SUMMARY: The House and Senate Appropriations Committees approved their respective FY 2024 Financial Services and General Government appropriations bills, which funds several NTEU agencies.  Although the funding levels for agencies are vastly different under the bills, they both follow the President’s proposal for an average 5.2 percent pay increase for federal employees in 2024.

Yesterday, both the House and Senate Appropriations Committees approved their respective Financial Services and General Government (FSGG) appropriations bills, which determines funding for Treasury Department, including the IRS, SEC, and other NTEU-represented agencies and has jurisdiction over government-wide employee issues.  While the Senate FSGG bill passed with unanimous bipartisan support, the House FSGG bill passed in a party line vote after Democrats on the committee opposed the bill due to, among other things, the significant funding cuts included in the bill that go beyond the cuts agreed to in the debt limit deal last month. 

As you know, the President has proposed a 5.2 percent pay increase for federal employees for 2024, but his budget request was silent as to whether any amount is allocated for locality pay.  According to the Federal Employee Pay Comparability Act of 1990, federal employees should receive a 4.7 percent pay increase in 2024 before locality pay is added.  Both the House and Senate FSGG bills are silent on the issue of the pay increase, thus deferring to the President’s proposal of 5.2 percent.  NTEU will continue to work with Congress and the administration in support of the FAIR Act (H.R. 536/S. 124), which provides an average
8.7 percent increase consisting of a 4.7 percent across-the-board increase and an average
4.0 percent for locality pay. 

Both bills also continue the ban on funding new outsourcing activities under Office of Management and Budget Circular A-76, which is important given recent renewed calls by some in Congress to outsource additional federal jobs.

            Unlike the Senate bill, there are several government-wide provisions in the House bill that are strongly opposed by NTEU.  First is a provision that prohibits funding for federal agencies until they return to the level of telework and remote work as was the practice before the


lessons learned during the pandemic.  The bill makes no provision to fund the significant amount of additional taxpayer-leased office space that would be needed to implement this ill-advised requirement.  Second, the House bill prohibits the implementation of President Biden’s Executive Orders related to diversity, equity and inclusion in the federal workplace, setting back efforts to advance equal opportunity.  Third, the bill includes new language prohibiting funds for federal employees’ salaries if they unjustifiably refuse to comply with a valid congressional subpoena.  And finally, the House bill proposes drastic changes to the Thrift Savings Plan’s (TSP) mutual fund window (MFW) investment option by prohibiting MFW participants from investing in funds that use so-called “ESG investing” strategies (i.e., those that use environmental, social, and governance factors designed to promote societal good).  According to the TSP, such a change would require them to eliminate the MFW and deprive participants of a viable retirement investment tool that is available in the private sector.  NTEU will fight to ensure that these harmful provisions are not included in the final funding bill.

With regard to specific agency funding, the Senate bill would provide the IRS with
$12.3 billion for FY 2024, equal to the current level, but nearly $1.1 billion more than the House bill.  While funding for taxpayer services and operations support would remain at the current
FY 2023 enacted level in both the House and Senate bills, the Senate version would provide the agency with $1.2 billion more for enforcement.  Additionally, like the House bill, the Senate bill would rescind $10 billion of funding provided to the IRS under the Inflation Reduction Act (IRA) as required by the agreement to lift the debt ceiling last month.  While we are disappointed that IRS will lose critical funding provided by the IRA, we don’t expect the loss of this funding to have an impact on the IRS’s modernization plans in the short term.  However, we know any further reductions in funding would jeopardize the recent progress the agency has made in restoring taxpayer services and appreciate the Senate bill maintaining funding for the IRS at the current level.

In addition to providing funding for the IRS in FY 2024, the Senate and House bills contain several other IRS-related provisions of interest.  First, to help the agency continue to address the backlog, both bills would continue providing the IRS with limited direct hire authority.  Additionally, the Senate bill includes NTEU-supported language encouraging the agency to improve its use of competitive hiring and ensure adherence to the merit system when filling vacancies, and to not rely on the direct hire authority as its primary method of hiring.  Finally, the Senate bill directs the IRS to ensure existing employees are provided notice of vacant positions and opportunities to apply and requires the IRS to submit quarterly reports on its use of direct hire authority.

Both the House and Senate bills continue a provision that prohibits funds for giving bonuses to employees or hiring former employees without considering conduct and compliance with federal tax law.

For the Bureau of the Fiscal Service, the Senate bill would provide $386 million for
FY 2024, an increase of $14 million above the current level, and more than $18 million more than provided in the House bill, which had reduced funding for the Bureau from current levels.

            Several other NTEU-represented agencies would see increases under the Senate bill while facing cuts under the House bill.  Under the Senate bill, the Securities and Exchange Commission (SEC), which is funded through fees, would get a 9 percent increase, to $2.4 billion.  However, the House bill would provide the SEC with $149.3 million less than in FY 2023 for salaries and expenses which is $436.2 million less than the President’s FY 2024 request.

               The Senate bill would also increase funding by $20 million for the Federal Communications Commission (FCC), for a total of $410 million, while the House bill would cut $8.2 million from FY 2023 levels, which would harm the FCC’s ability to combat robocalls and scams against the elderly. 

               And for the Consumer Financial Protection Bureau (CFPB), the House bill takes away the non-appropriated financing of the agency, instead of requiring taxpayer dollars to fund CFPB for the first time and providing the agency with $2 million less than its funding in FY 2023.  The Senate bill does not contain this harmful language.

               Please be assured as Congress continues consideration of FY 2024 funding legislation, NTEU will continue to fight for a fair pay raise and adequate funding to properly staff federal agencies and the resources you need to do your job while opposing these harmful policy riders.  I will update you on further developments.

                                                                                    Anthony M. Reardon

                                                                                    National President