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Weekly Legislative Update
Week of December 4, 2017
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The House and Senate are in session this week. The House will vote on seven bills under suspension of the rules. For the remainder of the week, the House will vote on a formal motion to go to conference with the Senate to reconcile differences between the House and Senate versions of the Tax Cuts and Jobs Act (H.R. 1); the Concealed Carry Reciprocity Act of 2017 (H.R. 38), which would ease gun owners' ability to carry concealed weapons across state lines; the Community Institution Mortgage Relief Act of 2017 (H.R. 3971), which would allow additional mortgage lenders and servicers to qualify for exemptions from escrow and other requirements; and the Small Business Mergers, Acquisitions, Sales, and Brokerage Simplification Act of 2017 (H.R. 477), which would allow merger and acquisition brokers involved in transferring ownership of small privately owned companies to not have to register with the U.S. Securities and Exchange Commission.
On Tuesday, the Senate will vote on the nomination of Kirstjen Nielsen to be the 6th U.S. Secretary of Homeland Security and will likely vote on other Trump Administration nominees throughout the week. The Senate will also vote on a formal motion to go to conference with the House to reconcile differences between the two chambers' versions of the Tax Cuts and Jobs Act. The House and Senate are currently on track to pass a reconciled version of the tax bill by the end of the month.
The House and Senate this week will also consider a two-week Continuing Resolution (CR), the "
Further Continuing Appropriations Act, 2018" to keep the federal government funded from December 9-22, 2017, in order to avert a government shutdown beginning Saturday. The two-week CR also releases some money for states running out of funds to run the Children's Health Insurance Program (CHIP) and continues the authorization of the National Flood Insurance Program (NFIP) through Dec. 22. Over the next two weeks, Congressional leaders will attempt to reach a consensus on lifting non-defense and defense spending limits for the next two years, in addition to a FY 2018 omnibus appropriations bill. If an agreement is not reached by Dec. 22, another CR funding the government through mid-late January 2018 will be necessary to avert a government shutdown right before Christmas.
The end-of the-year spending debate is being complicated by demands from Democrats to reauthorize CHIP and passage of the Dream Act to legalize the residency status of almost 800,000 undocumented immigrants brought to the U.S. as children.
Other hurdles to the spending negotiations include a demand by lawmakers from hurricane-ravaged Florida, Texas and Louisiana for more disaster assistance from the federal government.
On Monday, President Trump headed to Salt Lake City to meet with leaders of the Church of Jesus Christ of Latter-day Saints before giving remarks at the Utah State Capitol unveiling his decision to drastically trim Utah's Bears Ears and Grand Staircase-Escalante National Monuments after deciding the designations under the Antiquities Act of 1906 were overreach. On Tuesday, Trump will host Senate leaders in the Roosevelt Room of the White House, while Vice President Mike Pence travels to Capitol Hill to join the Senate Republican Policy Committee's weekly lunch. On Wednesday, Trump will hold a Cabinet meeting at the White House. On Thursday, Trump and the four top congressional leaders will meet at the White House to discuss a year-end budget deal.
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Senate Passes Tax Cuts and Jobs Act
At 1:50am on Saturday, December 2, the Senate passed, by a vote of
51-49, its version of the Tax Cuts and Jobs Act (
H.R. 1); Sen. Bob Corker (R-TN) was the only Senate Republican to vote with all 48 Senate Democrats against the legislation. The Congressional Budget Office (CBO) has estimated that the bill will cost $1.47 trillion over a decade. The legislation makes
numerous changes at both the individual and business levels and
according to the nonpartisan Tax Policy Center, the bill would increase GDP modestly until 2025, and by even less after many of its individual tax cuts expire in that year, and the bill would barely change the size of the economy in 2027 or in 2037. As a result, the tax bill would generate roughly the same amount of revenue whether it is measured using traditional budget scoring or taking into account the macroeconomic effects of the bill (dynamic scoring).
The bill would also open up the Arctic National Wildlife Refuge in Alaska to oil and gas drilling and repeals the Affordable Care Act's individual mandate.
The final version of the legislation included a 479-page substitute amendment publicly unveiled by Senate GOP leadership only hours before a final vote took place after robust discussions across the Senate GOP Conference, and because a revenue "trigger" did not comply with reconciliation rules. These changes include:
- Deducting up to $10,000 in property taxes paid to state and local governments (SALT), which reflects the treatment of property taxes in the House-passed bill;
- Increasing the deduction for small business owners' qualified business income from 17.4 percent in the underlying bill to 23 percent;
- Extending 100 percent expensing for qualified business property by four more years, gradually decreasing over time, adding to the five years included in the underlying bill;
- Preserving existing business structure commonly referred as IC-DISC (Interest Charge Domestic International Sales Corporation);
- Eliminating an ACA restriction on the deductibility of medical expenses, which will allow medical expenses to be deducted if they exceed 7.5 percent of a taxpayers' adjusted gross income, rather than the 10 percent threshold under current law; and
- Maintaining existing contribution limits and rules for employees of tax-exempt and governmental organizations.
The manager's package also incorporated the policies from 31 additional GOP amendments that were filed to the bill. Over the course of three days, the Senate considered a total of 18 amendments and motions to the tax bill, rejecting 16 and approving the following two amendments: Sen. Ted Cruz's (R-TX) amendment expanding 529 College Savings Plans to include K-12 elementary and secondary school tuition for public, private, and religious schools,
including homeschool
students, which passed by a vote of 51-50 (with Vice President Mike Pence voting in the affirmative); and Sen. Jeff Merkley's (D-OR) amendment stripping out a special interest provision that would have provided an exclusive tax exemption to Hillsdale College, a private college in Michigan heavily funded by the DeVos family, which passed by a vote of 52-48.
Following passage of the Senate's tax bill, the House and Senate this week will form a Conference Committee to reconcile the changes between the two chambers' bills. They will create a unified bill that will need to pass the House and Senate again before it goes to the President's desk. Speaker Paul Ryan (R-WI) and Senate Majority Leader Mitch McConnell (R-KY) are expected to select conferees this week. Going into conference, the Senate's language has the advantage, as the final Conference Report will have to conform to the Senate's complex budget rules in order to pass the bill with 51 votes; the House language did not even come close. Differences between the House and Senate tax bills can be viewed here. Read more...
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Senate Confirms Two Federal Judgeships and Passes Nine Native American-related Bills
Last week, the Senate confirmed the following two nominees by recorded vote:
- Dabney Freidrich to be U.S. District Judge for the District of Columbia, by a vote of 97-3; and
- Gregory Katsas to be U.S. Circuit Judge for the District of Columbia, by a vote of 50-48.
The Senate also passed nine Native American-related bills on Nov. 29 by Unanimous Consent:
- S. 254 - Esther Martinez Native American Languages Preservation Act;
- S. 302 - John P. Smith Act;
- S. 245 - Indian Tribal Energy Development and Self-Determination Act Amendments of 2017 ;
- S. 343 - Repealing Existing Substandard Provisions Encouraging Conciliation with Tribes (RESPECT) Act;
- S. 669 - Columbia River In-Lieu and Treaty Fishing Access Sites Improvement Act;
- S. 772 - AMBER Alert in Indian Country Act of 2017;
- S. 825 - Southeast Alaska Regional Health Consortium Land Transfer Act of 2017;
- S. 1285 - Oregon Tribal Economic Development Act; and
- H.R. 228 - Indian Employment, Training and Related Services Consolidation Act of 2017
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House Passes Brownfields Reauthorization Bill
On November 30, the House passed, by a vote of 409-8, the Brownfields Enhancement, Economic Redevelopment, and Reauthorization Act of 2017 (H.R. 3017), which reauthorizes the U.S. Environmental Protection Agency's (EPA) Brownfields program at $250 million annually through FY 2022. The Brownfields programs funds the development of abandoned, closed, or under-utilized industrial or commercial facilities that are contaminated. Redeveloped or revitalizing properties that may be contaminated are often more costly and have a greater liability associated with them so they often go undeveloped. Leaving these properties vacant and unused negatively impacts real estate values and slows local economic development. Read more...
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House Passes Preserving Access to Manufactured Housing Act
On December 1, the House passed, by a vote of
256-163, the Preserving Access to Manufactured Housing Act of 2017 (
H.R. 1699), which
would expand e
xemptions from federal lending rules for buyers and sellers of manufactured homes. The Dodd-Frank Act modified the Home Ownership and Equity Protection Act (HOEPA), classifying more loans related to manufactured housing as "high-cost mortgages" in an effort to strengthen the consumer protections available to borrowers - as many borrowers purchasing manufactured homes are among the lowest income and economically vulnerable consumers.
H.R. 1699 would modify the definition of "high-cost mortgage", raising the Average Prime Offer Rate (APOR) interest rates prescribed by HOEPA, from 6.5% to 10% for loans between $50,000 and $75,000 and from 8.5% to 10% for loans under $50,000. Further, it would amend the Truth in Lending Act, changing the definition of "loan originator" such that rules established by the Consumer Financial Protection Bureau (CFPB) for marketing and documenting consumer financial transactions do not apply to manufactured housing salespeople who offer credit to borrowers. Read more...
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House Passes Law Enforcement Mental Health and Wellness Act
On November 28, the House passed, by voice vote, the Law Enforcement Mental Health and Wellness Act of 2017 (H.R. 2228), which would help agencies create and improve mental health services for law enforcement officers. The bill would direct the Departments of Justice, Defense, and Veterans Affairs to develop resources to equip local law enforcement agencies to address mental health challenges faced by officers. The bill would also make grants available to initiate peer mentoring pilot programs, develop training for mental health providers specific to law enforcement mental health needs, and support law enforcement officers by studying the effectiveness of crisis hotlines and annual mental health checks. Read more...
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Trump Send 21 Nominees to Senate for Consideration
Last week, President Trump formally sent 21 nominations to the Senate for consideration:
- Marvin Goodfriend to be a Member of the Board of Governors of the Federal Reserve System for a term of fourteen years from February 1, 2016;
- Joseph Macmanus to be U.S. Ambassador to Colombia;
- Phyllis Bayer to be an Assistant Secretary of the Navy for Installations, Energy, and the Environment;
- Erik Bethel to be U.S. Alternate Executive Director of the International Bank for Reconstruction and Development for a term of two years;
- Jeffrey DeWit to be Chief Financial Officer, National Aeronautics and Space Administration;
- David Fischer to be U.S. Ambassador to Morocco;
- Tadd Johnson to be a Member of the Board of Trustees of the Morris K. Udall and Stewart L. Udall Foundation for a term expiring October 6, 2022;
- Lisa Johnson-Billy to be a Member of the Board of Trustees of the Morris K. Udall and Stewart L. Udall Foundation for a term expiring August 25, 2024;
- Mark Schneider to be Director of the Institute of Education Science, Department of Education for a term of six years;
- Judy Shelton to be U.S. Director of the European Bank for Reconstruction and Development;
- Barbara Stewart to be Chief Executive Officer of the Corporation for National and Community Service;
- James Williams to be Chief Financial Officer, Department of Labor;
- Thomas Workman to be a Member of the Financial Stability Oversight Council for a term of six years;
- Matthew Harris to be U.S. Marshal for the District of Utah for the term of four years;
- Ted Kamatchus to be U.S. Marshal for the Southern District of Iowa for the term of four years;
- Joseph Kelly to be U.S. Attorney for the District of Nebraska for the term of four years;
- Joseph McClain to be U.S. Marshal for the Southern District of Indiana for the term of four years;
- Scott Murray to be U.S. Attorney for the District of New Hampshire for the term of four years;
- David Weaver to be U.S. Marshal for the District of Colorado for the term of four years;
- David Weiss to be U.S. Attorney for the District of Delaware for the term of four years; and
- Jelena McWilliams to be Chairperson of the Board of Directors of the Federal Deposit Insurance Corporation for a term of five years.
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