House panel backs bill extending the federal pay freeze another year

Rep. Norman Dicks of Washington is optimistic some funding will be restored before the bill is enacted. Rep. Norman Dicks of Washington is optimistic some funding will be restored before the bill is enacted. Jose Luis Magana/AP

A House subcommittee approved a fiscal 2013 spending bill Wednesday that would extend the two-year pay freeze for federal employees and cut spending severely enough to potentially result in additional Internal Revenue Service employee buyouts, according to one lawmaker.

The House Appropriations Financial Services Subcommittee approved by voice vote a $21.2 billion spending bill that would effectively freeze federal employees’ salaries for the third year in a row, since it does not include the 0.5 percent pay raise President Obama requested in his fiscal 2013 budget.

Overall, the Financial Services appropriations bill is $376 million below fiscal 2012 spending levels and $2 billion below the Obama administration’s fiscal 2013 request.

“In this and other appropriations bills, the House is following the ill-advised path of the budget resolution passed by the House that threatens the vital services by severely underfunding federal agencies,” National Treasury Employees Union President Colleen Kelley said Wednesday.

The union objected to the bill’s IRS provisions, which would freeze the agency’s funding at the fiscal 2012 level of $11.8 billion and fall short of the administration’s fiscal 2013 request by $944.5 million. Rep. Norman Dicks, D-Wash., told the subcommittee these funding levels could result in additional rounds of employee buyouts. More than 1,000 IRS employees took buyouts in fiscal 2011.

“Thus, fewer audits will be performed, more tax cheats will get away,” Dicks said. This would increase the deficit, he added.

Dicks, the ranking member of the full House Appropriations Committee, also noted the overall bill is $1.8 billion below the Senate’s version and said he expects the final enacted law “to come in at much higher levels.”

The bill also was $195 million below President Obama’s request for the Securities and Exchange Commission, funding the agency at $1.4 billion. “In the wake of ongoing Wall Street regulatory issues, it is unconscionable not to provide the SEC with the resources it needs to protect investors,” Kelley said.

Labor unions took another hit in the House subcommittee’s version of the spending bill -- it does not include the moratorium on agency competitions for work pitting federal agencies against contractors, known as A-76 studies. The Obama administration supports the prohibition, and it was included in the fiscal 2012 Financial Services appropriations bill.

“This would allow agencies to push work through a broken competitive sourcing process that is not fair to the federal workforce and does not hold contractors accountable to taxpayers,” Kelley said.

The subcommittee also approved cuts in the General Services Administration’s budget for administrative expenses and for its Federal Buildings Fund, and lawmakers included provisions to strengthen oversight in the wake of the agency’s conference spending scandal. The bill would require quarterly spending reports; limit cash awards to GSA employees; prohibit all travel and conferences that do not comply with the law or regulations; and call for an inspector general report on travel, conference and employee award procedures, according to a committee summary.

The measure now awaits consideration by the full House Appropriations Committee.

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