Monthly Archives: May 2017

Weekly Legislative Report May 12, 2017

source: Capital Decisions Newsletter
J.R. Reskovac
Sarah Strup Herbert

Appropriations/Budget

Congress may have the freedom to make progress on the FY18 budget without endangering the FY17 reconciliation instructions for a Republican health care bill.  The Senate in 2006 adopted its version of a fiscal 2007 budget resolution and later in the year passed a reconciliation tax cut bill based on reconciliation instructions from a fiscal 2006 budget resolution.

The precedent means that the House and Senate Budget committees could mark up a FY18 budget resolution and adopt initial versions of the measure as well as begin the early stages of the FY18 appropriations process without waiting for congressional action on the health care overhaul.

The April 15 statutory deadline for both chambers to adopt a budget resolution, which sets enforceable levels for spending and taxes, passed almost a month ago.  The House and Senate Budget committees have yet to make public or mark up a budget resolution.

Senate Budget Chairman Michael Enzi (R-WY) referenced the precedent this week and says he wants to take up the FY18 budget resolution “as soon as we can.”

The House passed a reconciliation bill (H.R. 1628) based on FY17 reconciliation instructions to partly repeal and replace the Affordable Care Act (PL 111-148, PL 111-152), and the Senate is working on its own version.  But it could take weeks or months for the Senate to write and consider its bill or amendment, and for the House and Senate to attempt to pass a bill that’s been approved by a conference committee.

Still, appropriators in both chambers have begun to hold hearings in preparation for marking up the 12 FY18 spending bills, but are waiting for sub-allocations for each bill from the Appropriations chairmen before they can officially mark-up the bills.  The Appropriations chairs usually divide funds into the sub-allocations after receiving a discretionary spending topline from a budget resolution adopted by Congress.

Without a budget resolution, the House or Senate can bring appropriations bills to the floor after a chamber has passed a resolution to deem enforceable spending limits, which has not happened this year.  The 1974 budget law (PL  93-344) also allows the House to bring appropriations bills to the floor after May 15 even without a budget resolution or deeming resolution.  However, appropriators can’t write bills until they have their sub-allocations.

Education

A few weeks ago, several universities were informed their applications for Upward Bound grants would be denied due to formatting errors.  Late last week, it was reported that in response to backlash, Education Secretary DeVos instructed department officials that she was rescinding the ability for program offices to impose mandatory page length or formatting rules in grant applications.  Furthermore, she stated that non-conforming formats could not be the basis to reject grant applications.  Her memo also states the policy takes effect immediately for FY18 and any FY17 notices that have not been published.  The memo does not provide for the reconsideration of recently reject grant applications.

The Education Department also formally removed Obama proposed regulations that were to become effective this year.  The teacher preparation regulations required Institutions of Higher Education (IHEs) to report on teacher placement and their evaluation ratings once employed.  The goals were to provide better transparency on effective training programs for prospective students to have a measurement to compare teacher preparation programs. 

Energy/Environment

Climate Change

Thursday, Secretary of State Rex Tillerson signed the Fairbanks Declaration in Fairbanks, Alaska, acknowledging the threat posed by climate change to the Arctic and indicating the need for action to curb its impact on the region.  He met with Arctic Council, a forum made up of indigenous groups and eight countries with territory bordering the Arctic Circle.

The declaration is at odds with the Trump administration officials who have expressed skepticism of climate change and comes at a time when President Trump is weighing a potential withdrawal from the Paris Agreement.  Despite overwhelming agreement among climate scientists to the contrary, Trump has called global warming a “hoax,” and vowed on the campaign trail to pull the U.S. out of the Paris agreement.

Methane

Senators on Wednesday voted on a Congressional Review Act resolution (H J Res 36) that would undo an Interior Department regulation limiting the release of methane from oil and gas operations on federal land.

Republicans believed they had enough votes to pass the bill, but a procedural motion to advance the resolution was defeated, 49-51. Three Republicans, including Sen. John McCain (R-AZ), voted “no.” This is the first of 15 CRA resolutions considered by Congress this year that failed.

The other two Republicans that voted no were Sens. Lindsey Graham (R-SC) and Susan Collins (R-ME) who had said publicly they would turn down the motion.  Republicans believed they had 50 votes and Vice President Mike Pence, who was on hand for the morning vote, would break the tie.

McCain said that while he opposed the extensive reach of the regulation, he feared that a clause in the Congressional Review Act that would prevent federal agencies from redoing the rule in a substantially similar form could prevent the Interior Department from making needed improvements to preventing methane waste.

Healthcare

FDA

Thursday, the Senate Health, Education, Labor and Pensions Committee advanced a bill (S. 934) to renew the Food and Drug Administration’s ability to collect fees from the drug and medical device industries by a vote of 21-2. 

The panel blocked an attempt from Sen. Bernie Sanders (I-VT) to include language on the importation of lower-cost prescription drugs from Canada, keeping the bill on a smooth path toward the Senate floor, where it is expected to be taken up next month.  The two dissents were from Sanders and Sen. Rand Paul (R-KY) who also supports the concept of drug importation and wants the FDA to accept more clinical trial data for drugs tested in foreign countries.

Most HELP committee members agreed that drug pricing was an issue that needed to be addressed and HELP Chairman Lamar Alexander (R-TN) suggested the issue could come up again when S. 934 reaches the Senate floor.

Repeal & Replace

Senate Republicans are avoiding the regular Senate committees for the development of an alternative to a House-passed measure seeking to repeal and replace the Affordable Care Act.  This week GOP senators formed working groups to explore alternative bill options.  Some Republican senators, taking the lead from House conservatives, are backing an idea of allowing states to adjust essential benefit (EHB) coverage requirements.  The House-passed measure included an amendment that keeps federal coverage requirements but let states seek a waiver to opt out of many of the requirements.

Any action by the Senate on a repeal and replace bill will wait until at least the week of May 22, when the Congressional Budget Office is expected to release its analysis of the bill that narrowly cleared the House last week.

Washington Outlook

Next week in Congress, the Senate Finance Committee will hold a hearing to discuss Medicare policies that improve care for patients with chronic conditions.   

The Senate will also continue to consider nominations in the Administration and plans to hold a cloture vote Monday at 5:30 p.m. on Jeffrey Rosen’s nomination to be deputy secretary of Transportation.

In the House, after returning from a week-long recess break, the House Appropriations Labor, Health and Human Services, Education, and Related Agencies Subcommittee will discuss biomedical research with officials from National Institutes of Health.  The House Ways and Means Committee will hold a hearing examining the status of Medicare payment systems.

Weekly Legislative Report May 5, 2017

source: Capital Decisions Newsletter
J.R. Reskovac
Sarah Strup Herbert

Appropriations/Budget

The fiscal 2017 omnibus bill (HR 244) was released early Monday and passed the House on Wednesday by a vote of 309-118.  Senators on Thursday voted 79-18 to clear the $1.07 trillion spending package, sending it to the White House for signature.  President Trump signed the bill into law this afternoon.

Below is a look at which agencies fared the best and worst under the spending agreement.

Winners:

  • National Institutes of Health (6.3% increase) – In Trump’s FY18 budget, he proposed an 18% cut to NIH.  Congress largely ignored the proposal and increased NIH’s FY17 funding by $2 billion, to $34 billion. The measure would boost spending specifically on Alzheimer’s disease, precision medicine and other research.
  • Department of Transportation (3.7% increase) – Overall, Transportation would receive $19.1 billion, a $681 million boost.  Within the DOT, the Federal Railroad Administration would receive a 10 percent spending increase and the Transportation Investment Generating Economic Recovery (TIGER) grant program, an Obama initiative Trump has proposed eliminating, would be fully funded.
  • Department of Homeland Security (3.5% increase) – Lawmakers declined to provide any funding for Trump’s proposed physical wall along the U.S.-Mexico border.  Instead, Congress increased spending by just $1.1 billion to boost hiring for immigration enforcement and border security.
  • Department of Defense (3.5% increase)- The Pentagon would receive $516 billion in discretionary spending and an additional $77 billion for overseas contingency operations. In addition to a $5.8 billion boost Defense already received through a supplemental to a previous CR, the department would receive a total increase of 4.5 percent compared to FY16. 
  • FBI (3.3% increase)- While the Justice Department would absorb a net cut overall, the FBI would receive a $277 million spending boost to go toward fighting cybercrime, counterterrorism and other programs and the bureau will receive more than $300 million to build a new headquarters.

Losers:

  • General Services Administration (13.3% decrease)- GSA would face the largest cuts of any major agency with funding decreasing by $1.35 billion. Lawmakers said the major reductions would take place in the agency’s new construction accounts.
  • Department of Agriculture (2.9% decrease)- USDA had a $623 million reduction in discretionary spending.  However, Rural Development and the Farm Services Agency would receive a funding increase under the omnibus bill despite being targeted in Trump’s budget for cuts.
  • Department of Education (1.7% decrease)- Education would absorb cuts to its Innovation and Improvement programs and effective instruction grants.  Democrats were able to block Republican efforts to prevent enforcement of Title IX laws with respect to transgender student access to bathrooms.
  • State Department (1.1% decrease)- There is $53.1 billion in funding for State operations, U.S. Agency for International Development and foreign assistance under the bill, including $16.5 billion in overseas contingency spending.  Most of the decrease would come from a $683 million cut to payments for the United Nations and other international organizations.
  • Environmental Protection Agency (1% decrease)- Despite Trump’s proposed 31% cut to EPA in FY18, EPA will receive a little over $8 billion.  This is the first step in what will likely be more steep cuts in FY18.  The agency is currently offering early retirement and buyout incentives and would be capped at 15,000 employees, its lowest level since 1989.  EPA’s research and regulatory programs would see a $52 million cut.

Education

The House Oversight and Government Reform Committee held a hearing this week on the online FAFSA system breach that impacted families applying for federal student aid.   IRS, Treasury and Education Department officials testified, each of them reflecting blame for the system failures.  Rep. Virginia Foxx, Chairwoman of the House Education Committee chastised the panel and remarked the incompetence of the FSA was on full display.  Mr. James Runcie, Office of Federal Student Aid, said the IRS tool used to apply for federal financial aid will remain unavailable for those seeking help for the 2017-18 school year.

The House Education and the Workforce Committee also held a hearing this week regarding legislation to reauthorize the Carl D. Perkins Career and Technical Education Act that has received bi-partisan support in past Congresses.  The bill simplifies the application process, increases application with today’s in-demand jobs and increases accountability to better evaluate program effectiveness.

Energy/Environment

Ethanol bill

Several Midwestern Republicans are considering holding up a bill to reverse an Obama administration drilling rule in exchange for a vote on a piece of ethanol legislation.

Senators Chuck Grassley (R-IA) and John Thune (R-ND), along with several other Midwestern Republican Senators, are pushing legislation to overturn federal policy preventing gasoline sales with 15 percent ethanol (E15) during the summer months.  The group says it will trade its votes on a resolution undoing a federal methane regulation for the ethanol vote.  The methane regulation is an Interior Department rule forcing energy companies to curb emissions of methane escaping from wells and pipelines on public land.  It aims to discourage the practice of venting and flaring natural gas at oil wells and blocks companies from venting gas except in emergencies, phases down the amount of flaring that is allowed, and forces the businesses to detect and repair gas leaks.

But they’ll need to act quickly; under the terms of the Congressional Review Act, which provides the Senate a window of 60 legislative days to overrule a regulation, the Senate has a May 11 deadline for passing the bill.

Supporters of the methane resolution have struggled to secure the votes they need to move it to the floor and will need to bolster support for the CRA resolution and sidestep the ethanol debate by next Thursday in order to assure the bill’s passage.

Environmental lawsuits

Two environmental groups are suing the Trump administration; the first over last week’s offshore drilling executive order, and the second over the Environmental Protection Agency’s policy putting a hold on Obama’s water pollution limits from coal-fired power plants.

The first lawsuit is led by environmental law firm Earthjustice, and says President Trump cannot roll back drilling prohibitions that former President Barack Obama instituted in the Arctic and Atlantic oceans because they are permanent.

The second lawsuit is from a coalition of environmental groups saying the EPA should have sought public input before rolling back standards that could allow millions of pounds of toxic pollution to be dumped into waterways.

Healthcare

Yesterday, the House passed an amended version of the American Health Care Act (AHCA) by a vote of 217 – 213.  House passage came after Rep Upton (R-MI), former chairman of the House Energy and Commerce Committee, and Rep Long (R-MO) offered an amendment to provide $8 billion to offset the costs of individuals with pre-existing conditions who cannot afford their insurance premiums.  An amendment negotiated by Rep. MacArthur (R-NJ) during the recent recess that would allow states to waive essential health benefits and community rating requirements if the state has established a high-risk pool, also passed prior to final passage of AHCA.  

All Democrats voted “no” and the twenty Republicans voted in opposition.

The bill now moves to the Senate, where the process may be lengthy and several Senators said yesterday that the Senate will craft its own legislation.  The Senate bill will be developed by a working group of members from the Senate Finance, Budget and Health, Education, Labor and Pensions (HELP) Committees.  Senate HELP Committee Chair Alexander (R-TN) confirmed that the Senate will develop its own package and reporters, “We’ll take whatever good ideas we find there [the House bill] that meet our goals.”

The package developed by the Senate workgroup will likely differ from the AHCA for both procedural and policy reasons.  As you know, many of the provisions in the bill as passed by the House likely cannot move in the Senate on the special reconciliation procedure, which only requires 51 votes for passage.  Additionally, many moderate Senators, especially those from Medicaid expansion states, have expressed concerns with the changes to the Medicaid program in the AHCA.  In a statement, Senator Portman (R-OH) said, “I’ve already made clear that I don’t support the House bill as currently constructed because I continue to have concerns that this bill does not do enough to protect Ohio’s Medicaid expansion population, especially those who are receiving treatment for heroin and prescription drug abuse.  We have an opioid crisis in this country, and I’m going to continue to work with my colleagues on solutions that ensure that those who are impacted by this epidemic can continue to receive treatment.”  

In a statement following the House vote Senate Finance Committee Chair Hatch (R-UT) acknowledged the procedural and policy challenges facing the Senate stating, “As we work to fulfill our promise to our constituents to repeal and replace the law in the Senate, we will be guided by the important principles to address costs and give American families more choices.  At the same time, we will be working to put together a package that reflects our member’s priorities with the explicit goal of getting 51 votes.  Coupled with the constraints imposed by the budget reconciliation process, we must manage expectations and remain focused on the art of the doable as we move forward.”

In terms of timing, Leader McConnell (R-KY) said the Senate will not consider a bill without a Congressional Budget Office (CBO) score, which will provide cost and coverage numbers. Once a score is released, the Senate parliamentarian will review it to see what provisions comply with the reconciliation rules.  CBO’s work and the parliamentarian’s review process could take several weeks, possibly pushing Senate debate until at least June. The score and parliamentarian’s analysis will likely guide the Senate workgroup’s work; Sen. Collins (R-ME) said, “We certainly need the CBO analysis on the impact on cost and coverage before we can produce our own [bill].” 

Reiterating that Senators do not feel pressured to act quickly, Senate Majority Whip Cornyn (R-TX) made clear that the Senate is not under a deadline and said, “When we have 51 Senators we will vote but not until then.”

It is unclear if the House would be able to pass a modified bill when/if it is returned to the chamber for consideration.

Washington Outlook

Next week in Congress, the Senate will ready consideration for nominations to join the president’s administration.  One of the few ready is former Rep. Heather Wilson (R-NM) who is Trump’s pick to be secretary of the Air Force. The Armed Services Committee voted 22-5 to advance her nomination a month ago.  She will get a confirmation vote Monday.  The Senate will next consider Scott Gottlieb, who is picked to be commissioner of the Food and Drug Administration.  Majority Leader Mitch McConnell filed a debate-limiting cloture motion on him Thursday afternoon.

The House will be in recess next week.