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November 13, 2017 - Washington Report

By Leah Wavrunek posted 11-13-2017 04:00 PM

  

This Week on the Hill

The House and Senate are both in session this week, with action expected in both chambers on tax bills.

The House convenes today and will consider four bills under suspension of the rules related to operations of the federal government. On Tuesday the House will consider H.R. 2810, the National Defense Authorization Act for 2018 and H.R. 2874, the 21st Century Flood Reform Act, which reauthorizes the National Flood Insurance Program for five years. For Wednesday and the balance of the week the chamber will consider a federal evidence-based policymaking bill (H.R. 4174) and the tax bill (H.R.1), which is discussed in greater detail below. Several committees scheduled hearings this week: the Education and the Workforce Committee will hold a hearing Wednesday on policies and priorities of the Department of Labor; the Judiciary Committee will hold a hearing Tuesday on oversight of the Department of Justice; and the Veterans’ Affairs Committee will hold a hearing Friday on veterans’ education and transition to civilian life.

The Senate convenes today and will resume consideration of the nomination of Derek Kan to be undersecretary of the Department of Transportation. Several committees scheduled hearings this week: the Appropriations Committee will hold a hearing Wednesday on VA efforts to prevent opioid over medication; the Energy and Natural Resources Committee will hold a hearing Tuesday on hurricane recovery efforts in Puerto Rico and the U.S. Virgin Islands; and the Commerce, Science and Transportation Committee will hold a hearing Tuesday on technology in agriculture.

 

House Committee Sends Tax Bill to Floor

On Thursday the House Ways and Means Committee voted 24-16 on a party-line vote to approve H.R. 1, the Tax Cuts and Jobs Act. The only amendments adopted by the committee were those authored by the committee’s chair Kevin Brady (R-TX), including an amendment approved Thursday that would create a new pass-through rate for businesses, strike repeal of the adoption credit, increase the one-time tax on overseas earnings, make further changes to corporate excise taxes, and keep a moving expense deduction for military families. A summary of the amendment can be found here. A score issued by the Joint Committee on Taxation showed that the combined changes to the legislation brought the total cost of the bill to $1.437 trillion over the next decade, below the limit of $1.5 trillion set in the budget resolution. The House Rules Committee is scheduled to meet on Wednesday and set the rules for debate on the bill, with a vote by the full House expected on Thursday; no substantive amendments are expected on the floor.

 

Senate Finance Committee Releases Plan, Markup Begins Today

The Senate Finance Committee released its tax plan last Thursday and will begin a markup of the bill today. A blog from the Tax Policy Center identifies differences between the chairman’s mark and the bill passed by the House Ways and Means Committee, and Bloomberg also developed a side-by-side comparison. The Senate plan retains the existing seven tax brackets for individual income taxes, but would cut most of the rates; the Senate version also repeals the deductions for state and local income, sales and property taxes, while the House version retains deductions for up to $10,000 in annual property taxes. The full chairman’s mark (legislative text is not available at this time) can be found here, the revenue score by the Joint Committee on Taxation can be found here, and a summary of policy highlights can be found here

 

Administration Will Support Work Requirements for Medicaid

Last week Centers for Medicare and Medicaid Services (CMS) Administrator Seema Verma spoke to a meeting of the National Association of Medicaid Directors, unveiling new CMS policies that encourage states to propose innovative Medicaid reforms. Included among those reforms, Verma indicated that CMS will “openly consider proposals that promote community engagement and work activities.” According to the Kaiser Family Foundation, at least six states – Arkansas, Indiana, Kentucky, Maine, Utah, and Wisconsin – have pending waiver requests that would require work as a condition of eligibility for some Medicaid beneficiaries. Last month the Medicaid and CHIP Payment and Access Commission (MACPAC) released a report entitled “Work as a Condition of Medicaid Eligibility: Key Take-Aways from TANF.” Also in her remarks, Verma highlighted new policies to streamline and improve Section 1115 demonstrations, state plan amendments and 1915 waiver processes, in addition to the creation of first-ever Medicaid and CHIP scorecards.

 

Bill to Promote Oil and Gas Drilling on Federal Lands Advances in House

Last week the House Committee on Natural Resources voted 19-14 to advance H.R. 4239, the Strengthening the Economy with Critical Untapped Resources to Expand American Energy Act (SECURE Energy Act). The bill makes changes to both offshore and onshore drilling practices. First, the bill as amended increases access to offshore oil, gas and wind resources and establishes revenue sharing for certain Atlantic states and Alaska. Second, the bill allows states with established regulatory programs to seek approval from the Interior Secretary to manage specific oil and gas development responsibilities for federal lands within their borders; states with approved regulatory programs receive the full 50 percent of mineral revenues, eliminating the 2 percent administrative fee charged by the Interior Department. A fact sheet on the bill can be found here and the markup memo can be found here.

 

Administration Changes Drug Classification to Aid Fentanyl Prosecutions

On Thursday the U.S. Department of Justice announced that the Drug Enforcement Administration (DEA) will take action against the increase in overdose deaths linked to synthetic opioids by classifying all fentanyl-related substances as Schedule I controlled substances on an emergency basis. When the DEA’s order takes effect, anyone who possesses, imports, distributes, or manufactures any illicit fentanyl analogue will be subject to criminal prosecution in the same manner as for fentanyl and other controlled substances. Per the release, this action will make it easier for federal prosecutors and agents to prosecute traffickers of all forms of fentanyl-related substances. Currently, illicit chemical manufacturers attempt to evade regulatory controls by creating structural variants of fentanyl that are not directly listed under the Controlled Substances Act, hindering prosecution. The temporary scheduling will go into effect no earlier than 30 days after the DEA publishes its notice of intent in the Federal Register and will last up to two years, with a possibility of a one-year extension. Prescription fentanyl, a legal treatment for pain, will remain a Schedule II substance.

 

FAA Releases Drone Pilot Project Guidance for States

Last week the Federal Aviation Administration (FAA) published its notice of the establishment of the Unmanned Aircraft Systems Integration Pilot Program and request for applications. The pilot program encourages state, local and tribal governments, in partnership with drone operators and other private sector stakeholders, to conduct advanced operations safely and with public support in affected communities. Participants will propose and define these operational concepts and determine how to manage them at the local level under the safety oversight role of the FAA. In order to apply, any interested state must submit a notice of intent to participate by November 28; the FAA will then invite each eligible applicant that submitted this notice to submit an application through the FAA/drone program portal, which will be open for submissions through January 4, 2018. Additional information on the pilot program can be found here.

 

GAO Issues Report on Data Quality under the DATA Act Implementation

The U.S. Government Accountability Office (GAO) released a report on the completeness and accuracy of spending data collected under the Digital Accountability and Transparency Act of 2014 (DATA Act). Broadly, the DATA Act aims to make federal spending data more accessible, searchable, and reliable; it also requires the Office of Management and Budget (OMB) and Treasury Department to establish data standards to enable the reporting and tracking of agency spending. As required by the act, 78 federal agencies submitted data by May 2017; this report is GAO’s first review of the quality of the data collected and made available through Beta.USAspending.gov, a website currently under development by Treasury. GAO identified issues and challenges with the completeness and accuracy of the data submitted, use of data elements, and presentation of the data on the spending website.

 

CMS Releases August Medicaid and CHIP Enrollment Report

The Centers for Medicare & Medicaid Services (CMS) released the August 2017 monthly report on state Medicaid and Children's Health Insurance Program (CHIP) eligibility and enrollment data. These data were reported by state Medicaid and CHIP agencies as part of the Medicaid and CHIP Performance Indicator process. The preliminary data show that total enrollment equaled 73.2 million. Since October 2013, enrollment in both programs increased by more than 28.9 percent, compared with the July-September 2013 baseline. States that expanded Medicaid experienced enrollment gains of more than 37.9 percent, while states that did not expand Medicaid saw increases of 12.1 percent.

 

Recently Released Reports

The State Imperative: Aligning Tuition Policies with Strategies for Affordability

State Higher Education Executive Officers Association

Transparency in State Debt Disclosure

Federal Reserve Bank of Boston

DOT Should Take Actions to Improve the Selection of Freight and Highway Projects

U.S. Government Accountability Office

Factors Associated with Increases in US Health Care Spending, 1996-2013

Journal of the American Medical Association

Age Requirements for Free and Compulsory Education

Education Commission of the States

 

Economic News

 

Job Openings Little Changed at 6.1 Million in September

The number of job openings was little changed at 6.1 million on the last business day of September, according to data recently released by the U.S. Department of Labor (August was also recorded at 6.1 million). Job openings have been at or near record high levels since June, with the job openings rate at 4.0 percent in September. Job openings increased in September for professional and business services (+156,000), other services (+52,000), state and local government education (+36,000) and federal government (+15,000) but decreased in accommodation and food services (-111,000) and information (-28,000). The number of job openings were little changed for total private and for government.  The number of hires was little changed at 5.3 million in September and the hires rate was down slightly to 3.6 percent. The number of separations was little changed at 5.2 million. The 3.2 million quits reported in September were up slightly from 3.1 million in August; many economists closely watch the number of quits as a measure of employee confidence in finding another job. Finally, layoffs and discharges were little changed at 1.7 million. Over the 12 months ending in September, hires totaled 63.9 million and separations totaled 62.1 million, yielding a net employment gain of 1.8 million.