Senate appropriators on Tuesday backed a draft FY14 State-Foreign Operations bill, which provides $50.6 billion in discretionary funds, including $6.5 billion for overseas contingency operations. This amount is much higher than the amount of foreign aid supported in the House. At the same time, Senate appropriators are rejecting a GOP push to slash funding to the IRS in response to its alleged targeting of conservative groups.
The Senate Financial Services and General Government Appropriations Subcommittee advanced on Tuesday, a draft $44.3 billion measure to fund the Treasury Department, the Judiciary, District of Columbia, Securities and Exchange Commission and related agencies through FY14. It would provide $23.2 billion in discretionary spending and $21.1 billion in mandatory spending. The full Senate Appropriations Committee voted 16-14 to approve the bill on Thursday.
The Senate considered several amendments to the FY14 Transportation-HUD spending bill Thursday and is expected to continue work on it next week. Senators agreed on Thursday to kill a motion by Sen. Toomey (R-PA) that would recommit the $54 billion Transportation-HUD measure to the Appropriations Committee with instructions to report back a bill that would provide a maximum amount of $45.5 billion. The vote fell mostly along party lines, with only three Republicans breaking from party lines to support killing the motion. All three are appropriators. The motion to table or kill Sen. Toomey’s motion came from Sen. Murray (D-WA).
On the House side, the House Appropriations Interior-Environment Subcommittee approved 7-4 on Tuesday a draft bill that would provide $24.3 billion in funding for the EPA, National Park Service, Bureau of Land Management, Indian Health Services and other programs, $5.5 billion less than FY13 enacted levels and $4 billion less than post-sequestration spending. President Barack Obama requested less than $30 billion. The bill also would cap EPA staffing at 1992 levels and prohibit any rules that would limit greenhouse gas emissions by power plants or limit the sulfur content of gas.
The House on Thursday approved their FY14 Defense Appropriations bill (H.R. 2397) by 315 -109. The legislation provides $512.5 billion in non-war funding; a decrease of $5.1 billion below the FY13 enacted level and $3.4 billion below the President’s request. This is approximately $28.1 billion above the current level caused by automatic sequestration spending cuts. The bill also includes $85.8 billion in war funding for Overseas Contingency Operations (OCO).
The House Labor HHS Subcommittee was scheduled to consider their FY14 spending bill on Thursday July 25th, however on Wednesday morning the subcommittee announced that they were postponing the markup until a later date.
A Congressional Budget Office report on Thursday noted that canceling the automatic sequestration cuts for the rest of this year and next year would add almost one million jobs to the economy. The report was requested by Rep. Van Hollen (D-MD), the ranking member of the House Budget Committee. However, the report also noted that the increase in spending eventually would raise debt beyond current projections.
Senate Finance Chairman Max Baucus (D-MT) is preparing to introduce a bipartisan tax overhaul this fall. In preparation for its release, Democratic leaders have spoken out this week, calling for the tax package to include methods to raise significant revenue. Republicans have been very vocal in their opposition to raising taxes, and are hoping for a rewrite of the tax code that is revenue-neutral, potentially complicating the efforts of Baucus and House Ways and Means Chairman Dave Camp (R-MI), who are working together toward an overhaul.
Baucus has been very cautious in drafting the legislation, and tried to defer hard decisions about revenue levels as he seeks common ground with Republicans over structural tax changes. He has said the revenues sought by some Democrats were unrealistic.
On Tuesday, Baucus promised that he and his committee would consider tax overhaul legislation by November. His strategy of writing a bill without an overall fiscal agreement on tax and spending levels has also caused confusion, even if many senators also appreciate his eagerness to kick-start discussions.
Next week in Congress, the Senate will resume consideration of the Transportation-HUD appropriations bill (S.1243). Also on the schedule is the consideration the nomination of James Comey Jr. to be director of the FBI, as well as votes on nominees for on National Labor Relations Board: the administration’s choices are Kent Yoshiho Hirozawa, Nancy Jean Schiffer, and Mark Gaston Pearce (the current NLRB chairman); his term expires August 27. The Republican nominations of Harry Johnson III and Philip Miscimarra to be NLRB members are still pending.
On the House side, House Energy and Commerce will prepare to mark up a bipartisan bill that would replace the sustainable growth rate, Medicare’s formula for reimbursing doctor services (H.R. 2810). The bill is supported by physician groups, who are pushing for a variety of alternative payment systems. The bill would promote moving away from the existing fee-for-service system that critics say rewards volume of services over value.
Another issue on the horizon are talks of how to go about replacing the sequester. The Obama Administration and eight Republican senators are discussing potential cuts to Social Security and Medicare that could be part of an agreement to replace the automatic spending cuts in the 2011 debt deal (P.L. 112-25).
The group met on Tuesday and Thursday with White House Chief of Staff Dennis McDonough and discussed entitlement cuts similar to proposals in Obama’s FY14 budget blueprint. These include a less generous Social Security cost-of-living adjustment known as the chained consumer price index and means tests for Medicare, including higher premiums for individuals making more than $85,000 and couples making more than $170,000.
These discussions could possibly factor into broader negotiations this fall on raising the government’s borrowing authority and, possibly, overhauling the tax code.