Washington Weekly – June 19, 2015

Washington Weekly

June 19, 2015

The House passed HR 2596, the FY16 Intelligence Authorization Act and HR 160, the Protect Medical Innovation Act, which repeals the 2.3% excise tax on medical devices. The House also voted 218 to 208 to grant the President fast-track authority to complete the Trans-Pacific Partnership. Backing the trade authority bill were 190 Republicans and 28 Democrats; 50 Republicans and 158 Democrats voted against it. The House rejected a resolution offered by Rep. Jim McGovern (D-MA) that would require the President to remove United States Armed Forces deployed to Iraq or Syria on or after August 7, 2014. The resolution failed by a vote of 139 to 288. The resolution was intended as a way of forcing action on an Authorization to Use Military Force against the Islamic State. The Senate passed the FY 16 National Defense Authorization Act and S 808, the Surface Transportation Board Reauthorization Act of 2105. The Senate also confirmed Matthew McGuire to be United States Executive Director of the International Bank for Reconstruction and Development and Gentry Smith to be Director of the Office of Foreign Missions. And the Senate passed two resolutions congratulating the Chicago Blackhawks on winning the 2015 Stanley Cup and the Golden State Warriors on winning the 2015 National Basketball Association Championships.

FY16 Appropriations

House

The House Appropriations Committee met this week to mark up their FY16 Interior and Financial Services spending bills in full committee and their FY16 Labor HHS Education and Agriculture spending bills in subcommittee.

Interior

The House Appropriations Committee marked up its $30.17B FY16 Interior spending bill this week. The bill is $246M below FY15 enacted levels and $3B below the President’s FY16 budget request. The bill was reported out of committee by a vote of 30 to 21 and will be considered on the House floor next week. The bill would permanently prohibit the EPA from developing or implementing any changes to its definition of “navigable waters” under the Clean Water Act, and would prevent the EPA from limiting greenhouse gas emissions from new and existing plants in FY16. Five amendments, in addition to a manager’s amendment, were approved during the full committee markup. The amendments are as follows:

  • Calvert – The Manager’s amendment makes technical and non-controversial changes to the bill and report. The amendment was adopted on a voice vote.
  • Visclosky –The amendment changes bill language requiring that all iron and steel used in water infrastructure projects be sourced within the United States. The amendment was adopted on a voice vote.
  • Amodei – The amendment adds report language clarifying the process for products to be designated as “made in America.” The amendment was adopted on a voice vote.
  • Jenkins – The amendment prohibits funding for the EPA to implement or administer updates to existing ozone regulations.The amendment was adopted on a vote of 31-20.
  • Cole – The amendment prohibits funding to implement, administer, or enforce a final rule titled “Hydraulic Fracturing on Federal and Indian Lands.” The amendment was adopted on a voice vote.
  • Valadao – The amendment adds report language relating to the Delta Smelt and directs the Fish and Wildlife Service to complete a five-year status review of the species, as required by law. The amendment was adopted on a voice vote.

OMB Director Shaun Donovan sent a letter to House Appropriations Committee Chairman Hal Rogers (R-KY) stating the Administration’s concerns with the bill including underfunding the Administration’s priorities and the inclusion of controversial policy riders.

House Appropriations FY16 Interior Bill Text:

http://appropriations.house.gov/uploadedfiles/bills-114hr-fc-ap-fy2016-ap00-interior.pdf

House Appropriations FY16 Interior Report Language:

http://appropriations.house.gov/uploadedfiles/hrpt-114-hr-fy2016-interior.pdf

OMB Director Shaun Donovan’s Letter to House Appropriations Chair Hal Rogers:

https://www.whitehouse.gov/sites/default/files/omb/legislative/letters/fy-16-house-interior-letter-rogers.pdf

Financial Services

The House Appropriations Committee marked up its $20.2B FY16 Financial Services spending bill this week. The bill is $1.3B below FY15 enacted levels and $4.8B below the President’s FY16 budget request. The bill was passed out of committee by a party line vote of 30 to 20. Eight amendments, in addition to a manager’s amendment, were approved during the full committee markup. The committee rejected amendments to eliminate restrictions on the SEC, FCC, and relations with Cuba as well as an amendment to allow DC to use local funds however its officials see fit reversing a long-standing ban on such funding going towards abortions. The amendments that were adopted are as follows:

  • Crenshaw – The manager’s amendment makes technical and non-controversial changes to the bill and report. The amendment was adopted on a voice vote.
  • Crenshaw – The amendment prohibits funding for the Financial Stability Oversight Council to designate non-banks as “systemically important financial institutions,” thereby imposing new regulations on their activities, without allowing non-banks to change their business practices prior to final designation. The amendment was adopted on a vote of 31-19.
  • Fattah – The amendment restores mail delivery standards to the July 1, 2012 level. The amendment was adopted on a vote of 26-23.
  • Culberson – The amendment prohibits funding for the IRS to audit a faith-based 501(c)3 organization, unless the audit is approved the IRS Commissioner.  The amendment was adopted on a vote of 30-19.
  • Womack – The amendment prohibits funding for the Consumer Financial Protection Bureau to issue a final rule on the use of arbitration until the Bureau conducts a thorough study. The amendment was adopted on a voice vote.
  • Quigley – The amendment adds report language encouraging GSA to incorporate bird safe materials and design features for GSA-owned federal buildings. The amendment was adopted on a voice vote.
  • Harris – The amendment stops the FCC  “joint sales agreements” rule for fiscal year 2016, which will allow local media outlets to continue to share equipment and advertising between stations. The amendment was adopted on a vote of 38-11.
  • Harris – The amendment prohibits funding for abortions through OPM-negotiated “multi-state qualified health plans” offered under Obamacare. The amendment was adopted on a vote of 29-18.
  • Palazzo – The amendment prohibits the District of Columbia from using federal or local funds to implement or enforce the Reproductive Health Non-Discrimination Amendment Act. The amendment was adopted on a vote of 28-22.

OMB Director Shaun Donovan sent a letter to House Appropriations Committee Chairman Hal Rogers (R-KY) stating the Administration’s concerns with the bill including provisions that would jeopardize the independence of financial regulators, diminish the enforcement capabilities of the IRS, make cuts to the GSA, and hinder implementation of the 2010 Affordable Care Act.

House Appropriations FY16 Financial Services Bill Text:

http://appropriations.house.gov/uploadedfiles/bills-114hr-fc-ap-fy2016-ap00-fservices.pdf

House Appropriations FY16 Financial Services Report Language:

http://appropriations.house.gov/uploadedfiles/hrpt-114-hr-fy2016-fservices.pdf

OMB Director Shaun Donovan’s Letter to House Appropriations Chair Hal Rogers:

https://www.whitehouse.gov/sites/default/files/omb/legislative/letters/fy-16-house-fsgg-letter-rogers.pdf

Labor HHS Education

The House Labor HHS Education Appropriations subcommittee marked up its $153B FY16 spending bill this week. The legislation includes funding for programs within the Department of Labor, the Department of Health and Human Services, the Department of Education, and other related agencies. The bill is $3.7B below FY15 enacted levels and $14.6B below the President’s FY16 budget request. The bill provides $11.7B for the Department of Labor ($206M below FY15, $1.4B below President’s FY16 budget request), $71.3B for the Department of Health and Human Services (($298M above FY15, but $3.9B below President’s FY16 budget request), $64.4B for the Department of Education ($2.8B below FY15, $6.4B below President’s FY16 budget request), $687.8M for the Corporation for National and Community Service, $445M for the Corporation for Public Broadcasting, $200M for the National Labor Relations Board, and $11.8B for the Social Security Administration. The bill also contains several controversial provisions that would defund the Affordable Care Act and restrict funding for abortions. The measure was reported out of subcommittee by voice vote. The full committee will consider the bill next Wednesday, June 24.

House Appropriations FY16 Labor HHS Education Draft Subcommittee Bill Text:

http://appropriations.house.gov/uploadedfiles/bills-114hr-sc-ap-fy2016-laborhhs-subcommitteedraft.pdf

Agriculture

The House Agriculture Appropriations subcommittee marked up its $20.65B FY16 spending bill this week. The legislation includes funding for agricultural and food programs and services, including food and medical product safety, animal and plant health programs, rural development and farm services, marketplace oversight, and nutrition programs. The bill is $175M below FY15 enacted levels and $1.1B below the President’s FY16 budget request. Including both discretionary and mandatory funding for various nutrition programs, the overall bill totals $143.9 billion ($3.8B below FY15 and $3.2B below the President’s FY16 budget request). The bill includes some contentious policy riders that would delay implementation of a federal menu labeling regulation and ensure e-cigarettes can continue to be sold without restrictions by the FDA’s Center for Tobacco Products. The measure was reported out of subcommittee by voice vote.

FY16 Agriculture Appropriations Draft Bill Text:

http://appropriations.house.gov/UploadedFiles/BILLS-114HR-SC-AP-FY2016-Agriculture-SubcommitteeDraft.pdf

Senate

The FY16 Defense Appropriations bill suffered a setback on the Senate floor this week after failing to garner 60 “ayes” in a procedural vote. Meanwhile, the Senate Appropriations Committee continued its work marking up their FY16 Interior and Homeland Security spending bills in subcommittee and full committee. The committee plans to mark up its FY16 Transportation-HUD and Labor-HHS-Education spending bills next week.

Defense

The $567B FY16 Defense Appropriations bill was brought up on the Senate floor yesterday, but hit an anticipated roadblock when Democrats voted against a procedural motion on the bill. The vote of 50 to 45 was 10 votes shy of the 60 votes needed to commence consideration of the bill. One Democrat, Sen. Joe Donnelly (D-IN) voted in favor of the procedural motion. Democrats are hoping that their move to block the bill (and all other future appropriations bills) will force Republicans to negotiate a bipartisan, multi-year budget agreement lifting the sequestration caps. Senate Democratic Leadership sent a letter to Senate Majority Leader Mitch McConnell (R-KY) on Thursday formally requesting another set of bipartisan budget negotiations similar to the round that resulted in the Ryan-Murray deal. At a Bloomberg event this week, House Appropriations Committee Chairman Hal Rogers (R-KY) commented on the Senate Democrats’ strategy, “It’s a dangerous game they’re playing – dangerous for the country and dangerous politically.” And, as expected, the White House has issued a veto threat in a Statement of Administration Policy released this week.

OMB Director Shaun Donovan’s Letter to Senate Appropriations Chair Thad Cochran:

https://www.whitehouse.gov/sites/default/files/omb/legislative/letters/senate-dod-appropriations-letter-cochran.pdf

White House Statement of Administration Policy on Senate FY16 Defense

Appropriations Bill:

https://www.whitehouse.gov/sites/default/files/omb/legislative/sap/114/saps1558s_20150618.pdf

Interior

The Senate Appropriations Committee marked up their $30.01B FY16 Interior spending bill in subcommittee and full committee this week. The bill is about $2.2B less than the President’s FY16 budget request. This is the first time since 2009 that an Interior bill has been marked up by the committee. The bill provides $11.05B for the Department of Interior, $1.18B for the Bureau of Land Management, $2.72B for the National Park Service, $1.43B for the US Fish and Wildlife Service, $1.06B for the US Geological Survey, $5.12B for the US Forest Service, $3.61B for the Wildland Fire Suppression, $4.77B for the Indian Health Service, $2.69B for the Bureau of Indian Affairs and Bureau of Indian Education, $819.5M for the Smithsonian Institution, $146M each for the National Endowment for the Arts and the National Endowment for the Humanities, $3M for the Council on Environmental Quality, and $7.6B for the EPA (including several policy riders for the agency). During full committee consideration, the panel adopted an amendment offered by Sen. Susan Collins (R-ME) for the Land and Water Conservation Fund and an amendment offered by Sen. Jerry Moran (R-KS) prohibiting the use of funds to implement or enforce the threatened species listing of the lesser prairie chicken under the Endangered Species Act of 1973. The bill was reported out of committee by a party line vote of 16 to 14.

Senate Interior Appropriations Bill Text:

Part 1: http://www.vantagepointstrat.com/?attachment_id=448

Part 2: http://www.vantagepointstrat.com/?p=449

Homeland Security

The Senate Appropriations Committee marked up their $47.09B FY16 Homeland Security spending bill in subcommittee and full committee this week. The bill is $765M above the FY15 enacted level and $1.02B below the President’s FY16 budget request. The bill provides $11.08B for Customs and Border Protection, $5.81B for Immigration and Customs Enforcement, $4.72B for the Transportation Security Administration, $10.33B for the US Coast Guard, $1.92B for the US Secret Service, $1.638B for the National Protection and Programs Directorate, $123M for the Office of Health Affairs, $7.37B for the Disaster Relief Fund and $929 for FEMA salaries and expenses, $120M for the US Citizenship and Immigration Services, $246M for the Federal Law Enforcement Training Center, $765M for the Science and Technology Directorate, $320M for the Domestic Nuclear Detection Office, and $1.1B for Departmental Management and Operations. In addition to a manager’s amendment that was adopted during the full committee markup, the committee also adopted an amendment offered by Sen. Mark Kirk (R-IL) that would permit the DHS Secretary to designate Poland as a program country under the visa waiver program. The committee rejected an amendment by Sen. Jeanne Shaheen (D-NH) seeking to add an additional $1.2B in funding to the bill. The bill was reported out of committee by a vote of 26 to 4.

Senate Homeland Security Appropriations Bill Text:

http://www.appropriations.senate.gov/sites/default/files/hearings/FY16%20Homeland%20Security%20Bill.pdf

Senate Homeland Security Appropriations Report Language:

http://www.appropriations.senate.gov/sites/default/files/hearings/FY16%20Homeland%20Security%20Report.pdf

Status of FY16 Appropriations Bills

Subcommittee House Action Senate Action
Agriculture Subcommittee: 6/18/15

Full Committee:

Floor:

Subcommittee:

Full Committee:

Floor:

Commerce-Justice-Science Subcommittee: 5/14/15

Full Committee: 5/20/15

Floor: 6/3/15

Subcommittee: 6/10/15

Full Committee: 6/11/15

Floor:

Defense Subcommittee: 5/20/15

Full Committee: 6/2/15

Floor: 6/11/15

Subcommittee: 6/9/15

Full Committee: 6/11/15

Floor:

Energy & Water Subcommittee: 4/15/15

Full Committee: 4/22/15

Floor: 5/1/15

Subcommittee: 5/19/15

Full Committee: 5/21/15

Floor:

Financial Services Subcommittee: 6/11/15

Full Committee: 6/17/15

Floor:

Subcommittee:

Full Committee:

Floor:

Homeland Security Subcommittee:

Full Committee:

Floor:

Subcommittee: 6/16/15

Full Committee: 6/18/15

Floor:

Interior-Environment Subcommittee: 6/10/15

Full Committee: 6/16/15

Floor: week of June 22

Subcommittee: 6/16/15

Full Committee: 6/18/15

Floor:

Labor-HHS-Education Subcommittee: 6/17/15

Full Committee: 6/24/15

Floor:

Subcommittee: 6/23/15

Full Committee:

Floor:

Legislative Branch Subcommittee: 4/23/15

Full Committee: 4/30/15

Floor: 5/19/15

Subcommittee:

Full Committee: 6/11/15

Floor:

Military Construction-VA Subcommittee: 4/15/15

Full Committee: 4/22/15

Floor: 4/30/15

Subcommittee: 5/19/15

Full Committee: 5/21/15

Floor:

State-Foreign Operations Subcommittee: 6/3/15

Full Committee: 6/11/15

Floor:

Subcommittee:

Full Committee:

Floor:

Transportation-HUD Subcommittee: 4/29/15

Full Committee: 5/13/15

Floor: 6/9/15

Subcommittee: 6/23/15

Full Committee:

Floor:

FY16 National Defense Authorization Act

The Senate passed their FY16 National Defense Authorization Act (NDAA) on the Senate floor this week by a vote of 71 to 25. This is the earliest the bill has passed the Senate in several years, and it is the first NDAA passed by the Senate in 3 years. Senate Armed Services Committee (SASC) Chairman John McCain (R-AZ) and House Armed Services Committee (HASC) Chairman Mac Thornberry (R-CA) said that they believe that they can wrap up conference on the bill and get it to the floor before the August recess. The question is whether or not President Obama will veto the final conference measure. The President issued veto threats for both the House and Senate NDAAs before their floor consideration objecting to the use of the Overseas Contingency Operations (OCO) accounts for an additional $38B in funding. The President may consider vetoing this high-profile piece of legislation to demonstrate how serious he is about wanting non-defense discretionary spending caps raised.

FY16 Intelligence Authorization Act

The House of Representatives approved its FY16 Intelligence Authorization (HR 2596) this week by a vote of 247 to 178. The bill authorizes classified amounts for 16 U.S intelligence agencies and intelligence-related activities of the U.S. government. The bill includes new reporting requirements to enhance Congress’ role in and understanding of the classification process. It also includes a new restriction on the Privacy and Civil Liberties Board barring its access information on covert actions and restrictions preventing the closing of the Guantanamo Bay prison. During floor consideration the House adopted several amendments, one of which was offered by Rep. Steve Israel (D-NY) that would require the Director of National Intelligence to provide a report to the Intelligence and Defense committees on the trends related to tunnel use by U.S. adversaries. The White House issued a veto threat for the bill in its Statement of Administration Policy objecting to the use of OCO funds to circumvent budget caps, the Guantanamo detainee provisions, provisions concerning the roles and responsibilities of the Cyber Threat Intelligence Integration Center (CTIIC), and certain reporting requirements in the bill.

Statement of Administration Policy on HR 2596, Intelligence Authorization Act for FY16

https://www.whitehouse.gov/sites/default/files/omb/legislative/sap/114/saphr2596r_20150615.pdf

Congressional Budget Office 2015 Long-Term Budget Outlook

The Congressional Budget Office (CBO) released its 2015 long-term budget outlook this week. The 2015 CBO outlook states that if current laws remain unchanged, the federal debt held by the public would decline slightly relative to GDP over the next few years but then start to grow caused by the aging population, rising health care costs, and an increasing number of recipients of healthcare exchange subsidies and Medicaid benefits. The federal debt would exceed 100% of GDP by 2040 and continue on an upward path relative to the size of the economy – a trend that CBO says is not sustainable. The policy changes needed to reduce the debt would become larger and larger over time. And because the rising debt could not be sustained indefinitely, the government’s creditors would begin to doubt its ability to cut spending or raise revenues, which could lead to the government paying much higher interest rates to borrow money. CBO analyzed the effects of three alternative fiscal policies – an extended fiscal scenario in which CBO projects the federal debt rising sharply to about 175% of GDP in 2040, a scenario in which budget deficits are smaller than those projected under current law in which CBO projects the federal debt at 72% of GDP in 2040, and a scenario with twice as much deficit reduction as the previous scenario in which CBO projects the federal debt would fall to 39% of GDP in 2040. In the first scenario, CBO assumed that Congress would repeal the discretionary spending caps and extend a host of temporary tax breaks without paying for them with other spending cuts or tax increases, thereby increasing the deficit by $2T over the next 10 years. Finally, the outlook provides analysis for choices for policymakers to put the federal budget on a sustainable path for the long term, choices that include major changes to tax policies, spending policies or both, and the timing for implementing new policies.

CBO 2015 Long-Term Budget Outlook:

https://www.cbo.gov/publication/50250

Political Updates

Two new Republican candidates threw their hats into the ring this week for the 2016 Presidential race – former Florida Governor Jeb Bush and businessman Donald Trump. They join the already crowded Republican field that includes Sen. Ted Cruz (R-TX), Sen. Rand Paul (R-KY), Sen. Marco Rubio (R-FL), Sen. Lindsey Graham (R-SC), former Texas Governor Rick Perry, former HP CEO Carly Fiorina, retired neurosurgeon Ben Carson, former Arkansas Governor Mike Huckabee, former NY Governor George Pataki, and former Sen. Rick Santorum (R-PA). And Ohio Governor John Kasich is expected to announce his candidacy in July. On the Democrat side, former Maryland Governor Martin O’Malley, former Rhode Island Governor and Senator (and former Republican) Lincoln Chaffee, former Secretary of State Hillary Clinton, and Sen. Bernie Sanders (I-VT) have all announced their candidacies.

In response to their votes against a rule governing debate on the trade bill last week, three Republicans were removed from the GOP Whip Team. Reps. Cynthia Lummis (R-WY), Steve Pearce (R-NM), and Trent Franks (R-AZ) were removed from the whip team based on longstanding whip team rules that stated members must “vote as a team on procedural matters” but are free to vote against leadership on underlying legislation.

President Obama nominated John Morton to be Executive Vice President of the Overseas Private Investment Corporation (OPIC). Morton is currently the Chief of Staff of OPIC.

At the Department of Defense, Peter Cook, a Washington correspondent for Bloomberg TV, has been chosen to be Pentagon press secretary for Defense Secretary Ash Carter. Cook succeeds Rear Adm. John Kirby, who stepped down after Secretary Carter told him that he preferred a civilian in the role. Claire Grady has been assigned as the Director of Defense Procurement and Acquisition Policy in the Office of the Under Secretary of Defense, Acquisition, Technology and Logistics. Grady previously served as the Deputy Assistant Commandant for Acquisition and Director of Acquisition Services for the U.S. Coast Guard.

Next Week

The House will consider the FY16 Interior-Environment Appropriations bill as well as H.R. 2042, the Ratepayer Protection Act of 2015, and H.R. 1190, the Protecting Seniors’ Access to Medicare Act of 2015 . This is the first time the Interior spending bill has been considered on the House floor since 2011. The Senate will take a series of votes on the House-passed Trade Promotion Authority vehicle (HR 2146) and on trade preferences legislation (HR 1295) with Trade Adjustment Assistance attached as an amendment. While the Senate passed these bills all together originally, they are now following the House and passing them separately. The Senate will also consider the nominations of Peter Neffenger to be an Assistant Secretary of Homeland Security and Daniel Elliott, III, to be a Member of the Surface Transportation Board.

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