Weekly Legislative Report Mar 24, 2017

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

Appropriations/Budget

The FY18 budget process already promises to run behind schedule, which may lead to another stopgap spending measure extending current funding levels to avoid a government shutdown.

President Trump proposed an outline of discretionary spending last week, with the full budget not coming until May.

The House Budget Committee is reportedly unlikely to adopt a FY18 budget resolution before the Easter recess, meaning the House is unlikely to produce a budget by the April 15 deadline set in statute.  Not making that deadline might prevent the House from taking up any spending bills until May.

Education

The Subcommittee on Higher Education and Workforce Development, chaired by Rep. Brett Guthrie (R-KY), held a hearing Tuesday to discuss reauthorization of the Higher Education Act (HEA) with a focus on student aid.

Witnesses highlighted the importance of simplifying and improving federal student aid to better accommodate adult students, increase completion time and reduce student debt.  Recommendations for streamlining student aid included: required loan counseling, restructuring of loan disbursement methods, and elimination of subsided loans.  A new bill introduced in committee this week, the Empowering Students Through Enhanced Financial Counseling Act (H.R. 1635), aims to improve the timing, frequency, and content of financial aid counseling.

Energy/Environment

Keystone Pipeline

Calgary-based TransCanada Corporation announced on Friday that it received a Presidential permit from the State Department, providing a green light to move forward with construction on the controversial Keystone XL Pipeline.

TransCanada subsequently dropped a $15 billion lawsuit it had brought against the U.S. under the North American Free Trade Agreement, filed after the Obama administration’s November 2015 rejection of its previous application.

The Obama administration’s rejection of the pipeline came after a campaign by TransCanada and its allies in Congress to build the $8 billion conduit from Alberta’s oil sands to Nebraska, connecting from there to existing pipelines to Gulf Coast refineries.  The project was met with years of protests from environmental groups, which sustained pressure on the Obama administration and Democrats in Congress.

Trump said that Keystone is the first of many energy projects his administration will be green-lighting.  His administration has already cleared the way for another controversial project, the Dakota Access Pipeline to move forward after the Obama administration had halted its construction to explore alternative routes and address concerns of the Standing Rock Sioux tribe.

Nuclear Energy

The Senate Environment and Public Works Committee voted, 18-3, on Wednesday to advance the Nuclear Energy Innovation and Modernization Act (S. 512), winning bipartisan support despite the panel’s differences on energy and environment issues.

Senate EPW Chairman John Barrasso (R-WY) introduced the bill, which aims to ease licensing and funding for new reactor development and would give U.S. firms working on advanced reactor designs a clear and relatively low-cost path to licensing by the Nuclear Regulatory Commission (NRC).

The bill would direct the NRC to modernize the regulatory pathway for license applicants and create a cost-sharing grant program to help pay fees for pre-application and application review.  The legislation also calls for an excess uranium inventory management plan and would limit how much uranium the U.S. Department of Energy can transfer or sell annually as well as boost the development of small modular reactors, or SMRs.

The expansion of nuclear power, which generates about 20 percent of U.S. electricity, has been slowed by high startup costs, a protracted licensing process and competition from cheap natural gas and renewables.  Supporters of the bill argue that a clear regulatory process would encourage investment in the technology and create skilled jobs.

Timing for full Senate consideration of the bill remains uncertain since Senators have been preoccupied with cabinet nominations.

Healthcare

House leaders canceled a vote Thursday on the American Health Care Act (H.R. 1628), the Republican bill to replace the Affordable Care Act aka Obamacare.  The decision represents a major setback to President Donald Trump and House Speaker Paul Ryan’s (R-WI) first substantial legislative effort under a GOP-controlled Congress.

The vote was delayed due to the current divide between House GOP members and calls into question whether Republicans will be able to fulfill their seven-year promise to repeal the ACA (PL 111-148, PL 111-152).

The bill was updated from its original version to try and meet an ambitious set of policy demands from the conservative House Freedom Caucus.  Trump, Ryan, and other House leaders spent Thursday unsuccessfully scrambling to negotiate a deal to persuade moderate lawmakers to accept AHCA. 

The new Congressional Budget Office estimates show how several key policy tweaks affected the impact of the package and overall, the package would reduce federal deficits by $150 billion by 2026, roughly $186 billion less than the original language.

The House is now scheduled to vote on the bill later today, and Speaker Ryan is reportedly going to the White House to update the president on the prospects for the bill.  Currently, the likelihood of the bill passing seems doubtful.

Washington Outlook

Next week in Congress, if and when GOP health care legislation passes the House, it could face potential parliamentary trouble in the Senate.

Senate Democrats are already scouring the legislation for possible violations of a procedural rule that could only be overridden with 60 votes — a threshold Republicans lack.  Any provision of the health care plan that doesn’t directly relate to spending or revenue could violate the Byrd rule, which forbids extraneous provisions from any bill that is being considered on a fast track.

Whether any of the legislation in fact violates the Byrd rule won’t be clear until the measure comes before the Senate for debate.  Senate Minority Leader Charles Schumer (D-NY) said provisions that give states the option to impose a work requirement on Medicaid recipients and bar the use of tax credits for insurance policies that cover abortion may violate the Byrd rule.  And a provision that was under discussion Thursday by House leaders to lift mandates that insurance policies cover certain services would also appear to be open to a Byrd rule challenge if it becomes part of the legislation.

In addition, Senate Republican aides said the Senate would be unlikely to take up any reconciliation bill passed by the House to repeal the health care law until May because of the need to wait for Congressional Budget Office estimates, plans to bring the nomination of Supreme Court pick Neil Gorsuch to the floor before the Easter break and the need to extend a FY17 continuing resolution that expires April 28.