Negotiations between the House and Senate on the FY 2002 supplemental spending bill (H.R. 4775) broke down after the White House threatened to veto the bill if spending was much more than the $28.8 billion requested by the President and consisted primarily of spending for defense and national security and aid to New York City.

Appropriators had agreed on at $30.4 billion supplemental. Ironically, in order to cut costs, the conference agreement finally reached on July 19th completely cut funding for the Workforce Investment Act (to restore the rescission of funding for dislocated workers passed last July and to provide additional funds for National Emergency Grants)—funding that the President had requested, and the House and Senate had both approved.

It is likely that the same Presidential veto threat against “excess” spending will make the appropriations process as a whole even more difficult than usual. The House is operating under its own budget resolution limiting appropriations to $759 billion to be divided among the thirteen spending bills. The Senate has not passed a budget resolution, but there has been agreement for discretionary spending in the amount of $768 billion. Besides the funding level discrepancies and the threat of Presidential veto, the creation of the “Department of Homeland Security” will likely cause more delays as appropriation committee jurisdiction is determined.