Third federal shutdown averted

January 27, 1996
Web posted at: 9:50 a.m. EST

WASHINGTON (CNN) -- Narrowly averting the prospect of a third federal shutdown, President Clinton has signed a bill to fund the government for another seven weeks.

"I am pleased that the Congress avoided another partial shutdown, and I appreciate its bipartisan approach to this bill," Clinton said in a statement released Friday night shortly before a previous spending bill was to expire.

The Senate passed the bill earlier Friday by a vote of 82-8. On Thursday, the House passed the bill, which funds nine departments including Commerce, Justice and Health and Human Services through March 15 -- though most at lower funding levels than last year.

Two amendments proposed by Senate Democrats, one to extend the nation's debt ceiling and another to restore full funding to federal education programs, failed.

Republicans reluctantly agreed to fund U.S. aid to international family planning programs, but at 35 percent less than current levels. The White House, for its part, agreed to a ban on federally funded scientific research using human embryos.

Passage of the bill reflected a new conciliatory spirit on the budget by Congress and the White House.

In passing the bill, the Republican-controlled Congress, which was widely blamed for two previous shutdowns, backed away from a strategy to leverage its budget priorities with the threat of federal furloughs.

"We did the wrong strategy. That's okay. We tried. It didn't work. Now we've got to be smarter," said House Budget Committee Chairman John Kasich, R-Ohio.

The temporary spending measure funds those parts of government that do not already have appropriations through March 15.

Republicans called the bill a "down payment" on the deficit. Toward that end, the bill contains cuts in several areas including:

a 25 percent cut in funding for federal education programs
a 14 percent cut in funding for the Environmental Protection Agency.
$1.2 billion in cuts for federal housing programs
a 25 percent cut in President Clinton's Americorps community service program.
a 25 percent freeze in federal grants for several programs including AIDS prevention programs, drug prevention and bilingual education programs.

Several social programs were spared the ax in the latest round of budget cuts including:

Medicare (payments to Medicare trust funds and claims contractors)
Medicaid (payments to states)
Aid to Families with Dependent Children
elderly nutrition services
child support enforcement
Head Start

The bill did not address the nation's debt ceiling. Treasury Secretary Robert Rubin has warned Congress that the U.S. will risk an unprecedented default on its debt if no measure is taken by March 1. Senate Democrats tried Friday without success to increase the current debt limit from $4.9 trillion to $5.4 trillion.

If the Congress does not address the debt limit issue by the end of next week when it adjourns, it will have only four days to take up the matter after it reconvenes on Feb. 26.

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The Associated Press and Reuters contributed to this report.