This Week on the Hill
The House is in this week, while the Senate returns October 16.
The House convenes today and will consider seven bills under suspension of the rules, most related to the naming of post office facilities. On Wednesday the chamber will consider 10 bills under suspension of the rules, including S. 920, which creates a National Clinical Care Commission to recommend improvements to federal programs for diseases such as diabetes. For Thursday and the balance of the week, the chamber will consider legislation related to disaster supplemental appropriations while other legislative items are possible. Several committees scheduled hearings this week: the Energy and Commerce Committee will hold a hearing Wednesday on the opioid crisis; the Financial Services Committee will hold a hearing Thursday on the future of housing; and the Transportation and Infrastructure Committee will hold a hearing Wednesday on highways and transit stakeholders’ perspectives on infrastructure.
Fiscal Year 2018 Budget Update
Both chambers took action on the fiscal year 2018 budget resolution last week, the first step in advancing tax policy changes. The House voted 219-206 on Thursday to advance their version of the budget resolution (H Con Res 71); the measure calls for a deficit-neutral tax bill and includes instructions to 11 House committees for reducing mandatory spending by $203 billion over the next ten years. Also on Thursday, the Senate Budget Committee voted 12-11 on a party-line vote to advance their resolution to the Senate floor. The resolution aims to reduce spending by $5.1 trillion but does not include details on how the reductions will be met; it also authorizes a $1.5 trillion increase in debt over 10 years to make room for tax cuts while calling for $1 billion in deficit reduction. Due to the differences between the chambers, a conference committee will be required to negotiate a final package before work on tax policy changes can begin.
House and Senate Committees Each Pass Versions of a CHIP Reauthorization Bill
Chairman Orrin Hatch (R-UT) and Ranking Member Ron Wyden (D-OR) introduced the Keeping Kids' Insurance Dependable and Secure (KIDS) Act (S. 1827) on September 18, 2017, which would extend the Children's Health Insurance Program (CHIP) for five years. The proposal would retain the 23-percentage point enhanced matching rate through FY 2019 and then decrease the enhanced match to 11.5 percent in FY 2020 and return to pre-Affordable Care Act rates by FY 2021. The Senate Finance Committee had a markup on this bill on October 4 and approved the bipartisan measure by voice vote. The House Energy and Commerce Committee also had a markup October 4 on a bill that would extend CHIP funding levels and call for matching rates that mirror the Senate’s bill. The House bill would also eliminate cuts to Medicaid Disproportionate Share Hospital (DSH) payments for FY 2018 but would extend the cuts for two years through FY 2027. However, the House bill included funding offsets opposed by Democrats on the committee, leading to a vote of 28-23 for approval. The Kaiser Family Foundation released a fact sheet comparing key provisions in the Senate and House CHIP bills. During the House markup, the committee also passed H.R. 3922, which would extend funding for community health centers and other recently expired public health programs.
FirstNet Delivers Official Notice of State Plans to Governors
On September 29 the First Responder Network Authority (FirstNet) delivered official notice of State Plans to governors. Governors will have 90 days, or until December 28, to decide whether to accept the FirstNet/AT&T plan for deploying the nationwide public safety broadband network or to initiate the process to have the state take on the responsibility for deploying its own Radio Access Network (RAN) that must be interoperable with the FirstNet network. According to the release, if the state does not take any action on its updated State Plan by December 28, the state will automatically opt in to the FirstNet network. At this time, 25 states and territories have chosen to opt in to the FirstNet/AT&T plan for deploying the network.
White House Releases $29 Billion Disaster Aid Request
Last week Office of Management and Budget Director Mick Mulvaney sent a letter to Congress requesting $29 billion in additional disaster relief funding for territories and states affected by the recent hurricanes and wildfires. The request includes $12.77 billion for the Federal Emergency Management Agency’s Disaster Relief Fund, $16 billion in debt relief for the National Flood Insurance Program, and $576.5 million to combat wildfires. The request also includes a series of proposed legislative changes to the National Flood Insurance Program. The House is scheduled to consider the disaster spending request this week. This is the second disaster relief request, after $15.25 billion for disaster funding related to Hurricane Harvey was included in the fiscal year 2018 continuing resolution (H.R. 601).
Senate Committee Passes Self-Driving Vehicle Bill
On Wednesday the Senate Committee on Commerce, Science and Transportation approved by voice vote S. 1885, the American Vision for Safer Transportation through Advancement of Revolutionary Technologies (AV START) Act, which advances efforts to regulate self-driving vehicles. During the vote, an amendment from Senator Bill Nelson (D-FL) was approved that includes new language to establish a balance between federal and state laws affecting self-driving vehicles, attempting to address concerns about state preemption language included in the original bill. The bill now advances to the Senate floor for consideration.
Senators Introduce Bipartisan Criminal Justice Reform Measure
Last week a bipartisan group of senators reintroduced the Sentencing Reform and Corrections Act of 2017, which aims to recalibrate federal prison sentences for nonviolent drug offenders, target violent and career criminals, and save taxpayer dollars. The measure reduces certain mandatory minimum sentences and provides judges with greater discretion when determining appropriate sentences. The bill also authorizes $14 million for a two-year commission to comprehensively review the criminal justice system and make recommendations to the president and Congress. A summary of the bill can be found here and the bill text can be found here.
Houses Passes HQLA Bill
Last Tuesday the House voted by voice vote to advance H.R. 1624, the Municipal Finance Support Act of 2017. The bill, sponsored by Rep. Luke Messer (R-IN) and co-sponsored by Carol Maloney (D-NY), designates certain municipal securities that are liquid, readily marketable, and investment grade as being high-quality liquid assets (HQLAs) for the purposes of the Liquidity Coverage Ratio (LCR). Issued in September 2014, the LCR final rule requires large banks to hold certain high-quality liquid assets sufficient to meet short-term obligations. Currently, the rule excludes municipal bonds as HQLAs. Companion legislation, S. 828, has been introduced in the Senate.
CFPB Introduces Payday Lending Final Rule
Last week the Consumer Financial Protection Bureau (CFPB) released a final rule that would regulate certain short-term lenders by requiring lenders to determine upfront whether people can afford to repay their loans. These protections cover loans that require consumers to repay all or most of the debt at once, including payday loans, auto title loans, deposit advance products, and longer-term loans with balloon payments. Under the new rule, lenders must conduct a “full-payment test” to determine upfront that borrowers can afford to repay their loans without re-borrowing. The rule also includes a “debit attempt cutoff” for any short-term loan, balloon-payment loan, or longer-term loan with an annual percentage rate higher than 36 percent that includes authorization for the lender to access the borrower’s checking or prepaid account. A fact sheet on the rule can be found here. The rule is generally effective 21 months after publication in the Federal Register.
$342 Million in Home Visiting Grants Awarded
The Health Resources and Services Administration (HRSA) recently announced $342 million in funding to 55 states, territories, and nonprofit organizations through the Maternal, Infant, and Early Childhood Home Visiting Program (MIECHV Program). These funds allow awardees to continue to provide voluntary, evidence-based home visiting services to women during pregnancy, and to parents with young children up to kindergarten. According to the release, the program serves almost 42 percent of U.S. counties with high rates of low birth weight infants, teen births, families living in poverty or infant mortality. A full list of awardees can be found here.
Federal Government Reports $668 Billion Budget Deficit for Fiscal Year 2017
According to a new report from the Congressional Budget Office (CBO), the federal government ran a budget deficit of $668 billion in fiscal year 2017 - $82 billion greater than the shortfall recorded in fiscal year 2016. The 2017 deficit equaled an estimated 3.5 percent of gross domestic product (GDP), up from 3.2 percent in 2016. Fiscal year 2017 was the second consecutive year in which the deficit increased as a percentage of GDP. Revenues were 1 percent higher and outlays were about 3 percent higher in 2017 compared to the previous fiscal year. However, a deficit of $668 billion would be about $25 billion smaller than the shortfall that CBO projected in its June 2017 report, largely because outlays were less than CBO anticipated.
Recently Released Reports
Projections of Education Statistics to 2025
National Center for Education Statistics
Juvenile Commitment Rate Falls by Half Nationally in 10 Years
Pew Charitable Trusts
2017 State CIO Survey
National Association of State Chief Information Officers
Prepping for the 2018 Legislative Session: Selected Research for State Budget Analysts
Urban Institute
Federal Action Needed to Address Neonatal Abstinence Syndrome
U.S. Government Accountability Office
Economic News
Economy Loses 33,000 Jobs in September
New data released last week by the U.S. Bureau of Labor Statistics showed that total nonfarm payroll employment decreased by 33,000 in September and the unemployment rate declined to 4.2 (compared to 4.4 percent the previous month). This is the first time since September 2010 that U.S. nonfarm employers shed jobs. A sharp employment decline in food services and drinking places and below-trend growth in some other industries likely reflected the impact of Hurricanes Harvey and Irma. The data also shows that in September there were 6.8 million unemployed persons, down from 7.1 million in August. The number of long-term unemployed (jobless for 27 weeks or more) was essentially unchanged at 1.7 million, accounting for 25.5 percent of the total unemployed. The labor force participation rate was little changed at 63.1 percent. In September, job gains occurred in health care (23,000), transportation and warehousing (22,000), professional and business services (13,000) and financial activities (10,000). Employment in food services and drinking places dropped sharply in September (105,000). The average hourly earnings for all employees increased by 12 cents to $26.55 in September, following an increase of 3 cents in August. Over the year, average hourly earnings have risen by 2.9 percent.