Mulvaney wrote that “if the debt ceiling is not raised, it may not be possible to outlay the requested supplemental appropriations or funds for other critical Government operations.”
If the debt ceiling isn’t raised soon, the U.S. government will only have enough cash to continue funding its operations through September 29, Treasury Secretary Steven Mnuchin has told lawmakers. Appropriating emergency money to help with the Harvey response will accelerate that deadline by several days, Mnuchin has said.
The U.S. government spends more money than it brings in through revenue, and it borrows money to cover the difference by issuing debt. But it can only issue debt up to a limit set by Congress, and the treasury is bumping up against that debt limit now.
The Trump administration had more than $350 billion in cash reserves in January but has been slowly drawing that balance down in recent months to delay any problems with the debt ceiling. It had less than $70 billion left in cash earlier this week.
Of the money requested by the White House, $7.4 billion is sought to replenish FEMA’s Disaster Relief Fund, which includes “funds to ensure FEMA is prepared for any additional disasters while continuing ongoing response and recovery efforts,” Mulvaney told Congress.
The request is $2 billion more than White House and congressional leaders were expecting to seek as of Thursday. Government officials were continually reevaluating the damage and how much money was needed for the short-term response.
Senate Majority Leader Mitch McConnell (R-Ky.) said late Friday that his chamber of Congress planned to act expeditiously on the request.
“Working closely with the president and the House of Representatives, the Senate stands ready to act quickly to provide this much-needed assistance to those impacted communities and support first responders and volunteers,” McConnell said.
The House of Representatives is expected to begin voting on appropriating the funds as soon as next week. Democrats and Republicans have said money is needed urgently to help people affected by the storm.
Jennifer Hing, a spokeswoman for House Appropriations Committee Chairman Rodney Frelinghuysen (R-N.J.) said the panel “will now move … rapidly to act as soon as possible to provide these critical funds” but did not discuss the precise timing for the handling of the request.
“We appreciate the speed of this request for funding,” Hing said. “It is essential that all the individuals, families and communities affected by this terrible disaster receive the necessary federal resources to begin to recover and rebuild.”
A House floor schedule for next week circulated by Majority Leader Kevin McCarthy (R-Calif.) indicated that there will be a vote on disaster aid, but it did not specify when.
More than 43,000 people are living in shelters, and more than 100,000 homes were damaged by the storm in southeastern Texas and Louisiana, Mulvaney wrote in his letter to Congress. He added that more than 22,000 federal employees are involved in the government’s response.
The White House is expected to seek much more money from Congress to respond to the damage caused by Harvey, but the $7.85 billion is an initial batch of funding that is needed for the immediate response, White House officials said.