The Bush administration is putting the finishing touches on another Katrina spending relief bill tonight and it is expected on Capitol Hill tomorrow. Early reports indicate the bill will propose to use up to $17 billion in already appropriated funds to begin reconstruction of federal facilities damanged by the hurricanes. Although there is still a substantial amount of the previously appropriated $62 billion in relief funds left to be spent, federal rules prohibit that money from being spent on other projects, such as repairs of military bases, highways, and other federal infrastructure. The Associated Press reports the shift in funds would most likely be used for "repairs to Interstate 10 in Mississippi and Louisiana and Keesler Air Force Base in Mississippi." AP: White House Readies New Hurricane Request

The Congressional Budget Office has prepared a report estimating the budgetary effects of the Finance Committee's reconciliation recommendations. The CBO found that, overall, the committee's recommendations would generate $819 million worth of "savings" in 2006. In 2007, however, because they suggest delaying Medicare payments one year, the proposal would actually end up costing over $4.5 billion. The net cuts from 2006-2010 are estimated to be $10 billion. This is an impressive amount for lawmakers who are particularly worried about excessive government spending; however the amount is dwarfed by the amount the government is spending for the 2001 and 2003 tax cuts this year alone: $225 billion. It seems like it would make more sense to repeal some of this cost in looking for "savings," in government expenditures, rather than cut corners in programs that serve millions of people.

House and Senate appropriators have mapped out a plan for finishing work on all 11 appropriations bills before Thanksgiving, however there is some speculation that reconciliation will force GOP leaders to work slowly on appropriations to keep pressure on members to stay in town into December to complete other unfinished business. Congressional conferees are expected to wrap up work on the FY 2006 Agriculture spending bill this week, and if all goes according to plans, appropriators may complete negotiations on a $30.5 billion FY06 Energy and Water bill this week. The week of November 7 they are hoping to complete work on the Defense spending bill (including $50 billion for overseas military operations), as well as the Science-State-Justice-Commerce and Military Quality of Life measures. Their ambitious plan also includes passage of the Labor-HHS and Transportation-Treasury bills the week before Thanksgiving, as well as a short-term continuing resolution (the current CR expires Nov. 18) to give President Bush time to sign remaining spending bills into law. We'll see if they will actually be able to come to a consensus on reconciliation and tackle all of this approps work in the weeks ahead.

The House will set to work on the reconciliation budget bill tomorrow, with markups in eight separate committees. The Energy and Commerce Committee will be looking to trim as much as $12 billion from Medicaid over five years. These cuts could be problematic for some members of the Energy and Commerce Committee Republicans such Rep. Heather Wilson (R-NM), who was responsible for sending a letter to Budget Committee Chairman Jim Nussle back in April, asking him to remove reductions to Medicaid in the reconciliation instructions. The letter was signed by 43 other Republicans, including former leader Tom Delay, Speaker Dennis Hastert, and House Whip Roy Blunt. The cuts to Medicaid which would be included in the House budget reconciliation bill would, unlike the Senate Finance Committee proposal, hit Medicaid beneficiaries directly. The House reconciliation instructions will also look at ANWR, offshore drilling, and LIHEAP funding. According to BNA, on Wednesday and Thursday of this week two House committees "plan to mark up language that would open the Arctic National Wildlife Refuge, expand offshore oil and gas exploration, and increase federal assistance to low-income families that need help paying their winter heating bills." Opening the ANWR coastal plain to oil and gas leasing is projected to raise $2.4 billion over five years (although this money is not guaranteed), yet will have a number of environmental consequences and do little to alleviate national dependancy on oil. House Energy and Commerce Committee Chair Joe Barton (R-TX) also plans to ask for an extra $1 billion to fund LIHEAP, which provides heating and cooling assistance to one out every five American families. In the Senate there have been two amendments to increase LIHEAP funding by $3.1 billion. Each of the two votes, which were procedural, have been rejected; however in anticipation of a 50 percent increase in heating bills many will be experiencing this winter, it is almost certain funding will go up significantly. The White House is expected to request a third supplemental spending bill for hurricane recovery by the end of this week, and that could potentially be a vehicle through which LIHEAP funding could be increased.