McDonald Hopkins Government Strategies Advisory: This Week in Washington -- July 24, 2015
Transportation Bill advances in Senate
On Wednesday, the Senate passed an important procedural hurdle, voting for cloture by a vote of 62 to 36. Despite the vote, hurdles remain for the bill.
The Senate bill under consideration would extend the highway trust fund for six years, but provides funding for only the first three years. The pay-fors the Senate does identify include a $16.3 billion proposal derived from cutting dividends paid by the Federal Reserve to large banks, another $9 billion would come from a drawdown and sale of excess oil in the Strategic Petroleum Reserve.
The bill also generates $1.9 billion from extending mortgage lenders' guarantee fees that were set to drop, $4 billion by indexing customs fees to inflation, and $3.5 billion by changing where fees from the Transportation Security Administration go, among others. The bill also gets money through changes to the estate tax, mortgage-lending requirements, and by rescinding unused funds from the stimulus package.
While the cloture vote is a good sign for supporters of the bill, the Senate now must deal with contentious amendments on immigration, the Affordable Care Act, guns, the re-authorization of the Export-Import Bank, and the defunding of Planned Parenthood.
To avoid a messy flurry of divisive amendments, Sen. Mitch McConnell might employ a parliamentary procedure known as "filling the tree" that would allow for a vote on the Export-Import bank reauthorization - something McConnell has promised to Senate Democrats - but would avoid votes on other amendments.
Congress only has until the end of the month to extend the fund that reimburses states for transportation projects. No matter what happens in the Senate, leaders on both sides of the aisle in the House say a long-term reauthorization is not happening; both Democrats and Republicans in the lower chamber prefer a short-term extension.
The Highway Trust Fund is primarily funded through an 18.4-cent-per-gallon federal gas tax that hasn't been raised since 1993. Despite more fuel-efficient vehicles and the fund consistently threatening to run dry, raising the tax was a nonstarter for Republicans and some Democrats.
Is another government shutdown looming?
House Democrats think so and are urging their Republican counterparts to start working with them to find a way to avoid another shutdown.
Agencies are only currently funded through September, and with Congress set to recess for the entire month of August, there are very few legislative days left to negotiate and vote on a funding bill. Already, lawmakers are pessimistic Congress can move forward without a temporary provision to maintain the status quo on agency spending that would freeze any new projects.
At a press conference this past Tuesday, House Democrats sounded the warning bell. Despite GOP efforts to pass all the appropriations bills, Democrats say that a continuing resolution may be necessary to keep the government open.
The Republican-led House has passed several of the 12 requisite appropriations bills for fiscal year 2016, but those appear to be nonstarters, as President Barack Obama has threatened to veto any spending measure that does not reverse the cuts required by the 2011 Budget Control Act. Even that largely-for-show process has hit a standstill as Republicans decide how to proceed with a rider on the display of confederate flags at national parks.
Democrats called on House Speaker John Boehner and Sen. McConnell to appoint a bipartisan commission to negotiate an agreement to fund agencies past September. A similar group—composed of Republican Rep. Paul Ryan and Democratic Sen. Patty Murray—was able to stave off sequestration in 2014 and 2015 through a series of alternate savings agreed to in 2013.
Watch the latest Washington Business Brief video, LaTourette Talks Transportation and Energy
Congress eyes bipartisan energy bills
The House Energy and Commerce committee has been among the most active and successful committees in either chamber, racking up a series of impressive legislative accomplishments. Now the committee turns its attention to a comprehensive energy bill, something that has eluded Congress for years.
The 95-page bill that House Republicans unveiled late Monday night, however, might not be as comprehensive as many had hoped. Indeed, it side-steps many controversial issues, including the Keystone XL pipeline, offshore drilling, and the repeal of the crude export ban.
The bill, which many have referred to as a “first step,” passed out of subcommittee unanimously this week.
Instead of diving head-first into some of the most controversial fights, the bill focuses on issues like electricity reliability by expanding the use of smart grids, expediting natural-gas infrastructure, improving cybersecurity language, and expanding workforce training.
It’s not by accident that the bill the committee produced avoids the hot button issues. Energy and Commerce members wanted a bipartisan agreement, at least to kick off the process, and bipartisanship on energy is hard to come by once you take even a small step into the details.
The broad agreement over this non-controversial “first step” isn’t likely to last. Members and staff will use the August recess to hash out a bigger bill, with the hopes of bringing it to the full committee in September. And there will be no shortage of big-ticket items competing for a spot.
Meanwhile, the Senate also unveiled a bipartisan energy bill this week. The bill was released by Sen. Lisa Murkowski (R-AK), Chair of the Senate Energy and Natural Resources Committee, and Sen. Maria Cantwell (D-WA), the committee's ranking member.
The 300-page legislation would set a deadline for the federal government to decide on applications to export liquefied natural gas, indefinitely renew the government’s key conservation funding program, and push toward an electric grid that is better prepared for cybersecurity and renewable energy, among other provisions.
Like the House bill, the Senate legislation avoids many of the thornier energy issues like crude oil export and the XL pipeline.
The committee is likely to begin debating the legislation next week, which includes provisions that would eliminate outdated or redundant mandates, encourage energy efficiency in federal and commercial buildings, modernize the electric grid and shore up its ability to adjust to an increase in renewable energy, among other policies.
While the bill includes top GOP priorities like natural gas exports, it also includes projects important to Democrats like the indefinite renewable of the Land and Water Conservation Fund and electric grid improvements.
Desperate to find revenue – Congress considers selling oil
Finding new sources of revenue in today’s Washington has become an almost Herculean effort, which is why some are now seeking to tap the Strategic Petroleum Reserve. The federal government currently holds some 700 million barrels of oil as a hedge against disaster or war.
The Senate’s proposed highway bill calls for selling 101 million barrels to raise $9 billion to help pay for the chamber's transportation legislation. Two weeks ago, the House voted to sell 64 million barrels over eight years to help pay for an overhaul of the federal drug-approval process.
Not everyone is thrilled with this new found enthusiasm for selling off portions of the Strategic Petroleum Reserve. Sen. Lisa Murkowski, Chair of the Senate Energy and Natural Resources Committee, joined with Democrats on Tuesday to block the chamber's highway bill because she objected to selling oil to pay for it. That measure later cleared a procedural hurdle Wednesday evening.
But with Congress desperate to find sources of revenue, and with tax increases completely off the table, the oil reserve may prove too tempting for legislators to say no to.
Supporters of the sales include Senate Majority Leader Mitch McConnell (R-KY), who has proposed using the proceeds to help pay for the six-year highway and transit bill, and House Energy and Commerce Chairman Fred Upton (R-MI), whose panel approved selling oil to raise $5.2 billion for a streamlined Food and Drug Administration approval process.
Tapping the reserve allows the Republican-controlled Congress to stick to its pay-as-you-go budgeting rule, even though the measure in the transportation bill assumes the oil sales would reap $90 a barrel, nearly double the current U.S. price.
Republicans seek to defund Planned Parenthood
In little more than a week, a pair of videos aiming to serve as a Planned Parenthood exposé has ignited a debate over the organization's funding that hangs ominously over congressional activity.
Almost immediately after the video, which depicts a Planned Parenthood doctor talking about the exchange of fetal tissue, was released, the House announced committee investigations and lawmakers began talking about eliminating the group's federal funding.
After a second video was released this week, things heated up: Sens. Ted Cruz and Rand Paul, who are competing for the Republican presidential nomination, filed defunding amendments to bipartisan highway legislation that's already struggling to gain momentum in the upper chamber.
On Wednesday, Republican lawmakers in the House and Senate filed stand-alone defunding bills. And 50 senators—49 Republicans and Democrat Joe Manchin—sent a letter to the Health and Human Services Department, calling on it to comply with investigations into Planned Parenthood.
Democrats are on the offense as well, criticizing the group that taped the conversation with the Planned Parenthood official.
Several House members signed a letter Wednesday asking Attorney General Loretta Lynch and California Attorney General Kamala Karris to investigate the legality of the actions of the group that produced what they deem "selectively edited" videos.
The most plausible vehicle for passing a Planned Parenthood-defunding measure is the highway legislation, as it's considered a must-pass bill. But even if the Senate gets a vote on that, Majority Leader Mitch McConnell will have to choose between benefitting presidential candidates and getting a bipartisan deal through, since it guarantees Democrats will bail on the larger bill.
Many doubt McConnell will allow a vote on any amendment to defund Planned Parenthood. The organization receives roughly $530 million per year from the federal government, which is more than a third of the group’s $1.3 billion budget.
Current law, however, bars federal funding for abortion, except in the cases of rape, incest, or threat to a woman's life.
Abortions account for only three percent of total services at Planned Parenthood, according to the organization. On the other hand, 90 percent of services offered are preventive and include cancer screenings, birth control, and STD testing and treatment. Of the 2.7 million people it serves a year, 78 percent of them are at or below 150 percent of the poverty level, the group says, and 1.5 million people who used Planned Parenthood services receive health coverage through Medicaid.
Transportation in Focus
NYC Mayor vs. Uber
New York City Mayor Bill de Blasio has been engaged in a high-profile fight with the popular Uber car service. A cease fire was reached this week, at least temporarily ending hostilities between the mayor and the company.
According to an agreement reached by the two sides, New York City will conduct a four-month study on the effect of Uber and other car service companies like Lyft. Uber has agreed to release data on usage in exchange for city hall agreeing to drop plans to place a cap on the number of vehicles the company operates in New York City.
The city has suggested that car companies like Uber may be responsible for traffic jams in the city, particularly in Manhattan. It is a claim that Uber has rejected, instead claiming that the mayor’s attacks on the company are politically motivated, and done at the behest of the city’s traditional taxi cab companies.
The battle between Uber and de Blasio has been an ugly one, as both sides have attempted to portray the other as operating in bad faith. The fight even drew in celebrities like Kate Upton and Neil Patrick Harris, who weighed in on social media on behalf of Uber. Before the announcement on Wednesday, the aggressive, rollicking debate over Uber showed few signs of fading. Across social media, the company found its arguments reinforced on the Twitter accounts of Upton, Harris, Ashton Kutcher, and other infrequent participants in the municipal taxi dialogue.
Florida 13th Congressional District: Former Gov. Charlie Crist (D-Fla.) made his intentions clearer Monday, writing on Twitter, "If the new congressional map includes my home, I intend on running to serve the people again."
New Hampshire 1st Congressional District: A WMUR poll shows a grim outlook for Rep. Frank Guinta (R-N.H.), finding that only 5 percent would definitely vote for Guinta's reelection.
Utah 4th Congressional District: Attorney and 2014 candidate Doug Owens (D-Utah) announced he will challenge Rep. Mia Love (R-Utah) in 2016. Love represents a deep red district and had $619,000 in cash at the end of the second quarter, but she beat Owens by just 3 percentage points in 2014, a strong Republican year.
Arizona: Sen. John McCain (R-Ariz.) raised $1.2 million in the second quarter and had $4.5 million cash on hand. Rep. Ann Kirkpatrick (D-Ariz.) raised $433,000 in her first month as a Senate candidate and had $638,000 cash on hand.
Florida: Former state Attorney General Bill McCollum (R-Fla.) said he is "interested" in exploring a Senate bid, but that he won't be able to put much thought into it until September.
Pennsylvania: Katie McGinty (D-Pa.), chief of staff to Gov. Tom Wolf (D-Pa.), is resigning her current position in preparation for a Senate bid. She will face former Rep. Joe Sestak (D-Pa.).
Louisiana: A Market Research Insight poll conducted sometime in late June shows state Rep. John Bel Edwards (D-La.) with a surprising lead over the Republican field, taking 30 percent to Sen. David Vitter's (R-La.) 24 percent, Public Service Commissioner Scott Angelle's (R-La.) 14 percent, and Lt. Gov. Jay Dardenne's (R-La.) 12 percent.
FOX News Debate: The Fox News Republican presidential forum on Aug. 6, the consolation prize for the candidates who don’t make the top 10 cut for the prime time debate that night, is being moved to 5 p.m. and shortened to one hour. The move to 5 p.m. will give the candidates a far greater audience than they would have had at midday — the channel's 5 p.m. ratings are nearly double the daytime average — and will allow Fox News to transition directly from the forum into its pre-debate coverage.
John Kasich (R-Ohio): Gov. John Kasich became the newest entrant into the crowded GOP field, announcing his candidacy this week in Columbus, Ohio.
Donald Trump (R-N.Y.): GOP front-runner Donald Trump came under fire over the weekend when he questioned whether or not Sen. John McCain (R-Ariz.), a former Vietnam POW, was a war hero. Despite the controversy, which brought an immediate rebuke from other candidates and the RNC, polling continues to show Trump on top of the 2016 GOP field. Also this week, Trump threatened a third party run if he wasn’t “treated fairly” by the GOP.
Rand Paul (R-Ky.): Sen. Rand Paul released a video this week in which he burns pages of the U.S. tax code, puts them in a woodchipper, and takes a chainsaw to them.
Joe Biden (D-Del.): Vice President Joe Biden said he will make a decision about whether or not to seek the Democratic nod for president by the end of the summer.
A LOOK AHEAD
Tuesday, July 28
10 a.m. House Financial Services Committee – Hearing. Full committee hearing on "Dodd-Frank Five Years Later: Are We More Prosperous?"
10 a.m. House Foreign Affairs Committee – Hearing. Full committee hearing on "Iran Nuclear Agreement: The Administration's Case."
10 a.m. House Energy and Commerce Committee – Hearing. Oversight and Investigations Subcommittee hearing on "Continuing Concerns with the Federal Select Agent Program: Department of Defense Shipments of Live Anthrax."
10 a.m. House Science, Space, and Technology Committee – Hearing. Full committee hearing on "Exploration of the Solar System: From Mercury to Pluto and Beyond."
10 a.m. House Budget Committee – Hearing. Full committee hearing on "First Principles of Congressional Budgeting."
10 a.m. House Education and the Workforce Committee – Hearing. Full committee hearing on "Reviewing the Policies and Priorities of the U.S. Department of Health and Human Services."
10 a.m. House Judiciary Committee – Hearing. Crime, Terrorism, Homeland Security and Investigations Subcommittee hearing on "America's Growing Heroin Epidemic."
10 a.m. House Ways and Means Committee – Hearing. Health Subcommittee hearing on rural health care disparities created by Medicare regulations.
10 a.m. House Natural Resources Committee – Hearing. Energy and Mineral Resources Subcommittee hearing on "Federal Implementation of the Coastal Zone Management Act."
10 a.m. House Natural Resources Committee – Hearing. Oversight and Investigations Subcommittee hearing on "Accountability, Policies, and Tactics of Law Enforcement within the Department of Interior and Forest Service."
10 a.m. House Transportation and Infrastructure Committee – Hearing. Coast Guard and Maritime Transportation Subcommittee hearing on H.R.1684, the "Foreign Spill Protection Act"; and the "National Icebreaker Fund Act of 2015."
10:15 a.m. House Energy and Commerce Committee – Hearing. Communications and Technology Subcommittee hearing on "Continued Oversight of the Federal Communications Commission."
2 p.m. House Homeland Security Committee – Hearing. Cybersecurity, Infrastructure Protection and Security Technologies Subcommittee hearing on "Promoting and Incentivizing Cybersecurity Best Practices."
2 p.m. House Ways and Means Committee – Hearing. Select Revenue Measures Subcommittee hearing on "Reform of the Multiemployer Pension System."
2 p.m. House Oversight and Government Reform Committee – Hearing. National Security Subcommittee hearing on "Impact of the Boycott, Divestment, and Sanctions Movement."
3 p.m. House Foreign Affairs Committee – Hearing. Asia and the Pacific Subcommittee, Terrorism, Nonproliferation, and Trade Subcommittee and Middle East and North Africa Subcommittee hearing on "The Iran-North Korea Strategic Alliance."
Wednesday, July 29
10 a.m. House Homeland Security Committee – Hearing. Full committee hearing on "Aviation Security Challenges: Is TSA ready for the threats of today?"
10 a.m. House Judiciary Committee – Hearing. Courts, Intellectual Property and the Internet Subcommittee hearing on "Internet of Things."
10 a.m. House Agriculture Committee – Hearing. Full committee hearing on "Dodd-Frank Turns Five: Assessing the Progress of Global Derivatives Reforms."
10 a.m. House Natural Resources Committee – Hearing. Full committee hearing on "Federal Agencies' Selective Enforcement of Endangered Species Act Consultation."
10:30 a.m. House Veterans' Affairs Committee – Markup. Full committee markup of pending legislation.
Tuesday, July 28
10 a.m. Senate Homeland Security and Governmental Affairs Committee – Hearing. Full committee hearing on "Avoiding Duplication: An Examination of the State Department's Proposal to Construct a New Diplomatic Security Training Facility."
10 a.m. Senate Banking, Housing and Urban Affairs Committee – Hearing. Full committee hearing on "Lifting the Crude Oil Export Ban."
Wednesday, July 29
9 a.m. Senate Health, Education, Labor and Pensions Committee – Hearing. Full committee hearing on "Reauthorizing the Higher Education Act: Combating Campus Sexual Assault."
10 a.m. Senate Homeland Security and Governmental Affairs Committee – Markup. Full committee markup to vote on the nomination of Denise Roth to be administrator of the General Services Administration; the "Department of Homeland Security Border Security Metrics Act of 2015"; the "Critical Infrastructure Protection Act of 2015"; the "EINSTEIN Act of 2015"; S.1073, the "Stop Improper Payments to Deceased People Act"; the "Quarterly Financial Reporting Reauthorization Act of 2015; S.1607, the "Independent Agency Regulatory Analysis Act of 2015"; S.1526, the "Construction Consensus Procurement Improvement Act of 2015"; S.1820, the "Early Participation in Regulations Act"; S.1817, the "Smarter Regulations Through Advance Planning and Review Act"; S.1808, the "Northern Border Security Review Act"; S.779, the "Fair Access to Science and Technology Research Act of 2015"; S.Res.104, to express the sense of the Senate regarding the success of Operation Streamline and the importance of Prosecuting first time illegal boarder crossers; S.708, the Regulatory Improvement Act of 2015"; S.1170, the "Breast Cancer Research Stamp Reauthorization Act of 2015"; H.R.1531, the "Land Management Workforce Flexibility Act"; and postal facility naming bill S.1596.
2:15 p.m. Senate Indian Affairs Committee – Hearing. Full committee hearing on "Examining the True Costs of Alcohol and Drug Abuse in Native Communities."
2:30 p.m. Senate Veterans' Affairs Committee – Hearing. Full committee hearing on "Ending Veteran Homelessness."
Thursday, July 30
9:30 a.m. Senate Homeland Security and Governmental Affairs Committee – Hearing. Investigations Subcommittee hearing on "Impact of the U.S. Tax Code on the Market for Corporate Control and Jobs."
WASHINGTON BY THE NUMBERS
$431 million – The amount of money earned by Donald Trump in the last 18 months, according to filings with the FEC.
$1.7 billion – The net worth of Jim Justice (D-W.Va.), who is running for the Democratic nomination for governor in the Mountaineer state. His $1.7 billion net worth makes him the richest man in the state of West Virginia.
44 – The percentage of voters in New Hampshire’s 1st Congressional district who believe that Rep. Frank Guinta (R-N.H.) should resign.
IN THEIR OWN WORDS
“He doesn’t seem like a very bright guy. He actually probably seems to me not as bright as Rick Perry. I think Rick Perry probably is smarter than Lindsey Graham,”—Donald Trump (R-N.Y.) just prior to reading out Senator Lindsey Graham’s private cell phone number to a crowd at an event in South Carolina.
"I think Donald Trump is a political car wreck and people slow down and look at the wreck but they eventually move on. I believe when it comes to winning a national election as a republican Donald Trump is not the pathway forward," – Senator Lindsey Graham (R-S.C.) after Donald Trump revealed his private cell phone number at an event in South Carolina.
“Let no one be mistaken – Donald Trump’s candidacy is a cancer on conservatism, and it must be clearly diagnosed, excised and discarded. It cannot be pacified or ignored, for it will destroy a set of principles that has lifted more people out of poverty than any force in the history of the civilized world – the cause of conservatism.” – former Texas Gov. Rick Perry (R-Texas).
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