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Category: On the Hill

Sequester “Line in the Sand” Bills

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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 31strather 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.

Read more key excerpts from Murray’s speech.

House L-HHS-Ed Mark Up

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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

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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 1st, 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.

The Aftermath…

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Both the House and Senate are in recess this week for the Fourth of July holiday.  Late last week, both chambers demonstrated that they can advance legislation by reauthorizing federal highway and transit programs for two years and preventing Stafford student loan interest rate increases.  Also last week, the Supreme Court upheld the Affordable Care Act (ACA). Republicans vow to continue to cut or restrict funds to implement the Act, and Democrats encouraged states to move forward on implantation. While some features of the ACA have already been adopted – no denying coverage for pre-existing conditions and adult children can remain on their parents’ plans until the age of 26 – the main feature that mandates that all Americans must purchase some form of health coverage takes effect in 2014.

But the BIG news from last week is the major storm that hit the DC area late Friday night. Winds reached 80 MPH with intense thunder and lightning, leaving massive power outages and other storm damage throughout the region – mostly downed trees and power lines. Hundreds of traffic lights are still out and a half-million homes are still without power with outages expected to continue in some areas through the end of the week. This might not be so bad if the temperature wasn’t expected to be in the 90s all week!  Federal workers have the option to take unscheduled leave due to this mess, but if I were without power I would make my way into my air conditioned office post haste!

You’ll be happy to know that the dedicated Office of Federal Relations Team made it through the storm unscathed – all our homes had power over the weekend – and we all made our way into the office this morning. Happy Monday!

Student Loans and Transportation Research

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The House and Senate both will take action today on the conference agreement to HR 4348, the Moving Ahead for Progress in the 21st Century Act (MAP-21). The agreement reauthorizes federal highway, transit, and other surface transportation programs through September 30, 2014, at current funding levels with inflationary increases for certain programs. It consolidates or eliminates dozens of programs, and streamlines environmental reviews of proposed projects to more quickly begin construction. The measure also extends for an additional year the 3.4 percent interest rate for new federally subsidized student loans (Stafford Loans), and it overhauls the federal flood insurance program to help make it actuarially sound. To cover Highway Trust Fund shortfalls, the measure transfers $21.2 billion in general fund and other monies, and offsets the costs of those transfers through changes to pension law and other provisions. The measure does not include controversial House GOP-supported provisions that would have approved the Keystone XL pipeline, or shifted regulation of coal ash from EPA to the states.

MAP-21 includes language reauthorizing the University Transportation Centers (UTCs), which conduct transportation and transit related research as well as developing the future workforce in these fields.  UW operates the UTC for USDOT Region X.  We successfully retained language in the final bills to reauthorize Regional UTCs, which were under threat of elimination in earlier iterations of the bill. Specifically, HR 4348:

  • Authorizes 5 National Centers at $3 million each; 10 Regional Centers at $2.75 million each; and 20 Tier 1 Centers at $1.5 million each.
  • Requires Tier 1 Centers to have a 50 percent match and all other Centers a 100 percent match.
  • Requires one of the regional centers to focus on “comprehensive safety” as their main research issue.
  • Requires USDOT to establish a competitive recompletion for all Centers at the same time and no later than 1 year from enactment. 

The Office of Federal Relations is discouraged to see that everyone will need to re-complete within a year as they just went through this process last fall.  And, the overall authorization is only for two years, so all of this will come up again before we know it, and may require Centers to re-compete again.