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Questions About Program Funding
Export Development Programs in the President's Budget and Congressional Appropriations
Some parties interested in export development noted that, all such programs were called out to receive no funding in the President’s proposed 2019 budget. These programs included the Small Business Administration's State Trade and Export Promotion Grant Initiative (STEP), U.S. Department of Agriculture's Foreign Market Development and Market Access Programs, the U.S. Trade and Development Agency, and MDCP. In its 2019 budget, Congress actually funded all export-development program that are referenced in appropriations. MDCP was not mentioned in any 2019 appropriation.
This led some to believe that Congress specified that ITA (Commerce's International Trade Administration) fund new 2019 MDCP awards. It did not. Unlike every other federal export development program, because there is no reference to MDCP in an appropriation, Congress did not specify that ITA should make new MDCP awards in 2019.
In this situation, there is nothing to indicate that Congress wanted to eliminate MDCP. The program remains relevant. It has been a very effective at eliminating trade barriers and generating exports. In fact, the program has broad support among industry groups and others. Congress has never voted to end the program, not in 2018, nor at any time in MDCP’s 26-year history.
MDCP Funding Has Come from ITA's Budget Base
ITA has statutory authority to conduct MDCP competitions. Within ITA, it is the Industry & Analysis (I&A) business unit that administers MDCP. In MDCP's first year of operation, 1993, Congress included in its appropriation instructions that ITA should conduct an MDCP competition. Since that first year, Commerce appropriations included no mention of MDCP. But the lack of a specific MDCP call-out in the appropriation did not stop ITA from funding new MDCP award competitions.
With the understanding that funds sufficient to hold a yearly competition continued to be part of its budget base, ITA funded new MDCP projects from 1994 through 2005 and from 2007 to 2016. (See the chart of MDCP funding levels 1993-2017.) Even in 2006, 2017, 2018, and 2019, when ITA did not hold MDCP competitions, it was due to lack of funding in its budget base. Congress has never instructed ITA not to fund an MDCP competition.
Because the President's FY 2018 budget proposed eliminating funding for new MDCP awards, and because of cuts in the FY 2018 budget, ITA determined that, barring congressional instruction, it should not make new awards. Given a similar call in the President's FY 2019 proposed budget not to fund MDCP, and limited funds in ITA's base budget, ITA also decided not to hold an MDCP competition in fiscal 2019.
MDCP Competition Planned for 2020
The President's FY 2020 budget did not call out MDCP at all, neither do the House or Senate budget subcommittees proposals. ITA decided to prepare for a 2020 MDCP competition with funding from its budget base, a decision which does not depend on a call-out in an appropriation.
Prospects for a 2021 MDCP Competition
The President's FY 2021 budget does not call out MDCP. The House Committee on Appropriations, Commerce, Justice, Science, and Related Agencies will propose funding levels for ITA to include in the 2021 appropriation. The Senate Committee on Appropriations, Commerce, Justice, Science, and Related Agencies will propose funding levels as well. If they were to call out MDCP in ITA's appropriation, it would be in the ITA section under Industry & Analysis (I&A).
If MDCP is not called out in ITA's 2021 appropriation, ITA will have to decide if it can fund a 2021 competition from its budget base.
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