Washington Weekly – January 31, 2014

January 31, 2014

The House passed the farm bill conference report and a bill restricting the number of health insurance plans that cover abortion, while the Senate passed a bill that would delay National Flood Insurance Program premium increases for four years.

State of the Union Address

The President delivered his State of the Union address earlier this week stating that this is a “breakthrough year for America.” He proposed a number of Democratic priorities including restoring cuts in research spending, infrastructure investment, extension of unemployment insurance benefits, raising the minimum wage, expanding the Earned Income Tax Credit, automatic IRAs for employees without workplace savings plans, tax reform (closing loopholes and reducing incentives to ship jobs overseas), high tech manufacturing, patent reform, an “all of the above” energy strategy, cleaner energy economy, immigration reform, and training for future workers.

The President also stated that he would employ the use of Executive Orders to bypass Congress to implement his priorities, the first of which would raise the minimum wage to $10.10 for those working on new federal contracts for services. Executive Orders cannot be overturned by Congress, but Congress can pass laws to cut funding for the order’s implementation. In an off election year, for each political party, it’s all about turning out their base. Republicans will use this move as an overreach of power, while Democrats will say that it was the only way of implementing the President’s agenda with Republicans in control of the House of Representatives.

Rep. Cathy McMorris Rodgers (R-WA) delivered the Republican’s response and touched on issues important to Republicans contrasting them with those of Democrats. The Republican priorities included initiatives that champion free markets, “opportunity inequality” instead of “income inequality,” school voucher programs, repealing provisions of the Affordable Care Act, and immigration reform focusing first on securing borders.

Cybersecurity

What was noticeably absent in the President’s State of the Union speech was the issue of cybersecurity. The President emphasized the issue in his speech last year and issued an executive order that has the government and industry collaborating on new, voluntary standards. This year he only said, “we’ll keep strengthening our defenses, and combat new threats like cyber-attacks.” Under the executive order, companies will be able to choose on their own how to improve their cybersecurity practices, and will receive yet to be specified benefits in exchange for implementing these new practices. These benefits could include faster federal assistance for critical infrastructure or preference when the government needs to buy new technology. The question is whether or not the President has the authority to offer these benefits without action from Congress. The standards should be finalized next month. Federal agencies have also been exploring whether or not they need to update existing regulations to take into account these new standards, and are expected to report their findings to the White House in February.

DOD and GSA released a report this week providing recommended baseline cybersecurity requirements aligning Federal cybersecurity risk management and acquisition processes. The goal is for the government to not buy products or services with inadequate built in cybersecurity. The report also recommends: (1) address cybersecurity when training the federal acquisition workforce, (2) use common cybersecurity definitions in federal acquisition regulations, (3) increase “government accountability” for cyber risk management, (4) institute a Federal Acquisition Cyber Risk Management Strategy, and (5) include a Requirement to Purchase from Original Equipment Manufacturers, Their Authorized Resellers, or Other “Trusted” Sources, Whenever Available, in Appropriate Acquisitions. DOD and GSA are now expected to develop an implementation plan that may be open to public comment.

A copy of the report can be found at:

http://www.vantagepointstrat.com/wp-content/uploads/2014/01/DOD-GSA-Report-Improve-Cybersecurity-Through-Acquisition-1-23-14.pdf

FY2015 Budget

The White House will release its FY15 budget request on March 4, a month after the deadline. Last week, the Office of Management and Budget (OMB) began doing passback to federal agencies. Passback usually occurs at the end of November. During passback, OMB sends its decisions on agency budget requests to the federal agencies and the agencies can appeal the decisions prior to the final budget proposal. The process was delayed due to the late conclusion of the FY14 appropriations process.

FY2015 Appropriations

It was reported this week that House and Senate Appropriators may consider pre-conferencing the 302(b) spending allocations for the 12 FY15 appropriations bills before writing and marking them up in their respective committees. Appropriators used a similar approach to successfully reach agreement on the FY14 omnibus. Normally, the committees determine their 302(b)s independently of each other, and then wait until conference to negotiate the difference between each bill (some of which end up being up to $40 billion apart). Senate Appropriations Chair Barbara Mikulski (D-MD) has said that she will use the FY15 topline spending level of $1.014 trillion that was agreed to in the budget resolution and not wait for Congress to pass an FY15 budget resolution. Hearings in the House and Senate Appropriations committees could begin before the President submits his budget to Congress in March.

House Appropriations Committee Chairman Hal Rogers (R-KY) this week announced the new rosters for the panel’s 12 subcommittees. Three Republican members – Rep. Martha Roby (R-AL), Rep. Mark Amodei (R- NV), and Rep. Chris Stewart (R-UT) – were assigned to the appropriations committee last month, but did not receive their subcommittee assignments until this week. All three were appointed to the Legislative Branch subcommittee. Stewart and Roby were also assigned to the Labor-HHS-Education subcommittee. Stewart was given a seat on the Interior-Environment subcommittee and Roby on Military Construction-Veterans’ Affairs. Amodei was also assigned to Commerce-Justice-Science and Financial Services subcommittees. Some other members already on the committee received new subcommittee assignments. New to the Defense subcommittee are Reps. Robert Aderholt (R-AL) and John Carter (R-TX). Rep. Mike Simpson (R-ID) got a seat on the Transportation HUD subcommittee and Rep. Tom Rooney (R-FL) joins the State and Foreign Ops subcommittee. And finally, the Energy and Water subcommittee welcomes Reps. Tom Graves (R-GA) and Jeff Fortenberry (R-NE).

Debt Ceiling

In his State of the Union Address, the President warned Congress to not use the debt ceiling as a negotiation tactic. Treasury Secretary Jack Lew has said that the debt ceiling will need to be raised by late February. Congress agreed to suspend enforcement of the debt limit until Feb. 7 in the deal passed last fall that reopened the federal government after the shutdown. The deal also allowed Treasury officials to use “extraordinary” measures to extend borrowing when the government approaches this new deadline. While Republicans are saying that they still want to get something in exchange for raising the debt limit, they have ruled out triggering a default. However, they may try to add policy riders including approval of the Keystone XL pipeline and changes to the Affordable Care Act, both of which could attract bipartisan support. The House could act on a debt limit bill as early as the second week in February, before they recess for the week of Presidents’ Day.

Political Updates

Rep. Henry Waxman (D-CA), the ranking Democrat (former chairman) on the House Energy and Commerce Committee and a 40-year veteran of Congress announced this week that he will not seek reelection in 2014. Rep. John Dingell (D-MI) is next in line and may be interested in returning as the top Democrat on the committee. Dingell was the chairman of the committee until 2009 when Waxman successfully challenged him for the position. While a number of House Minority Leader Nancy Pelosi’s (D-CA) close confidants, which includes Waxman, have decided to not seek reelection, Pelosi announced this week that she will be running again in 2014.

First term congressman Rep. Trey Radel (R-FL) submitted his letter of resignation to Speaker John Boehner (R-OH) on Monday after spending a month in a rehabilitation facility for alcoholism. Radel was caught buying cocaine from an undercover federal agent last October. Florida Governor Rick Scott (R) is expected to call for a special election, but has not set a date yet. The district is solidly Republican as Radel won it with 62% of the vote and Mitt Romney won it with 61% of the vote. Radel was on the Transportation and Infrastructure and Foreign Affairs Committees.

Secretary of Defense Chuck Hagel announced Vice Admiral Michael S. Rogers as President Obama’s nominee to be the next Director of the National Security Agency, chief of the Central Security Service, and commander of the US Cyber Command. Gen. Keith Alexander, the NSA Director since 2005, will retire March 14. Vice Adm. Rogers currently serves as the U.S. Fleet Cyber Command commander. While the NSA Director is not a Senate-confirmed position, Rogers will be called to testify before the Senate Armed Services Committee (SASC) and the hearing could become a venue for members to air their concerns over controversial NSA surveillance programs. The President also plans to appoint NSA’s chief operating officer, Richard Ledgett, to become its next deputy director.

The President made several other defense and homeland security nominations this week. Mike McCord was nominated for the position of Pentagon comptroller. He’s now the deputy comptroller and, earlier, had spent more than two decades working as a SASC staff member. McCord would take over for Robert Hale, who has held the position since Feb. 2009 and has expressed a desire to retire. Miranda Ballentine, Walmart’s director of sustainability and renewable energy, was nominated to be an Assistant Secretary of the Air Force for installations, environment and logistics, replacing Terry Yonkers who resigned. Brian McKeon was named to replace Kathleen Hicks as Principal Deputy Under Secretary of Defense. McKeon has been chief of staff of the National Security Staff and deputy national security adviser for Vice President Joe Biden. And Christine Wormuth, now deputy undersecretary of defense for strategy, plans and force development, was nominated to be Under Secretary of Defense for Policy, replacing James Miller, Jr. If confirmed, Wormuth would become the second woman to serve in the post, the first being Michèle Flournoy. And at DHS, Reginald Brothers, Jr. was nominated to be Under Secretary for Science and Technology replacing Tara O’Toole.

Next week, the House may consider a California drought bill and the Sportsmen’s Heritage And Recreational Enhancement Act, while the Senate will take up the farm bill conference report.

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