Congress Update: Fall Outlook - NMHC | HomeCONGRESS UPDATE: FALL OUTLOOK. OVERVIEW: SHORT SEPTEMBER...

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Congress Update: Fall Outlook

LOREN DUGGAN Director of Legislative Analysis

CAMERON LEUTHY Senior Budget Analyst

STACY O’MARA Legislative Analyst

SEPT. 4, 2014

DANIELLE PARNASS Legislative Analyst

ADAM SCHANK Legislative Analyst

TIFFANY YOUNG Policy Analyst

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© 2014 Bloomberg Finance L.P.

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OVERVIEW: SHORT SEPTEMBER SESSION; LAME DUCK AHEAD

Congress returns from August recess on Monday, Sept. 8 » Target adjournment date in Senate is Sept. 23 » House could be in for as few as two weeks

Senate agenda: Democratic message bills, CR/omnibus, Ex-Im Bank, inversions House agenda: Republican message bills, CR, Obamacare, curbing regulations Most action will be delayed until the post-election, lame-duck session Topics include:

» Outlook for the September and lame-duck sessions » Overview of the picture going into the elections » Deadlines that will drive action in 2015 » A look ahead to next year’s budget process

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THE ONE MUST-PASS BILL IN SEPTEMBER: GOVERNMENT FUNDING

The one thing Congress must do in September is provide government funding for fiscal 2015, which begins Oct. 1 Most likely approach: a continuing resolution (CR) to extend current funding past the election

» Senate Appropriations Chairwoman Barbara Mikulski (D-Md.) said she wants to advance a 12-bill omnibus spending measure

» House leaders, including Speaker John Boehner (R-Ohio) and Appropriations Chairman Hal Rogers (R-Ky.), talking the CR route

One big question: What may hitch a ride on the CR?

» The administration and Congress will negotiate on a list of “anomalies” – funding that departs from the fiscal 2014 level and extensions of expiring authorities

» Some lawmakers have discussed using the bill to reauthorize or extend the Export-Import Bank of the United States (Ex-Im), which expires Sept. 30

» Some senators want language to stop the Postal Service from closing facilities Another big question: Will border spending be addressed?

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SENATE DEMOCRATS’ PLANS FOR SEPTEMBER: MIX OF MUST-PASS AND MESSAGING BILLS

Majority Leader Harry Reid has told senators he wants to leave town Sept. 23 » Threatened weekend work to meet that deadline

Messaging bills will dominate the agenda, including re-votes on prior legislation

» S. J. Res. 19, which would amend the Constitution to allow Congress and states to regulate campaign spending and contributions

» S. 2223, to increase the minimum wage to $10.10 in increments » S. 2432, to allow student-loan borrowers to refinance their loans » S. 2578, to reverse the Supreme Court’s Hobby Lobby decision and require all

employers to offer contraceptive coverage

May consider bill to reauthorize Ex-Im Bank » S. 2709 would reauthorize Ex-Im for five years, increase its lending limit » There may also be a vote on lifting ban on financing coal projects abroad

Other items that could come up:

» Defense authorization bill » Legislation to curb corporate inversions » Extension of ban on Internet access taxes (expires Nov. 1) » Satellite TV broadcast rules, also known as STELA (expire Dec. 31)

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HOUSE IN SEPTEMBER: ENERGY, JOBS PACKAGE, OBAMACARE, TAXES

New Majority Leader Kevin McCarthy (R-Calif.) sent a memo to colleagues outlining his plans for September

» A single “jobs bill” that combines legislation already passed by the House, such as tax measures, regulatory reductions

» An energy bill that combines previously passed measures » H.R. 3522, which would allow health insurers to resume selling, on an indefinite

basis, group plans they offered in 2013

Other items on the agenda could include: » H.R. 5078, to limit the EPA and Army Corps of Engineers from expanding

definition of waters subject to Clean Water Act requirements » H.R. 647, tax-free savings accounts for disabled individuals, known as “ABLE Act” » A vote on the estate tax; Ways and Means Chairman Dave Camp (R-Mich.) said

many members haven’t had a chance to vote on it » Additional tax extender bills

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EXTERNAL EVENTS MAY AFFECT AGENDA

Islamic State (ISIS/ISIL) » House Foreign Affairs Chairman Ed Royce (R-Calif.) and Ranking Member Eliot

Engel (D-N.Y.) planning hearing with Secretary of State John Kerry » Could vote in coming weeks on approving engagement beyond 60 days

Russia and Ukraine

» Additional hearings, resolutions remain possible Iran nuclear negotiations

» Some members want legislation as the administration has held talks

Any further developments along the U.S.-Mexico border Continued oversight of the Veterans Affairs Department

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HOUSE: REPUBLICANS HAVE 233-199 ADVANTAGE; ALL 435 SEATS UP FOR GRABS THIS FALL

Democrats would need a net gain of 17 seats to take control of the House; conventional wisdom is that Republicans will retain the majority

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SENATE: 55 IN DEMOCRATIC CAUCUS, 45 IN GOP; DEMOCRATS DEFENDING MORE SEATS (21-15) IN FALL

A net gain of six seats would give Republicans control of the Senate; Democrats would retain control if there’s a 50-50 Senate

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SENATE MAP FAVORS REPUBLICANS AS DEMOCRATS RUN IN DIFFICULT PLACES*

Democrats are defending seats in seven states that Mitt Romney won in 2012

» West Virginia (R +26.8%): open seat • John D. “Jay” Rockefeller retiring

» Arkansas (R +23.7%) : Mark Pryor » South Dakota (R +18%): open seat

• Tim Johnson retiring » Louisiana (R +17.2%): Mary Landrieu » Alaska (R +14%): Mark Begich » Montana (R +13.7%): open seat

• Appointed Sen. John Walsh left race » North Carolina (R +2%): Kay Hagan

Other tough races in states Obama won:

» Colorado: Mark Udall » Iowa: open seat (Tom Harkin retiring) » Michigan: open seat (Carl Levin retiring) » New Hampshire: Jeanne Shaheen

Only one Republican is running in a state that Barack Obama won in 2012

» Maine (D +15.3%): Susan Collins • She’s not considered vulnerable

Two key races in Romney states where Republicans are defending seats

» Kentucky: Mitch McConnell » Georgia: open seat

• Saxby Chambliss retiring

Democrats (21 seats up) Republicans (15 seats up)

*Percentages of Romney and Obama support are Bloomberg calculations using official returns provided by state election boards. Note: See appendix for all Democratic-held and Republican-held seats up in 2014. There are 33 regularly scheduled elections and three special elections: in Hawaii, where appointed incumbent Brian Schatz, a Democrat, is defending his seat; in Oklahoma, where Republican Tom Coburn is retiring before his term expires; and in South Carolina, where appointed Senator Tim Scott, a Republican, is running to keep his seat.

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POST-ELECTION WORK COULD DEPEND ON SENATE CONTROL NEXT YEAR

Status quo in Senate may mean more gets done in lame-duck; action likely on: » Omnibus appropriations » Export-Import Bank » Other expiring authorities

Their calculus: Do we wait until we control both chambers to address government spending, other issues?

» Most major tasks probably delayed to 2015 » Depending on length of CR, an additional funding extension may be necessary » Spending reductions, policy riders in omnibus become more likely

If Democrats keep the Senate

If Republicans win the Senate

Some items probably will advance this fall » Intelligence authorization » Renewal of tax provisions that expired in December 2013 or will expire this year » Defense authorization, to avoid breaking 52-year streak of passing the bill » Terrorism Risk Insurance Act (TRIA) reauthorization ahead of Dec. 31 deadline

Regardless of who wins

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THINGS THAT PROBABLY WON’T GET DONE THIS YEAR

Major cybersecurity legislation, such as the House-passed CISPA » Possible action on critical infrastructure protection, research and workforce bills

Immigration overhaul probably won’t happen

» There could be action on deportation of DREAMers, unaccompanied minors Corporate tax overhaul or smaller changes such as curbing inversions Education reauthorizations, such as No Child Left Behind or higher education Major changes to Dodd-Frank Trade promotion authority, also known as fast-track Postal Service overhaul proposals Patent troll legislation Fannie Mae and Freddie Mac legislation

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MAJOR DEADLINES COMING EARLY IN 2015

March 15: End of suspension of debt limit » Treasury Department can use “extraordinary measures” to keep government

operating until debt limit raised » About $1 trillion increase needed to get through election in 2016, based on

CBO projections (BNA) » In the past, Republicans have used debt-limit deadlines to force debate on

spending policies; GOP control of both chambers would increase their leverage

March 31: “Doc fix” that blocks cuts to Medicare physician payments expires » There was a bicameral, bipartisan solution this year to permanently fix the issue » Didn’t advance because of lack of agreement on “pay fors” » House passed H.R. 4015 in March; CBO estimated $138.4 billion, 10-year cost » Senate bill, S. 2110, included other extensions, had a total cost of $180.2 billion

May 31: Expiration of surface transportation programs

» No easy way to pay for long-term bill with gas-tax increase off the table » Previous “pay fors” – such as the extension’s pension smoothing and transfers

from general fund – harder to use for multiyear bill

https://www.bgov.com/news_item/U6VkCLfaUi7BXlVCPj_Yjw?etReferrerLink=Budget_20140902

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FISCAL 2016 BUDGET PROCESS: WHAT TO WATCH

Timing of president’s request » Technically due the first Monday in February » Could be delayed if the fiscal 2015 process lingers into next year

Budget Control Act: Will more changes be sought?

» The budget deal between Sen. Patty Murray (D-Wash.) and Rep. Paul Ryan (R-Wis.) didn’t increase budget caps in fiscal 2016

» Possible effort to raise defense cap, especially in a Republican Senate

Budget resolution: Return to regular order » Joint GOP control would make agreeing on a budget blueprint much easier » Allows party to draw a contrast with the president and Democrats

Reconciliation process: GOP could force Obama to veto their ideas

» Budget resolution could require committees to report spending and tax cuts » Resulting legislation would be protected from Senate filibuster, though any non-

budgetary provisions could be removed through points of order » Possible targets: Medicare, food stamps, Dodd-Frank, tort overhaul (as in 2012)

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ABOUT THE ANALYSTS (1)

Loren Duggan is Bloomberg Government's Director of Legislative Analysis and contributes to BGOV's Congress Tracker, which he helped develop. He was editor of Congressional Quarterly's House Action Reports, providing summaries and analysis of legislation. He also contributed to CQ's legislative tracking services and product development during his decade there. Loren holds bachelor’s degrees in political science and psychology from American University. Follow Loren on Twitter: @loren_duggan

[email protected] +1 202 416 3396

Cameron Leuthy is a Senior Budget Analyst with Bloomberg Government. He has more than 20 years of experience in analyzing budgets and legislation at the Office of Management and Budget, the Department of Defense, and at Booz Allen Hamilton. His expertise includes the federal budget and the nexus of national security policy, operational requirements and funding. He has a bachelor's degree from Western Washington University and an MPA from the University of Washington. Follow Cameron on Twitter: @CLeuthy


Stacy O'Mara is a Legislative Analyst with Bloomberg Government. Previously she worked on federal budget development, cybersecurity, defense and veterans' health-care issues as a contractor for the Departments of Defense and Homeland Security. She also worked at Booz Allen Hamilton, advising company leaders on the business implications of federal and congressional budget activities. She has a bachelor’s degree in political science from Virginia Tech and a master’s degree in public policy from George Mason University. Follow Stacy on Twitter: @stacyomara


mailto:[email protected]



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ABOUT THE ANALYSTS (2)

Danielle Parnass is a Legislative Analyst with Bloomberg Government. Previously, she researched tax and budget issues for the Senate Finance Committee and analyzed the impact of legislation on the private sector at the Congressional Budget Office. She has also performed legislative analysis and covered hearings and markups at Congressional Quarterly. Danielle has a master of public policy degree from Georgetown University and a bachelor's degree in journalism and government from the University of Maryland. Follow Danielle on Twitter: @dparn22


Adam Schank is a Legislative Analyst with Bloomberg Government. Previously, he was an analyst for Congressional Quarterly's House Action Reports, where he wrote summaries and analysis of legislation. He analyzed federal regulatory proposals relating to pollution control, energy development and utilities for CQ Legal. Schank has a bachelor's degree in political science from the University of Minnesota and a master's degree from the University of Minnesota - Duluth. Follow Adam on Twitter: @Schank_A


Tiffany Young is a Policy Analyst with Bloomberg Government, focusing on tax issues. She previously worked at Ernst & Young’s Quantitative Economics and Statistics practice, where she advised Fortune 500 and government clients on the impact of economic and tax policies. Young also worked as a consultant with PricewaterhouseCoopers and the New Jersey Legislature. She has an MBA from Yale University and a BA in economics from Emory University. Follow Tiffany on Twitter: @tiffanycyoung





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APPENDIX

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21 DEMOCRATIC-HELD SENATE SEATS UP IN 2014 COMPARED WITH 2012 PRESIDENTIAL VOTE

State Seat up in 2014 2012 presidential winner 2012 margin West Virginia Jay Rockefeller (retiring) Romney 26.8% Arkansas Mark Pryor Romney 23.7% South Dakota Tim Johnson (retiring) Romney 18.0% Louisiana Mary Landrieu Romney 17.2% Alaska Mark Begich Romney 14.0% Montana John Walsh (appointed, dropped bid) Romney 13.7% North Carolina Kay Hagan Romney 2.0% Virginia Mark Warner Obama 3.9% Colorado Mark Udall Obama 5.4% New Hampshire Jeanne Shaheen Obama 5.6% Iowa Tom Harkin (retiring) Obama 5.8% Minnesota Al Franken Obama 7.7% Michigan Carl Levin (retiring) Obama 9.5% New Mexico Tom Udall Obama 10.1% Oregon Jeff Merkley Obama 12.1% Illinois Dick Durbin Obama 16.9% New Jersey Cory Booker Obama 17.8% Delaware Chris Coons Obama 18.6% Massachusetts Ed Markey Obama 23.1% Rhode Island Jack Reed Obama 27.5% Hawaii Brian Schatz (appointed) Obama 42.7%

*Percentages of Romney and Obama support are Bloomberg calculations using official returns provided by state election boards. Note: The list includes a special election in Hawaii, where appointed incumbent Brian Schatz is defending his seat.

Seven seats, highlighted in gray below, are in states won by Mitt Romney

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15 REPUBLICAN-HELD SENATE SEATS UP IN 2014 COMPARED WITH 2012 PRESIDENTIAL VOTE

State Seat up in 2014 2012 presidential winner 2012 margin Maine Susan Collins Obama 15.3%

Georgia Saxby Chambliss (retiring) Romney 7.8%

South Carolina (2) Lindsey Graham, Tim Scott (appointed) Romney 10.5%

Mississippi Thad Cochran Romney 11.5%

Texas John Cornyn Romney 15.8%

Tennessee Lamar Alexander Romney 20.4%

Kansas Pat Roberts Romney 21.7%

Nebraska Mike Johanns (retiring) Romney 21.8%

Alabama Jeff Sessions Romney 22.2%

Kentucky Mitch McConnell Romney 22.7%

Idaho Jim Risch Romney 31.9%

Oklahoma (2) Tom Coburn (resigning), Jim Inhofe Romney 33.5%

Wyoming Mike Enzi Romney 40.8%

*Percentages of Romney and Obama support are Bloomberg calculations using official returns provided by state election boards Note: List includes two special elections: in Oklahoma, where Republican Tom Coburn is retiring before his term expires, and South Carolina, where appointed Senator Tim Scott, a Republican, is running to keep his seat.

One seat, highlighted in gray below, is in a state won by Barack Obama

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Congress Update: Fall Outlook - NMHC | HomeCONGRESS UPDATE: FALL OUTLOOK. OVERVIEW: SHORT SEPTEMBER...

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