Both the House and Senate this week passed a Continuing Resolution running through December 11th. On Wednesday evening the House passed the CR by a vote of 319-108. The Senate passed the CR on Thursday by a vote of 78-22. Both chambers also adopted amendments that authorize the administration to train and equip Syrian rebels in the fight against the Islamic State terrorist group.
The FY15 continuing resolution would fund the government at its current rate of $1.012 trillion annually, but would impose an across the board cut of 0.0554 percent to get to that level.
Included in the resolution is the administration’s $88 million request to fight the Ebola crisis, providing money to both speed the development and manufacturing of Ebola drugs and to support medical specialists on the ground in West Africa.
The measure also extends the Export-Import Bank’s authorization through June 30, 2015, and includes an extension of the Internet Tax Freedom Act, but does not include any extra funding for the child migrant crisis, though it does include some added flexibility for border agencies to shift dollars.
This week Majority Leader Harry Reid (D-NV) and Majority Whip Richard Durbin (D-IL) said that Democrats hope to bring up a proposal that would allow states more leeway to enforce online sales taxes after the elections.
Senator Mike Enzi (R-WY) sponsored the Marketplace Fairness Act or MFA (S. 743) that passed the Senate last year, but has gone nowhere in the House. In order to make the bill more appealing to more conservative House members, Enzi has since come up with a newer online sales tax proposal entitled, the Marketplace and Internet Tax Fairness Act (S. 2609). This bill combines online sales tax enforcement authority with a 10-year extension of the Internet access tax moratorium, which will be extended for six weeks starting November 1 through December 11 under the new continuing resolution (H. J. Res 124). Still, the latest proposal is opposed by adversaries of online sales taxes and advocates of a permanent extension of the Internet access tax moratorium.
Originally, House Republicans pushed back against MFA voicing concern that it could be perceived as a tax measure, however the bill is not a new tax, but rather enforces an existing tax. In addition, lawmakers from states without sales taxes oppose the bill.
Still, compliance concerns remain a sticking point in the House, where some conservatives have portrayed it as an effective tax hike on consumers who now bypass state directives to remit sales taxes on their own. The federal mandate drive backed by states and Main Street retailers has been complicated by invalidating efforts to block new state and local taxes on Internet access and other types of communications services like mobile devices (S. 1235, H.R. 2309).
House Judiciary Chairman Robert Goodlatte (R-VA) called for a framework of online sales tax principles to protect states’ rights and simplify compliance in order to “render a small business exemption unnecessary,” but offered no timetable for moving a House alternative to the Enzi bill.
In a post-election session, lawmakers will have the choice of cutting a deal on a measure like the new Enzi bill, possibly as an add-on to an extension of tax breaks, or delaying action until next session.
Several members from both chambers this week released transportation-related bills before heading back to their districts for the mid-term elections. The bills’ are more symbolic than anything, and will be used more for discussions with constituents and as placeholders for possible action in the next Congress.
Of significance are two bills, one regarding the employment rules for the Federal Aviation Administration (FAA) and another dealing with federal grants for local governments.
The first is a House measure authored by Reps. Randy Hultgren (R-IL) and Daniel Lipinski (D-IL) and would overturn the FAA’s new hiring rules for air traffic controllers. Put in place this year to comply with federal employment rules, the rules no longer give preference to applicants who have graduated from college-level training courses or who have relevant military experience. The lawmakers also say it takes too long for the agency to score the tests, leaving some candidates to “age out” after they turn 31. Their bill would allow them to reapply.
The second bill (S. 2891) was offered by Senators Cory Booker (D-NJ) and Roger Wicker (R-MS) and would give local governments the ability to compete for more federal highway funds. Right now, much of the money disbursed under the highway bill flows through the states before reaching local governments. The senators want to give local officials a way to leapfrog over their state governments and apply directly for the federal grants.
The Obama administration has endorsed giving local governments more autonomy in making transportation policy so we can expect to hear more about directly funding local projects when Congress takes up another highway bill in the spring.
The House and Senate adjourned on September 18 and do not plan to return until November 12, after the midterm congressional elections. During the Lame Duck session, Congress hopes to address numerous measures, some of which may include: online sales tax legislation, tax extenders, the National Defense Authorization Act, and a new funding mechanism to keep the government open past December 11.
The next Weekly Legislative Update will cover the short week of November 12-14 when Congress returns to Washington. As always, we will keep you apprised of relevant events