Viewing posts categorised under: Quick Hits

Quick Hit – November 9, 2016

by Gene Moran in Quick Hits

One of the most scrutinized election seasons in American political history finally concluded last night, and its immediate implications for upcoming legislation and policy direction cannot be understated. The political establishment has been put on notice that long-simmering issues such as immigration policy, the national debt, trade, size-of-government, and wage disparity, to name a few, must be addressed in a different and more urgent manner.  Few recognized the depth and breadth of unrest within the electorate.

Of note, as relates to doing business with the US government customer, the process by which funds flow to departments and agencies remains the same.Knowing how, when and where to address needs, requirements, resourcing, budgets, appropriations and contracting remains unchanged by the election results.

The House

Despite losing some seats, Republicans have maintained their majority in the House. The challenge in the coming legislative days for Speaker Paul Ryan will be to ensure that there is, in fact, a governing majority that can pass legislation. With a highly charged freedom caucus still firmly in place on the right, achieving the necessary 218 votes to pass legislation will routinely require significant Democratic support. Overall, expect to see a continued trend of difficult votes and special procedural maneuvers used on each side to achieve certain gains.

The Senate

Control of the Senate remained in question until the final moments of this election cycle. Similarly to the presidential race, there were several key contests that made the race especially interesting: New Hampshire, Pennsylvania, Missouri, North Carolina and Florida.The razor thin margin by which Republicans have maintained control (51 – 47, with Louisiana holding a run-off on December 10th and New Hampshire Democrat Hassan leading at the time of this post) will assure that new policies will not simply be steam-rolled through Congress. In recent years, while in the minority, Democrats have successfully stalled or prevented passage of bills on demand. Working through this complex dynamic will require significant political skill.

The Lame Duck Session

Congress will return to the Hill on November 14th with a difficult laundry list facing them. Look for appropriations issues to dominate the headlines well into December.

Appropriations

To date, the VA/MilCon appropriation is only one of 12 FY17 spending bills to be enacted – it provided the legislative vehicle for the Continuing Resolution (CR). The CR will expire on December 9th, putting pressure on the remaining bills. With 11 appropriations bills left to complete in just 16 scheduled legislative days, an omnibus appropriations bill that rolls multiple spending bills into one is the most likely outcome. Recall that Speaker Ryan ran for his Speakership on a platform that vowed to avoid such giant spending deals because of their typically unclear final negotiations.

Supplemental Appropriations

Further complicating the budget dialogue is the Department of Defense and its role in the process thus far. The DoD has raised the specter of requesting a much larger “supplemental” appropriation in addition to the present FY17 bills under consideration. Many had expected a request of approximately $3 billion to forward in March 2017. The DoD has recently signaled a request closer to $6 billion, and has pushed up the timeline to before March. They have sent mixed signals as to exactly what needs this supplemental funding would address. DoD Comptroller Mike McCord says that need is $6 billion, whereas Secretary of Defense Carter contradicts his subordinate by suggesting the final figure is “not settled.” Chairman McCain says any supplemental funding shouldn’t be allocated solely for war funding, but must be used for the “total force” in order to address readiness and personal needs in addition to the foundational costs. This debate within the debate will significantly impact the passage of the FY17 omnibus.

Justice Against Sponsors of Terrorism (JASTA)

The bill previously passed both chambers with ease but was subsequently met with a veto from President Obama. It survived a swift veto override vote, the first delivered to President Obama. The popularity of the provisions allowing survivors of 9/11 to pursue justice carried the day. Now that we recognize some unintended consequences of the original bill, look for Congress to quietly insert some revisions to the bill into a lame duck legislative vehicle – this will likely be in the omnibus. Look for broader review of JASTA in the new Congress in January.

Supreme Court Nominee

The nomination of President Obama’s choice for the Supreme Court to replace the late Justice Scalia, Merrick Garland, will likely die and simply not be taken up before the 114th Congress concludes. . Look for President Trump to select a Supreme Court candidate from his previously released list of potential candidates.

Presidential Transition and Change of Government

President-elect Trump will make over 4,000 appointments to government positions, of which more than 1,000 will require Senate confirmation. This process of filling executive vacancies will take several months.

Future Quick Hits will address the new administration and the ongoing dynamic!

 

 

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Quick Hit – September 29, 2016

by Gene Moran in Quick Hits

In the eleventh hour before breaking for the election recess, both chambers approved legislation to fund the government through December 9th and address key issues that had stalled its earlier passage.

 

Wednesday afternoon the Senate passed its stopgap funding measure with a 72-26 vote; the bill would include a prominent $1.1 billion towards combating Zika as well as $500 million to states suffering from natural disasters, along with its primary function of funding the government and avoiding shutdown. Initially met with resistance from House Democrats, a bipartisan Water Resources Development Act (WRDA) pushed the bill forward.

 

On Wednesday evening the House passed the aforementioned WRDA to address the crisis in Flint, Michigan with federal funding that will go towards drinking water infrastructure and aid. The bill passed overwhelmingly with a 399-25 vote, after an added amendment detailing $170 million in aid passed 284-141. The House version differs from the Senate version, in that the House version authorizes the spending and the Senate is looking to appropriate funding. The House WRDA will be part of a much larger conference for the Senate’s package that includes Army Corps of Engineers projects, transportation and environmental restoration provisions. Look for this conference to happen when Congress returns after the election, as well as further discussion on the specifics of the Flint crisis.

 

The WRDA significantly opened the way for an agreement to clear the impasse between the two chambers after clever work from House Speaker Paul Ryan, Senate Majority Leader Mitch McConnell and Minority Leader Nancy Pelosi. The final bill passed with a 72-26 vote from the Senate and 342-85 in the House.

 

The quick and decisive movement of this bill is coming directly following both chambers’ vote to override the president’s veto of the Saudi Arabia bill, which allows for families of 9/11 victims to sue Saudi Arabia.

 

Senators and Representatives, having tied up all loose ends last night, will now make their way back to the campaign trail to focus on elections, and will return to the Hill during the lame-duck session in November after the election.

 

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Quick Hit – September 21, 2016

by Gene Moran in Quick Hits

The Senate voted overwhelming on cloture (decision to limit further debate to 30 hours) on the motion to proceed for the “shell” of a continuing resolution to fund the government through December 9th.

The vote was an overwhelming 89-7, easily surpassing the required 60-vote threshold to avoid filibuster. While the bill could still meet opposition later on, this move suggests at last the contours of a short-term spending agreement.

As with all CR actions, businesses with federal contracts should make the extra effort to assure their federal customer understands any special circumstances associated with he contract’s funding mechanisms.

Some of the most prominent issues at stake in the bill are transportation, campaign finance and Internet domain rights. The majority of discussion and debate, however, has centered on the bill’s provision for Zika funding (around $1.1 billion). The bill moved through after Senators removed language that would block Planned Parenthood’s partner clinic in Puerto Rico from accessing federal grants, considered a win for Democrats. It is looking more and more likely that the bill will not include relief funding for the contamination crisis in Flint, Michigan or for the flooding in Louisiana. Expect debates on these riders to continue this week, and potentially be revisited during the post-election lame duck session.

Also, late yesterday, Leader McConnell signaled to expect a Senate vote to override a threatened presidential veto on recently passed legislation allowing families of 9/11 victims to sue Saudi Arabia. The President has until Friday to veto the bill. An override vote would take place next week.

 

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Quick Hit – September 8, 2016

by Gene Moran in Quick Hits

As the Labor Day weekend came to a close, both chambers returned to Capitol Hill to proceed with legislative deliberation for FY17. With the end of the fiscal year quickly approaching, Congress must come to an agreement on the conclusion of appropriations bills. Among the most significant, in both size and breadth, is the Defense Appropriations bill.

What is the status of the defense bills?

Defense Appropriations
Before the recess, the Senate defense appropriations bill was unable to proceed to floor action as Democrats raised concerns about spending levels.  Hoping to avoid a government shutdown, Senate Majority Leader Mitch McConnell has signaled he will advance a short-term continuing resolution (CR) to fund the government through December 9th. The CR would also allow more time for the Senate to solidify a position on Zika funding. While House Republicans have yet to publicly reveal their intentions, they will meet behind closed doors on Friday to discuss the newly presented option. Some more conservative House GOP members have even suggested a CR that pushes the timeline into next year, perhaps into March 2017. As of this writing, it is unlikely a CR would extend that long.

As partisan differences continue to create obstacles for the legislative process, this week thePentagon attempted to speed up the process by undercutting the House GOP’s budget plans, led by House Speaker Paul Ryan. The strategy attempts to pit both chambers against each other using pressure from top military officials to underline how the GOP’s budget is hurting national defense. The plan, while bold, is not wholly unexpected; Defense Secretary Carter has been vocal about his opposition to the $18 billion funds taken from a war purse (the OCO account) in a time of war. The most likely outcome at this stage is an omnibus appropriation after the election.

Defense Authorization
The NDAA, which was left in staff conferencing before the recess, is not likely to complete conference before the fiscal year-end and the election break at the end of September. The House and Senate positions on topline funding remain too far apart. Other issues like increased troop strength, increasing wages and hardware acquisition are challenging, but are likely to be resolved. Look for high-profile meetings of Armed Services Chairmen McCain and Thornberry throughout September to keep political heat on the process.

Senate Races

The majority in the Senate hangs in the balance by a few very competitive seats this November. The “top” of the ticket can influence several specific races.

The top five most competitive races with incumbent Republicans to watch heading into November:

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Official Portrait

Florida: Rep. Patrick Murphy (D) (top) is challenging Republican incumbent Senator Marco Rubio (bottom).


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Official Portrait

Illinois: Rep. Tammy Duckworth (D) (top) is challenging Republican incumbent Senator Mark Kirk (bottom).

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Official Portrait

New Hampshire: Governor Maggie Hassan (D) (top) is challenging Republican incumbent Senator Kelly Ayotte (bottom).

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Pat_Toomey,_Official_Portrait,_112th_Congress

Pennsylvania: Katie McGinty (former Environmental Advisor to Vice President Al Gore and Bill Clinton and former Chief of Staff to PA Governor Tom Wolf) (top) is challenging Republican incumbent Senator Pat Toomey (bottom).

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Wake Forest University hosts a reception and banquet to honor recipients of the Distinguished Alumni Award, at Winmock on Friday, April 19, 2013.  Award winner Sen. Richard Burr ('78).

North Carolina: Deborah Ross (former Member of North Carolina House of Representatives and attorney) (top) is challenging Republican incumbent Senator Richard Burr (bottom).

 

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Quick Hit – August 5, 2016

by Gene Moran in Quick Hits

The calm before the presidential election storm has begun as the confetti finally settled and both parties’ conventions came to a close last week. With Congress in recess and both presidential nominations firmly in place, now is the perfect opportunity to do a brief recap of where the year has taken us thus far and where we see the legislative path turning in the coming months.

Several events have conspired to bring the legislative process to an effective standstill: the extended Congressional recess through Labor Day; limited scheduled legislative days remaining (21); and, the election quickly approaching in November.  It is highly unlikely that any appropriations bill will get to the President’s desk before the election.

What has happened in 2016 so far?

Appropriations subcommittees in both houses have been busy over the weeks leading up to the current recess, but the movement of House bills through committee overshadows those of the Senate. Here’s the summary of progress in both chambers (defense listed in separate table below):

The Senate:

  • Commerce/Justice/Science – committee approved 30-0 (4/21/16)
  • Energy/Water – initial Senate passage 90-8 (5/12/16)
  • Agriculture – committee approved 30-0 (5/19/16)
  • Legislative Branch – committee approved 30-0 (5/19/16)
  • VA/MILCON – initial Senate passage 89-8 (5/19/16)
  • Transportation HUD – initial Senate passage 89-8 (5/19/16)
  • Homeland Security – committee approved 30-0 (5/26/16)
  • Labor HHS – committee approved 29-1 (6/9/16)
  • Interior-Environment – committee approved 16-14 (6/16/16)
  • Financial Services – committee approved 30-0 (6/16/16)
  • State-Foreign Operations – committee approved 30-0 (6/29/16)
  • Military Construction, Veterans Affairs, and Related Agencies subcommittee was resolving differences on its appropriations bill before the break

The House:

  • Agriculture 5054 – committee approval voice vote (4/19/16)
  • Legislative Branch – initial House passage 295-129 (5/19/16)
  • Agriculture 5393 – committee approval voice vote (5/24/16)
  • State-Foreign Operations – committee approval voice vote (5/24/16)
  • Labor/HHS/Education – initial House passage 233-175 (6/10/16)
  • Commerce/Justice/Science – initial House passage 282-138 (6/16/16)
  • Financial Services – committee approval voice vote (6/22/16)
  • Energy/Water – initial House passage 239-185 (7/7/16)
  • VA/MILCON – committee approval voice vote (7/12/16)
  • Homeland Security – initial House passage 231-196 (7/14/16)
  • Interior-Environment – committee approval 31-19 (7/14/16)

Defense bills recap…

After rejecting a proposed amendment from the House on the FY17 National Defense Authorization Act, the Senate agreed to move the bill to conference when the recess ends after Labor Day. The Senate began instructing its conferees during its last session, most notably including the bill’s sponsor, Senator McCain, and the recently popularized Senator Tim Kaine of Virginia.
The $18 billion shift of OCO funds into the base budget contained in the House version of the NDAA will be the primary point of contention of the September conference. As OCO funding is not subject to congressional discretionary spending ceilings, many Democrats feel that the bill uses OCO inappropriately as a gambit to raise overall defense spending. The House version of the NDAA will attempt to force the President’s hand in passing a resolution to raise defense spending and override the budget caps set in 2011 and reaffirmed in 2015. House Republicans are hoping that shifting funds from OCO will reveal how low the base budget has become; Republicans have recently been underlining the need for increased funding in order to match President Obama’sincreased troop posture in Afghanistan, expressing their frustration that the latter has happened without the former. While an increase in defense spending is a mutually shared goal between both parties, the Democratic administration and its congressional representatives are emphasizing the importance of adhering to the Bipartisan Budget Act of 2015 in which any increase in funding must be distributed equally between defense and non-defense areas.

Going hand in hand with the NDAA are the appropriations bills coming out of the SAC-D and the HAC-D, which would provide the funding for the provisions, detailed in the NDAA. While the House bill has moved along without a hitch, the Senate version has encountered more obstacles; Senate Democrats have prevented it from moving to a floor vote. The bill failed to proceed after a 55-42 vote two weeks ago. SAC Chairman Thad Cochran (R-Miss) commented, “The Senate has a responsibility to give our men and women in uniform the resources they need to defend our nation. We do so in this bipartisan bill. Filibustering its consideration causes uncertainties that endanger our national security…” Senate Democrats are resisting what they see as extremely partisan provisions in the appropriations bill, holding up its progress. The Senate leaders must be able to persuade votes after the recess if the bill is to survive. This standstill will very likely lead to an omnibus bill before the year is up in order to avoid a government shut down.

Recap of defense bills progress:

Screen Shot 2016-08-04 at 11.21.39 PM

Looking ahead…

Pressure will build in September to find short-term relief in a Continuing Resolution that buys time until after the election November 8th.  Elections have a way of clarifying the “trade space” and focusing the political options. Look for a much-maligned Omnibus before Christmas.

Longer term (early 2017), look for a smaller (less than $10B) additional Overseas Contingency Operations (OCO) supplemental appropriation.

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Quick Hit – July 11, 2016

by Gene Moran in Quick Hits

What Does It Mean…

A continuing resolution (CR) to fund the government through the end of the calendar year is increasingly likely as the appropriations process grinds to a standstill. As it stands, the House and Senate only have this week left to work on legislation before breaking for the summer to focus on campaigns and the party conventions. Once Congress returns, there will only be 21 legislative days before the election in which to finish all the remaining bills. To date, the House has passed 6 of 12 individual appropriations bills; the Senate has only passed 3 of the 12 required spending bills.  Open talk of an Omnibus appropriation, rolling all 12 bills into one Trillion-plus-dollar spending bill, may already be heard on the Hill.

Last Week Before Extended Summer Recess…

Legislative business in the House and Senate resumes today, ringing the last week before a long summer recess until after Labor Day in September.

 

The House…

At the end of last week, the House moved forward in a procedural vote to move the National Defense Authorization Act to conference.

Speaker Paul Ryan approved the NDAA progress, saying:

“This legislation gives our military the tools and funding it needs to do its job and keep Americans safe. It also gives our men and women in uniform a well-deserved raise. If there’s anyone who deserves an increase in pay, it’s those who risk their lives every day for the safety of this country. “

The conferees, named by Speaker Ryan last Friday, will meet in a conference committee to discuss a final, combined version of the NDAA bill this Wednesday.  Staff-level conferencing is has already begun.  Committee leaders of SASC and HASC acknowledge the bill will not complete conference before the Summer recess.

The House also continued moving forward on individual appropriations bills with the Labor/HHS moving out of subcommittee by voice vote and the Financial Services appropriations bill clearing the House floor by a largely partisan vote of 239-185.

 

The Senate…

The Senate experienced another flare up last week when Senate Democrats voted down a motion to proceed to debate on the Senate Defense Appropriations Bill. Lingering controversy over the maneuver to transfer OCO money to the base budget in the House version of the bill, and continued frustration over a lack of funding for the Zika virus, prompted Democrats to vote down the measure. This move effectively stalls the appropriations process in the Senate for the moment.

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Quick Hit – June 24, 2016

by Gene Moran in Quick Hits

An Unprecedented Week…

This week has been full of surprises for domestic and international politics; the House Democrats staging a sit-in, the Supreme Court rulings on immigration and affirmative action, the UK decision to leave the European Union…

 

What Does It Mean For Appropriations?

It means an already slow appropriations season has been slowed even further as challenging political issues force their way into already limited legislative time in both chambers.

 

The Senate

Last week, the Senate delegation from Connecticut led a 15 hour filibuster on the Commerce, Justice, Science, and Related Agencies Appropriations Bill. The bill remains in limbo, with amendments still pending.

Next week, on Tuesday, the State, Foreign Operations, and Related Programs Subcommittee will begin its markup of the FY17 Appropriations bill. The full Appropriations Committee is scheduled to take up the bill on Thursday.

It is hoped Senate defense appropriations will proceed to the Senate floor before the July 15th summer recess.

 

The House

The House Democrats staged a historic and highly controversial sit-in on the well of the House floor Wednesday into Thursday. Lost in the hype is that a tool exists for issues that can’t seem to get out of committee but Members believe would survive a majority vote on the floor – a discharge petition to bring a vote straight to the House floor requires 218 signatures. However, a discharge petition would not have attracted the same media attention, as did the sit-in. The House majority voted to end the legislative day late Wednesday night, begin a new day to vote on the VA/MILCON Appropriations Conference Report, and then go on Fourth of July recess a day early. The VA/MILCON legislation passed without debate.

Here is the breakdown of the House VA/MILCON bill:

  • $82.5 billion discretionary spending ($2.6 billion above FY16)
  • $1.1 billion funds for resources to fight Zika virus ($1.1 billion came from the Senate bill version, the House originally passed a $622 million measure)

Democrats were extremely opposed to the measure, and embittered after the House majority passed the bill without debate in a late night session. The Zika funding aspect of the bill will prove challenging to conference with the Senate. Senator Bill Nelson of Florida labels the Zika element of the bill “a disaster.”

With partisan tensions high when the House reconvenes on July 5, it is expected that the Financial Services Appropriation will move to the House floor.

 

In summary

Chances of finished appropriations bills before Congress goes on an extended recess until Labor Day are quite low.

 

Legislative Days Until Summer Recess:

Senate: 11 Days Left

House: 9 Days Left

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Quick Hit – June 20 2016

by Gene Moran in Quick Hits

Last Week…

The House passed its version of the FY17 Defense Appropriations Bill, and the Senate passed its version of the FY17 National Defense Authorization Act.

The House defense appropriations bill is noteworthy for its redistribution of $18 billion from OCO funds to the base budget. The Obama administration has openly opposed this measure, and the president has threatened a veto. The other problem facing the House bill is that the corresponding Senate defense plan, only reflected in the NDAA so far, does not follow this same tactic, setting up a challenging conference scenario.

On Friday, the House floor was overwhelmed with debate on numerous amendments to the bill. Of note were two amendments related to Guantanamo, one that prohibits the transfer of Guantanamo prisoners to U.S. facilities and another that bans federal funds from investigating the possibility of building a new facility for Guantanamo detainees in the U.S.

Up next for the House are consideration of appropriations bills for Financial Services and General Government and VA/MILCON.

House and Senate Defense Legislation:

Screen Shot 2016-06-20 at 10.26.23 AM

 

 

 

 

 

 

 

 

 

 

 

 

The Senate…

The Senate passed its NDAA bill, which Senate Majority Leader Mitch McConnell had previously said he wanted done before the appropriations bill. The NDAA followed the SASC subcommittee mark, which aligned with the president’s original budget request. The bill stands out by including for the first time in U.S. history a provision to include women in the draft. Another standout was the failure of John McCain’s amendment to add an additional $18 billion to overall defense spending. Although the measure failed, Senator Lindsey Graham and other supporters have expressed their intent to continue the push for high spending levels during appropriations considerations.

Movement of Senate defense appropriations to the Senate floor had been anticipated last week, prior to Senate Democrats taking control of the floor for much of a day to express lingering concerns over Congressional inaction on revised gun laws.  Senate defense appropriations should proceed to floor action this week.

The continued disconnect between House and Senate defense spending policy for FY17, the upcoming presidential conventions, and the political turmoil in the aftermath of the tragic events in Orlando bode for slow progress on the appropriations schedule. It is unlikely we will see any of these bills proceed to conference prior to the July break for the presidential conventions.

The Capitol…

In other news, the restoration project on the Capitol Dome is moving along at good speed. The scaffolding has moved down to the base of the dome, and the whole project is expected to be completed by the January Presidential Inauguration.

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Quick Hit: June 13, 2016

by Gene Moran in Quick Hits

Votes Continue, But At A Slow Pace

The Senate…

Last Friday, the Senate voted in a 68-23 decision to proceed to the next step in the voting process on the FY17 National Defense Authorization Act. This motion will allow 30 more hours of debate to consider amendments, of which there are many, before moving to a final vote.

Key Points:

During Friday’s rounds of debate, an amendment put forth by SASC Chairman John McCain that would have raised overall defense spending by $18 billion was voted down. A similar effort from the Democrats to raise defense and non-defense spending by $18 billion was also rejected. This means that the 2011 Budget Caps have been reaffirmed, at least for now.

Remaining Amendments:

There are hundreds of amendments up for consideration on the FY17 NDAA bill. The McCain amendment was one of the principals, now that it has been rejected the two most contentious ones that remain are Sen. Kristin Gillibrand’s amendment to remove military chain of command on sexual assault cases and Sen. Jeanne Shaheen’s amendment to issue visas to Afghan soldiers and translators who have served alongside US military.

Obama’s Veto Threat:

Earlier last week the Obama administration said the president would consider a veto on the Senate NDAA if it included an amendment that would prevent him from closing Guantanamo Bay. However, today, Reuters released a report stating President Obama has ruled out using an executive order to override a Congressional ban on closing Guantanamo. Lack of legal grounding and a fast-approaching election makes an executive order imprudent, according to the administration, and also means the president will likely not meet his goal of closing the facility before the end of his presidency.

The House…

The House is scheduled to take up consideration of the FY17 Defense Appropriations bill tomorrow. The primary part of the bill that has been cause for serious debate it its shift of OCO defense funds to the base budget, thus shortchanging the full OCO budget and betting on a presidential request for more defense funding next year. The maneuver is not popular amongst Democrats or the Obama administration, and seriously threatens a presidential veto if it survives to the final version of the bill.

Appropriations Running Behind…

At this rate, the Senate has passed two appropriations bill and the House has passed one and rejected one. It is likely that the tradition of a “catch-all” bill at the end of the year to prevent a government shutdown is upon us once again.

Coming Up…

This is a busy time of year for the appropriations process. Stay tuned for developments this week, and expect another Capitol Integration “Quick Hit” update next week.

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Quick Hit – May 27, 2016

by Gene Moran in Quick Hits

Disruptions to the Appropriations Process….

The smooth path to FY17 appropriations successes in the House ground to halt as the energy and water appropriations bill was voted down yesterday due to an amendment regarding LGBT rights. As Speaker Paul Ryan stated after the bill’s failure:

“When I became speaker one of the commitments I made to our members was to open up this process. That means … more amendments from both sides of the aisle. It means fewer predetermined outcomes and, yes, more unpredictability.”

An open amendment process for appropriations was a key element of Speaker Ryan’s agreement with Republican factions upon assuming the Speakership. Many lawmakers are already predicting that more controversial amendments and failure to individually pass the 12 necessary spending bills will require a continuing resolution at the end of the year.

How the Appropriations Should Go…

Usually, the appropriations bills reported by the House and Senate in May continue to advance through early June, and move to floor consideration throughout the summer. Both chambers typically aim to finish consideration of appropriations bills before the August recess, although the Senate process sometimes continues through the fall — this year’s August recess begins in mid-July due to the Presidential conventions. The fall and winter have recently been dominated by negotiations to reconcile the differences between the appropriations bills passed in each chamber. Debates between Senate, House, and the administration to find an acceptable compromise is what often prompts the passage of continuing resolutions to a prevent government shutdown at the end of the year.

At this early phase of the process, given the differences in the bills, a desire by Democrats to match any defense increase with non-defense increases, and the potential for politically charged amendments (LGBT rights, for example), it will once again be an exciting process. 

Business leaders should be communicating with their government customer regularly in order to understand the mutual implications of a CR on their specific programs.

The Four Defense Bills in Progress…

Screen Shot 2016-05-27 at 9.40.46 AM

Senate Defense Appropriations

The Senate Defense Appropriations Subcommittee approved a bill for FY17 on Tuesday, and the Senate Appropriations Committee approved the bill Thursday; summary found here. The bill adheres to the original budget agreement from last year, allocating $515.9 billion to base defense budget funding and $58.6 billion to Overseas Contingency Operations.

The main difference between the SAC Defense bill and the HAC Defense bill is that the Senate has chosen not to follow the House maneuver to shift OCO funds to prompt an overall increase in the defense budget next year. The Senate bill cuts approximately $15 billion in spending and will redistribute those funds towards operation readiness, maintenance accounts, shipbuilding, and aircraft procurement. Highlights of the Senate Defense appropriation:

Shipbuilding $2.1 billion increase, 3 additional ships, $1 billion for first Polar Icebreaker Recapitalization Project

Aircraft Procurement $2.5 billion increase (not originally requested)

    $979 million for twelve F-18 aircraft (Navy)

    $507 million for two F-35 carrier variant; and two F-35 vertical take-off, Joint Strike Fighters (Marine Corps)

    $367 million for fifteen Blackhawk helicopters (Army National Guard)

    $187 million for twenty-eight Lakota helicopters (Army)

    $160 million for two C-130J aircraft (Air Force)

    $150 million for two MV-22 helicopters (Marine Corps)

    $103 million for Compass Call aircraft replacement (Air Force)

   $75 million for UH-1N replacement helicopters (Air Force)

Readiness $900 million for National Guard and Reserves equipment account

Space Rockets/Engines — $396.6 million to space launch vehicles or rocket engines, launch procurements will be available to all certified launch providers regardless of where the rocket engine was manufactured (addressing the controversy over US use of Russian RD-180 engines)

OCO enables funding for ongoing threats, operations against ISIL, and the European Reassurance Initiative

Senate Majority Leader Mitch McConnell has stated that he would like to take up the appropriations bill after the NDAA. Expect further action on both of these bills when the Senate reconvenes in June.

Senate NDAA

The Senate voted to move forward with debate on the FY17 National Defense Authorization Act on Wednesday, but Democrats pushed against voting on a final version before the recess. Senate Minority Leader Harry Reid contested that the closed SASC markup session did not give lawmakers enough time to read and fully consider the bill.

Additionally, there are now many amendments to the bill that must be considered. At the forefront is SASC Chairman John McCain’s proposal to increase the Pentagon’s budget by $17 billion to provide the military with some of its “wish list” items such as 14 F/A-18 Super Hornets and 11 F-35 fighters, 36 UH-60 Blackhawk and 17 LUH-72 Lakota helicopters. McCain’s amendment would also raise military personnel salary by 2.1%, all in an effort to fight back against “short-sighted cuts,” said McCain, to the defense budget.

Other amendments, totaling over 170, address the Iran missile program, Guantanamo, the Afghan Special Immigrant Visa program, and more. Expect more amendments and more debate on the NDAA when the Senate returns after Memorial Day.

HLS Appropriations

Thursday, the Senate Appropriations Committee approved a $48.07 discretionary spending level for the Department of Homeland Security. The budget includes $6.7 billion for FEMA Disaster Relief Programs and $163 million for Cost Guard Overseas Contingency funding.

The $48.07 level is $245 million above the FY16 spending level and $740 million above the President’s budget request.

Budget Reform

Committee Chairs of the House and Senate Budget Committees are raising the issue of broad budget reform in Congress. HBC Chairman Tom Price is hoping to leverage support from the conservative wing of the Republican party to support passing a budget, in exchange for some rules changes. Efforts in the House are unlikely to gain Democratic support, but chances for SBC Chairman Mike Enzi are slightly better in the Senate. The proposals currently being made would bring significant changes the how the Congressional budget deals with mandatory spending, regulatory costs, etc., but these types of reforms have a long way to go before they gain bipartisan support.

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