconciliation must have a budgetary impact and change federal spending or revenue.

Furthermore, legislation passed through reconciliation cannot be projected to increase the federal deficit beyond ten years, only within a decade. Notably, reconciliation bills cannot change or impact Social Security in any way, meaning some of NARFE’s legislative priorities – like repeal or reform of the Windfall Elimination Provision and Government Pension Offset or changing how cost-of-living adjustments are calculated – could not be included in a reconciliation package.