Sequester “Line in the Sand” Bills

Posted on July 17, 2012October 17, 2012

Senate Democrats are warning that they will not agree to a deal to stop across-the-board spending cuts early next year (sequester) without new revenue gained by ending tax breaks on the wealthiest Americans. To that end, they circulated a draft bill yesterday that would spare most Americans from higher tax rates that are due to take effect on January 1, 2013, but the bill would allow the Bush tax cuts to expire on annual household income greater than $250,000 and raise the rate on dividends and capital gains from the current 15 percent to 20 percent. The Senate will vote before the August recess on the Democrats’ tax bill, which also would preserve current tax rates on household income under $250,000 and individual income under $200,000. The House Republicans plan their own vote this month to extend all of the Bush-era tax cuts. But the votes in both chambers will be symbolic, as neither party will be able to get the 60 votes needed to advance its plan in the Senate.

Both measures are seen as “lines in the sand” for the big negotiation that will take place after the November elections during the “lame duck” session that will include new rounds of negotiations on the many large fiscal issues facing the country, including the broad array of expiring tax cuts and automatic across-the-board spending reductions known as the sequester.

Indeed, US Senator Patty Murray (D-WA) said Monday her party would allow ALL current tax rates to expire on December 31^strather than accept a deal with Republicans for averting the sequester that doesn’t include additional revenue from more affluent Americans. “If we can’t get a good deal, a balanced deal that calls on the wealthy to pay their fair share, then I will absolutely continue this debate into 2013, rather than lock in a long-term deal this year that throws middle-class families under the bus,” Murray said in a speech yesterday.

House L-HHS-Ed Mark Up

Posted on July 12, 2012October 17, 2012

The House is likely to mark up their Labor-HHS-Education appropriations bill on July 18, although no official announcement has been made. The $150 billion bill is the only one of the 12 annual spending bills not yet approved by House appropriators. At $150 billion, the measure would be about $7 billion below current spending.

This Week in Congress

Posted on July 9, 2012October 17, 2012

Both the House and Senate return to Capitol Hill today from their Fourth of July recess and begin the final four week stretch before the August recess. The Senate is in at 2:00pm though no votes are scheduled until tomorrow. The House is also in at 2:00pm with votes expected at 6:30pm, when seven bills will be considered including a veterans jobs bill and a bill to enact cost of living adjustments for vets.

The House has no floor or committee action is scheduled for the FY 2013 appropriations bills, but they will work on other legislation this week — a farm policy bill, a repeal of the health care overhaul, and a business tax break — that could significantly alter future spending. Although both chambers will work on appropriations bills this month, Congress appears unlikely to clear many, or perhaps any, FY 2013 spending bills before election day. It will likely be December at the earliest before the appropriations process is completed. Before the new federal fiscal year starts October 1^st, Congress will need to pass a stopgap funding measure or continuing resolution (CR). Leaders in both chambers are already eyeing attaching a CR to one of the least controversial appropriations bills, the Military Construction-VA measure.

To date, the House has passed six of their 12 spending bills. The House Appropriations Committee has approved 11 spending measures and may move the remaining measure, Labor-HHS-Education, this month. The full Senate has not yet taken up any of their appropriations bills. The Senate Appropriations Committee has approved nine bills, and may mark up the remaining three — Defense, Interior, and Legislative Branch —before the August recess.

Congress Requests Information on Implementation of the Sequester

Posted on June 26, 2012October 17, 2012

Today, the House Budget Committee mark up Republican leaders’ legislation, similar to bipartisan language added last week to the Senate farm bill that seeks more information about the automatic budget cuts. The action comes after several attempts by lawmakers to get more details from the administration about how the roughly $109 billion sequester will take effect in January. The House bill (HR 5872) and its Senate companion measure (S 3228), introduced by Republican leaders in both chambers in May, would require the president to submit a detailed report on sequestration, identifying each account that would be affected and the amount by which it would be reduced. As introduced, the report would be due on July 9th, which is several weeks earlier than deadlines set by the Senate in the farm bill. Moreover, the Senate proposal is far more detailed, requiring a report from the president that would include a list of accounts that would be affected, an analysis of the impact of the cuts to key areas of government as well as the private sector within 60 days, and a Pentagon review by August 15th on the impacts of the cuts to national defense.

As you will recall, the across-the-board cuts, or sequester, was a consequence of the failed Joint Deficit Reduction Committee that was laid out in the Budget Control Act last August. To date, there has been very little information released by the administration on how the sequester will be implemented.

Very Big Week in Congress

Posted on June 25, 2012October 17, 2012

Today begins a very big week in Congress that could have huge consequences for the remainder of the calendar year. First, the Supreme Court is expected to hand down its decision on the Affordable Care Act (ACA), a ruling that will likely dominate the airwaves this week. Second, Congress must deal with two critical legislative issues this week before the June 30^th deadlines: student loan interest rates and highway funding. If Congress does not take action by June 30^th, interest rates on federal student loans will increase from 3.4 percent to 6.8 percent. Congress also faces a deadline to reauthorize highway and transit funding, or they must enact another extension for those programs to continue (this would be the 10^th extension so far). Finally, the House is expected to vote to hold US Attorney General Eric Holder in contempt of Congress this week for failing to disclose internal Justice Department documents on how federal officials allowed guns to fall into the hands of Mexican drug cartels (the “Fast and Furious” scandal for those of you following this closely).

Both the House and Senate are in session this week and will go into recess next week for the Fourth of July holiday.

Appropriations: The House Appropriations Committee approved three more FY 2013 spending bills last week—Agriculture, Financial Services, and Transportation-HUD—and held a subcommittee markup of its FY 2013 Interior-Environment spending bill, which funds the Environmental Protection Agency (EPA) and the US Geological Survey (USGS). The House Appropriations Committee held a subcommittee markup of the FY 2013 Interior-Environment Appropriations, which would provide $7 billion for the EPA, $1.4 billion (17%) below the FY 2012 enacted level and similar to the agency’s funding level in FY 1998. The bill also provides $967 million for the USGS, $101 million below the FY 2012 enacted level.

The full House has approved six of their FY 2013 spending bills. The full Senate, on the other hand, has yet to take up a FY 2013 spending bill and the appropriations committee has slowed its work after moving nine of its 12 bills through the process. The Senate is not expected to take up any before next week’s Fourth of July recess.

The Supreme Court’s ruling on the ACA this week will certainly have an impact on Congress’ ongoing appropriations and budget debates. House appropriators have just one remaining measure to be unveiled — the Labor-HHS-Education bill. House leaders will almost certainly continue their attempts to “defund” the ACA when and if this measure comes up. Senate Democratic appropriators recently moved forward with their version of the FY 2013 Labor-HHS-Education bill that kept the funds intact.