December 9, 2014

Closing Out the 113th Congress

Before the end of the year, the Senate must take up three important bills to deal with hard deadlines. These include a continuing resolution to fund the government beyond the current deadline of December 11; authorization for continued defense spending; and legislation to extend expiring tax provisions.

Omnibus/Continuing Resolution

The central issue of the omnibus/CR revolves around proposals to use the appropriations process to stop the president’s executive actions on immigration. The nature of the funding stream for U.S. Citizenship and Immigration Services makes such an effort complex. There is no legal or constitutional barrier, however, and Congress has taken similar action before.

Total discretionary spending subject to Budget Control Act caps

Total discretionary spending subject to Budget Control Act caps

* Does not include OCO, emergency, disaster, or program integrity funding

USCIS is almost entirely fee-funded. Those immigration-related fees are placed into special funds in the U.S. Treasury and spent on related costs. That means USCIS and other fee-funded agencies will operate as long as there is a permanent statute that allows them to use the funds and there is no temporary statute restricting the use of these funds. USCIS does have such a permanent statute, though the agency can only continue the specific activities funded by the permanently-appropriated user fees. It cannot use the fees for any activity not expressly allowed by an existing law. Congress can restrict the ability of a fee-funded agency to use its fees for certain activities by including language to this effect in an appropriations bill or a separate statute. Congress has done this many times, including restrictions on USCIS in the fiscal year 2014 omnibus. Those restrictions were not as contentious as the limits proposed for this year’s omnibus/CR.

Any such restriction in this year’s omnibus/CR or other legislation would require the president’s signature or the votes to override his veto. Without that change in law, the vast majority of USCIS operations would still operate.

Defense Authorization

This will be the fifth year in a row the Senate will consider the final version of the defense authorization bill in a December rush. Last year the Senate only considered two amendments to the Senate Armed Services Committee version of the bill before all debate on the bill was shut down. This year the Senate never even considered the committee’s version of the bill, which was reported out on May 23, 2014, by a vote of 25-1.

Waiting until the last moment to consider Defense authorization

aiting until the last moment to consider Defense authorization

Of note, the bill will be used as a vehicle for provisions unrelated to national security. It will include a package of public lands, wilderness, parks, and energy bills. Although rare, this is not the first time the defense authorization process has been used to attach policy preferences unrelated to Pentagon policy.

Some of the more notable provisions of the final version of the fiscal year 2015 defense authorization bill include:

  • Authorization to train and equip Syrian opposition forces. The bill does not include an authorization for the use of force in counter-ISIL operations.
  • Authorization to train and equip Iraqi Security Forces.
  • Prohibition on the transfer of Guantanamo detainees to the United States.
  • Increase in Tricare pharmaceutical co-payments.
  • Rejecting the president’s request to conduct a BRAC round.
  • Authorization of appropriations consistent with the Budget Control Act, as amended by the 2013 Bipartisan Budget Act (Ryan-Murray). Sequestration continues to have a devastating impact on military readiness.

Each of these provisions merit debate. Instead, under Senator Reid’s leadership, consideration of the bill containing all of these provisions, and much more, will be compressed into mere hours without any opportunity for amendment.

Tax Extenders

Many temporary tax provisions expired at the end of 2013. Senate Majority Leader Reid and House Ways and Means Chairman Camp were close to a negotiated deal to extend many of these tax provisions for two years and make several provisions permanent. The White House threatened to veto that deal, saying the deal would “help well-connected corporations while neglecting working families.” That was despite the fact that President Obama has signed extensions of these bipartisan corporate provisions before.

After the White House ended hope for a larger deal, the House passed its extenders bill (H.R. 5771) by a vote of 378-46. This bill would extend for one year nearly all of the provisions that expired in 2013, as well as two provisions regarding multi-employer pensions that expire at the end of 2014. The bill also includes technical corrections to current tax law and repeal of “deadwood” provisions that are no longer applicable. The JCT reports the tax extenders portion of the bill has a score of $41.6 billion from 2014-2024, including a deficit increase of $81.4 billion in fiscal year 2015. Compared to a 2013 current policy baseline, however, the bill does not increase deficits.

Compared to the Senate Finance Committee’s tax extenders bill, the House bill omits two provisions that expired in 2013. First is a provision on the health care tax credit that allows the ability of Trade Adjustment Assistance or Pension Benefit Guaranty Corporation recipients to get a refundable tax credit to pay for 72.5 percent of health insurance premiums for themselves and their families. In the Senate Finance bill, this provision had a cost of $134 million from 2014-2024, of which $106 million is increased outlays. Second, the House bill omits a 10 percent credit for electric motorcycles. This provision is favored by Finance Committee Chairman Wyden, though his provision was not a clean extension of this credit either. The Finance Committee bill extended the credit only for two-wheeled vehicles and allowed the credit for three-wheeled vehicles to expire.

Before transmitting the bill to the Senate, the House added the text of H.R. 647, the Achieving a Better Life Experience (ABLE) Act. The ABLE Act is a new proposal that is more than fully offset and would allow states to establish a savings program for the benefit of disabled people. The accounts would operate similar to higher education savings, or “529,” accounts. An ABLE account can be set up for any eligible resident of a state that establishes an ABLE program, and this account can receive after-tax contributions from anyone. Gains earned inside the account will not be taxed, and funds from the account may only be used for the qualified disability expenses of the eligible person. The ABLE Act passed the House by a vote of 404-17. JCT also reports that the ABLE Act, attached to H.R. 5771 after passage of both bills, would reduce deficits by $33 million from 2015-2024. The combined tax extenders/ABLE Act would have a total deficit increase of approximately $41.57 billion.

Issue Tags: National Security, Economy