October 23, 2015

The House passed HR 3493, the Securing Our Cities Act; HR 3350, the Know the CBRN Terrorism Threats to Transportation Act; HR 692, the Default Prevention Act; HR 10, the Scholarships for Opportunity and Results Reauthorization Act; and HR 1937, the National Strategic and Critical Minerals Production Act of 2015. The House also passed its budget reconciliation measure, HR 3762, the Restoring Americans’ Healthcare Freedom Reconciliation Act. The Senate failed to invoke cloture on the Stop Sanctuary Policies and Protect Americans Act (S. 2146) by a vote of 54 to 45. The Senate then took up S 754, the Cybersecurity Information Sharing Act and the motion to invoke cloture was agreed to by a roll call vote of 83 to 14. The Senate will resume consideration of the measure when it meets next week. The Senate adopted the following measures by unanimous consent: S 799, a bill to combat the rise of prenatal opioid abuse and neonatal abstinence syndrome; S 1403, the Veterans’ Compensation Cost-of-Living Adjustment Act; HR 208, a bill to require the Small Business Administration to establish a program to make loans to certain businesses, homeowners, and renters affected by Superstorm Sandy; and HR 774, the Illegal, Unreported, and Unregulated Fishing Enforcement Act.

House Leadership Elections

Speaker

After a weekend of “will he or won’t he” run, Rep. Paul Ryan (R-WI) returned to Congress this week and said that he would seek the speakership if certain conditions were met. The conditions included the support from the Freedom Caucus, the Republican Study Committee, and the Tuesday Group, as well as changes to the motion to vacate the chair; no speaker travel on weekends for fundraising; committees, not leadership, lead the policy process; and whatever new rules the conference adopts are applied to all. Ryan did say that he would respect the “Hastert Rule,” which requires a majority of the majority to support legislation in order for it to move to the floor.

It wasn’t clear at first if the House Freedom Caucus would support Ryan. The caucus prefers to vote as a bloc, but under the group’s rules, that can only happen if 80% of its members agree on a leadership candidate. The caucus met Wednesday night and fell a few votes short of the 80%. However, since the Freedom Caucus’ leaders said that a “super majority” would support Ryan’s candidacy, Ryan decided to continue his bid. The Tuesday Group unanimously supported Ryan for Speaker, and the Republican Study Committee voted overwhelmingly to endorse Ryan. Ryan needs 218 GOP votes on the House floor. With only a few holdouts in the House Freedom Caucus, Ryan appears to have the 218 and more.

The GOP conference will meet next Wednesday to vote internally, and the full House will vote on Thursday Oct. 29.

Ways and Means Committee Chair

If Rep. Ryan wins the speakership, he will have to vacate his chairmanship on the Ways and Means Committee. Rep. Kevin Brady (R-TX) is interested in the position, is third in seniority on the committee, chairs the Health subcommittee and is seen as the frontrunner. Brady was the point person on the Medicare “doc fix” issue earlier this year and is a cosponsor of the “Fair Tax” proposal that would eliminate the IRS and replace most federal taxes with a national sales tax. Rep. Pat Tiberi (R-OH) and Rep. Devin Nunes (R-CA) may also be mounting campaigns for Ways and Means. Tiberi chairs the Trade subcommittee and Nunes is chair of the House Permanent Select Committee on Intelligence.

FY16 National Defense Authorization Act Conference Report

On Thursday, President Obama officially vetoed the conference report to the FY16 National Defense Authorization Act (NDAA). This was just the fifth veto of Obama’s presidency. The President vetoed the bill (HR 1735) over the use of the Overseas Contingency Operations (OCO) account for funding an additional $38B as well as provisions preventing the closure of the Guantánamo Bay detention facility. Congressional Republicans are waging an all-out public relations campaign in response to the veto seeking to portray the President is indifferent to the needs of service members. House Republicans have scheduled a Nov. 5 vote to override the veto and are whipping votes now to try to get to the required 2/3 majority. The House originally passed the measure by a vote of 270 to 156 (10 Republicans and 146 Democrats voted against the measure). A vetoed bill can become law if 2/3 of the Members voting in each chamber agree, by recorded vote, a quorum being present, to repass the bill. If there aren’t the votes for an override, the bill will have to be part of any potential overall budget agreement for the current fiscal year.

Cybersecurity

The Senate took up S 754, the Cybersecurity Information Sharing Act (CISA) this week and the motion to invoke cloture was agreed to by a roll call vote of 83 to 14. One possibility that could sidetrack the bill would be if Sen. Tom Cotton’s (R-AR) amendment is adopted. Cotton’s amendment would allow companies to share threat data with the FBI or Secret Service while still getting the same liability protections afforded under CISA that they would by sharing the threat data with the Department of Homeland Security. The Senate will resume consideration of the bill next week and is expected to complete its work on the bill on Tuesday.

FY16 Appropriations

House Appropriations Committee Chairman Hal Rogers (R-KY) has said that his committee needs about a month to write an omnibus bill after any deal is reached on lifting the budget sequestration caps. With that in mind, in order to pass an omnibus before the current continuing resolution (CR) expires on Dec. 11, Rogers would need his new budget caps by Nov. 11.

This week 101 House Republicans wrote a letter to House Speaker John Boehner (R-OH) and Majority Leader Kevin McCarthy (R-CA) in which they said that they would block any FY16 defense appropriation bill that does not raise the defense spending level to the level ($561B) requested by the President and the Pentagon. The letter was spearheaded by Rep. Mike Turner (R-OH), a member of the House Armed Services Committee and Chairman of the Tactical Air and Land Forces subcommittee. The House and Senate FY16 defense appropriations bills do fund defense at the level they are demanding, but the bills rely on the OCO account to provide an additional $38B so that the bills don’t violate the Budget Control Act spending caps.

The members who signed the letter also wrote that they would oppose a full-year CR. And speaking of a CR, White House Principal Deputy Press Secretary Eric Schultz today told reporters that the President would not sign another short-term CR and would oppose any CR that does not fund the government for the remainder of the fiscal year.

Debt Ceiling

The House took up a measure (HR 692, the Default Prevention Act) that would prioritize payments from the U.S. Treasury in the event that the debt ceiling is breached, but they did not consider any legislation to raise the debt limit this week. And it’s not clear yet if they can avoid a default. If all 188 Democrats in the House vote in favor of a clean debt ceiling increase, they still need 30 Republicans to join them. The last time the House passed a debt limit bill only 28 Republicans voted for it, and nine of those “yes” votes have left the House replaced by more conservative members. The House may now look to the Senate to take up an increase first.

The Republican Study Committee had proposed a debt ceiling increase that was tied to new limits on executive branch power, procedural overhauls, and spending reductions. The Terms of Credit Act did not get a whip count of the needed 218 votes, so floor action was postponed.

Terms of Credit Act:

http://rsc.flores.house.gov/files/uploads/The%20Terms%20of%20Credit%20Act_Short%20Outline_10.20.2015_Final.pdf

The current debt limit is $18.1 trillion. Any increase passed by Congress would likely be another debt limit suspension (probably through 2017). Senate Minority Leader Harry Reid (D-V) said that the debt limit and a budget deal would be handled separately, and that the budget deal would come after a debt limit bill is passed. Treasury Secretary Jack Lew estimates that the U.S. will hit its borrowing limit on Nov. 3 after all extraordinary measures are exhausted. The Congressional Budget Office estimated the extraordinary measures would be exhausted “sometime in the first half of November.” If Congress does not raise the debt ceiling before the extraordinary measures are exhausted, the government would be unable to fully pay its obligations. This would lead to delays of payments for government activities, a default on the government’s debt obligations, or both.

In the meantime, the U.S. Treasury on Thursday postponed the 2-year note auction that was scheduled for Tuesday due to debt ceiling constraints. They may also have to postpone the Nov. 2 auction of the 2-year notes. Two other auctions scheduled for next week will continue as scheduled.

Political Updates

The Democratic field for Presidential candidates narrowed greatly this week. With President Obama and Dr. Jill Biden by his side, Vice President Joe Biden announced that he would not seek the Democratic nomination for President. This morning, former Rhode Island Senator Lincoln Chafee dropped out of the race. And earlier this week, former Senator Jim Webb (D-VA) withdrew from the Democratic presidential primary, but indicated that he may pursue the presidency as an Independent depending on “what voters have to say.”

President Obama nominated Lisa Fairfax, a George Washington University law professor, and Hester Peirce, a former Senate Banking Committee aide, to fill the two open seats on the Securities and Exchange Commission (SEC).

Thad Odderstol, Director of Industry Engagement and Resilience at DHS’ Office of Cybersecurity and Communications stepped down last Friday and the agency has not announced you who would replace him.

At the Department of Defense the following appointments were made this week: Karen Hughto to be Deputy General Counsel; Stephen Hedger to be Assistant Secretary of Defense for Legislative Affairs; and Adrienne Schweer to be Special Assistant to the Secretary of Defense for Protocol. Two reassignments were also made this week – Andrew Haeuptle was assigned as the Director of the Management, Policy and Analysis Directorate in the Office of the Deputy Chief Management Officer and Dr. Zachary Mears was assigned as the Deputy Chief of Staff in the Office of the Secretary of Defense.

Deputy Chief Technology Officer Ryan Panchadsaram is stepping down from his position and returning to San Francisco to be with this family. Panchadsaram helped form the U.S. Digital Services and also helped implement President Obama’s open data executive order, which requires the government to make its data freely available, and helped launch a revamped Data.gov.

Outgoing House Speaker John Boehner (R-OH) named announced today that Rep. Marsha Blackburn (R-TN) will chair the special panel created to investigate Planned Parenthood about the sale of fetal tissue. The other Republican members named to the panel are: Joe Pitts (R-PA), Diane Black (R-TN), Larry Bucshon (R-IN), Sean Duffy (R-WI), Andy Harris (R-MD), Vicki Hartzler (R-MO), and Mia Love (R-UT). The panel will reside in the Energy and Commerce Committee.

Next Week

The House will take up a short-term extension of the highway bill, HR 1090, the Retail Investor Protection Act, and legislation relating to the nation’s debt limit. House Transportation and Infrastructure Committee Chairman Bill Shuster was also hopeful that the House would take up HR 3763, the committee’s six-year $330 billion surface transportation authorization bill. The Senate will resume consideration of S 754, the Cybersecurity Information Sharing Act. Senate Majority Leader Mitch McConnell (R-KY) said the Senate will try to wrap its work on this bill by Tuesday.

October 16, 2015 

The House and Senate were in recess this week.

House Leadership Elections and Conference Rules

While Rep. Paul Ryan (R-WI) returned to his district this week to discuss with his family whether or not to run for House Speaker, several other potential candidates emerged. Rep. Bill Flores (R-TX) asked his Republican colleagues for their feedback on his potential pursuit of the position if Ryan opted to not run. Rep. Ryan Zinke (R-MT) and Rep. Pete Sessions (R-TX) are also said to be considering a bid to replace current House Speaker John Boehner (R-OH) if Ryan says no. Other declared candidates include Rep. Jason Chaffetz (R-UT) and Rep. Daniel Webster (R-FL). Ryan, who has already declined the job twice since Boehner’s retirement announcement, may prefer to remain as Chairman of the House Ways and Means Committee where he can continue to pursue his personal dedication to fiscal issues.

And Republican leaders are formally asking GOP conference members if they should change the rules governing the House GOP conference. Conservatives in the House Freedom Caucus had requested an overhaul of the rules that would give rank-and-file members more say in selecting committee chairmen and seats on key committees. Critics of the Freedom Caucus may submit their own rule changes including one that would require GOP members to vote for the conference’s speaker candidate on the House floor. The conference will meet next Wednesday and members were told to submit their proposals by Tuesday night.

FY16 National Defense Authorization Act Conference Report

All indications are that President Obama will veto the conference report to the FY16 National Defense Authorization Act when it reaches his desk. While the House and Senate passed the conference report last week, the veto showdown will have to wait until next week. The bill still has to be enrolled before it can be sent to the President, and that won’t happen until after Congress returns from recess. The enrollment process includes printing the bill on parchment paper.

Debt Ceiling

The Congressional Budget Office (CBO) released a report this week, “Federal Debt and the Statutory Limit,” in which they estimate that the U.S. Treasury Department will run out of cash “sometime in the first half of November” and that “earlier or later dates are possible, depending on the amount and timing of cash flows in the next several weeks.” This new date is earlier than the date CBO last projected at the end of August. The projected date in that analysis was mid-November-early December. And this week Treasury Secretary Jack Lew said that the U.S. would hit its borrowing limit on Nov. 3, two days earlier than he originally forecasted.

The debt limit (debt ceiling) is the maximum amount of debt that Treasury can issue. The amount is set by law and has been increased over the years in order to finance the government’s operations. In March of this year, the debt ceiling was reached, and the Secretary of the Treasury announced a “debt issuance suspension period.” During such a period, existing statutes allow the Treasury to take a number of “extraordinary measures” to borrow additional funds without breaching the debt ceiling.

CBO now estimates that these “extraordinary measures” will be exhausted by the first half of November. CBO revised its estimate of the timing primarily because the Treasury’s cash balance at the beginning of October was smaller than expected, the result of a larger-than-expected deficit and other variations in cash flows.

If Congress does not raise the debt ceiling before the extraordinary measures are exhausted, the government would be unable to fully pay its obligations. This would lead to delays of payments for government activities, a default on the government’s debt obligations, or both.

House Speaker John Boehner wants Congress to vote to lift the debt ceiling before he leaves office. Boehner is reportedly in talks with the Senate and the White House on a budget deal that will include a debt limit increase. If they can’t come to agreement on a budget deal, Boehner intends to move a standalone bill on the debt limit. But this move could be complicated by the standard he set in 2011 that any time Congress raises the debt ceiling, the increase should be accompanied by corresponding spending reductions.

CBO Federal Debt and the Statutory Limit Report:

https://www.cbo.gov/sites/default/files/114th-congress-2015-2016/reports/50888-FederalDebtLimit.pdf

Highway Reauthorization Bill Released in House

The House Transportation and Infrastructure Committee released its six-year $325B highway reauthorization bill today ahead of an expected markup on Oct. 22. The current authorization expires at the end of the month (Oct. 29). The Senate passed a five-year bill before the August recess that included an EXIM Bank reauthorization provision.

The House bill does not include any new ways to pay for programs, but outlines some policy changes from the last reauthorization (MAP-21). The policy changes include consolidating and eliminating offices within the Department of Transportation, streamlining environmental review and permitting processes; and establishing a Nationally Significant Freight and Highway Projects Program.

Senate Environment and Public Works Committee Ranking Member Barbara Boxer (D-CA) sent a letter to House leaders this week saying she was “heartened” by the news of the markup and urged the committee to pass the bill without delay.

Surface Transportation Reauthorization and Reform Act of 2015:

http://transportation.house.gov/uploadedfiles/strra.pdf

Political Updates

Former House Speaker Dennis Hastert reached a plea deal on Thursday in a criminal case involving charges that he paid $3.5M to an unnamed associate in an attempt to cover up a wrongdoing from several years ago when he was a high school gym teacher in Illinois. Hastert entered a guilty plea that will likely include more than a year in prison for violating a federal banking law. The details of his sentence will be available when Hastert formally enters his guilty plea on Oct. 28.

Next Week

The House will take up HR 10, the SOAR Reauthorization Act; HR 692, the Default Prevention Act; and HR 1937, the National Strategic and Critical Minerals Production Act of 2015. The Senate will resume consideration of the motion to proceed to a “sanctuary cities” bill (S 2146) when they return next week. The Senate Intelligence Committee is also pushing for their cybersecurity legislation (S 754) to be considered next week.

October 9, 2015 

The House passed HR3192, the Homebuyers Assistance House; HR 538, the Native American Energy Act; and HR 702, a bill to adapt to changing crude oil market conditions. The Senate passed the conference report to the FY16 National Defense Authorization Act and passed by unanimous consent HR 34, the Tsunami Warning, Education, and Research Act; HR 3116, the Quarterly Financial Report Reauthorization Act; S 32, the Transnational Drug Trafficking Act; HR 623, the DHS Social Media Improvement Act of 2015; and S 2162, a bill establishing a 10-year term for the service of the Librarian of Congress. The Senate also confirmed Mario Cordero to be a Federal Maritime Commissioner, Sarah Mendelson to be Representative of the United States of America on the Economic and Social Council of the United Nations and to be an Alternate Representative of the United States of America to the Sessions of the General Assembly of the United Nations, Stephen Hedger to be the Assistant Secretary for Legislative Affairs at the Department of Defense, and W. Thomas Reeder, Jr. to be Director of the Pension Benefit Guaranty Corporation.

House Leadership Elections

House Majority Leader Kevin McCarthy (R-CA) shocked DC with his announcement Thursday morning that he was no longer seeking the speakership. This prompted House Speaker John Boehner (R-OH) to postpone the elections with no new vote date set. While Rep. Rep. Daniel Webster (R-FL) and Rep. Jason Chaffetz (R-UT) had also declared their candidacies for Speaker, neither has been taken seriously as a frontrunner even though Webster won the endorsement of the House Freedom Caucus. McCarthy’s decision raises several questions for which there are not a lot of answers right now.

Why did McCarthy step aside?

McCarthy said in an interview that he felt that the party needed a Speaker that could get all 247 votes, not just the 218 needed to win. And it was unclear if he could even get the 218. The Freedom Caucus had made impossible demands of McCarthy such as publicly opposing efforts by establishment groups such as the US Chamber of Commerce to run radio and TV ads criticizing conservatives. There was also the gaffe McCarthy made when speaking about the Benghazi Committee that prompted Chaffetz to enter the race.

What happens next?

It isn’t clear yet if Speaker Boehner will remain in his leadership position until a new permanent Speaker is elected or if the Republican Conference will elect an Interim Speaker. Rep. Candice Miller (R-MI) and Rep. John Kline (R-MN) who are both retiring at the end of 2016, are two names being raised as potential interim speakers. And Rep. Greg Walden (R-OR) has expressed an interest in being interim speaker.

Who will be the next Speaker?

The list of contenders remains fluid. While Rep. Paul Ryan (R-WI) immediately put out a statement saying he wasn’t interested in the position after McCarthy’s surprise announcement, a number of Republicans (including Romney, Boehner, McMorris-Rodgers, and McCarthy) are lobbying Ryan to run. Other names being mentioned are Rep. Trey Gowdy (R-SC), Rep. Jim Jordan (R-OH), Rep. Tom Cole (R-OK), Rep. Lynn Westmoreland (R-GA), and Rep. Darrell Issa (R-CA). Gowdy has said he is backing Ryan, and Jordan has said he doesn’t want the position. And Chaffetz and Webster are still continuing their bids.

Several senior House members and Chairmen are saying they have no interest in replacing Boehner such as House Financial Services Committee Chairman Jeb Hensarling (R-TX) who is publicly backing Ryan. And House Armed Services Committee Chairman Mac Thornberry (R-TX) said he is not interested in the position, confirming in a tweet “I’d rather be a vegetarian.”

What impact does this have on budget and debt ceiling negotiations?

Does McCarthy’s withdrawal improve or hurt the chances of a budget deal that would raise the caps for defense and non-defense spending for FY16 and FY17 and raise the debt ceiling? If Speaker Boehner stays on in his position, it could give him more time to negotiate a deal with Senate Majority Leader Mitch McConnell (R-KY) and President Obama. Others think the “chaos” hurts these efforts. But if Boehner leaves before a deal is passed, a full-year continuing resolution becomes the more likely outcome.

What happens to McCarthy?

McCarthy said that he intends to stay in Congress and keep his current job as Majority Leader. But many are speculating that he will either resign or retire.

FY16 Appropriations

The government is currently funded through December 11 under a continuing resolution. Senate Majority Leader Mitch McConnell (R-KY) brought up the FY16 Energy and Water appropriations bill for a cloture vote this week. The motion to invoke cloture failed by a vote of 49 to 47. Three Republicans voted with the Democrats to oppose moving forward on the bill, while Sen. Manchin (D-WV) was the only Democrat to vote yes.

The Ranking Member on the Senate Appropriations committee, Barbara Mikulski (D-MD) called on budget negotiators to provide them with a revised topline spending limit (302(a) allocation) by November 1 so that appropriators can wrap up an omnibus spending bill before the December 11 deadline. On the House side, the Appropriations Committee Ranking Member Nita Lowey (D-NY) said that her drop-dead date for a new 302(a) is November 11.

FY16 National Defense Authorization Act

The Senate passed the conference report to the FY16 National Defense Authorization Act (NDAA) this week by a vote of 70 to 27. The House passed the measure by a vote of 270 to 156 last week, short of the 2/3 majority needed to override President Obama’s threatened veto. The President and Democrats objected to the authorization of $38B in Overseas Contingency Operations (OCO) funding included in the bill that they claim is being used to skirt the budget caps for defense spending.

If the President decides to veto the NDAA conference report, Congress can try to override the veto. There are two types of vetoes – a regular veto and a pocket veto. In this case the President would have to employ a regular veto as a pocket veto requires Congress to adjourn. For a regular veto, the President would return the unsigned legislation to the House within a 10-day period with a message of disapproval or a “veto message.” If the NDAA is vetoed, it will first go to the House since it is a House-originated measure. A vetoed bill can become law if 2/3 of the Members voting in each chamber agree, by recorded vote, a quorum being present, to repass the bill. If the House fails to override the veto, the Senate won’t have to consider it. The House typically considers the question of overriding a presidential veto under the hour rule, with the time customarily controlled and allocated by the chair and ranking Member of the committee with jurisdiction over the bill (in this case the HASC). The Senate usually considers the question of overriding a veto under the terms of a unanimous consent agreement.

Defense Acquisition Report

Undersecretary of Defense for Acquisition, Technology and Logistics Frank Kendall released the annual “Performance of the Defense Acquisition System” report and spoke about it at conference this week. The third annual report found that the Pentagon’s system for buying weapons, vehicles, and services has improved, and the cost growth on major programs is generally “at or better than historical levels.” But there were some outliers that remain a problem, including the Army’s Paladin howitzer and MQ-1 Grey Eagle drone; the Navy’s Littoral Combat ship, upgrades to its H-1 helicopter, and its DDG-1000 destroyer program; and the Air Force’s Global Hawk unmanned aerial vehicle and a pair of its major satellite programs, the Space-Based Infrared System (SBIRS) and the Advanced Extremely High Frequency satellite. The new data also confirmed that first-tier subcontract margins are generally higher than those on prime contracts, which the department wants to further analyze from a policy perspective. And the report presents evidence that DOD has been pursuing less complex systems with about the same or less risk since 2009 raising concerns that the department is not pursuing state-of-the-art enough endangering the US’ military technical superiority. Finally, the report shows a correlation between high acquisition cost growth for programs and tight budgetary environments, which Kendall partly attributed to unrealistic bids.

A copy of the report can be found at:

http://www.acq.osd.mil/fo/docs/Performance-of-Defense-Acquisition-System-2015.pdf

Political Updates

The President nominated Steven Haro to be Assistant Secretary for Legislative and Intergovernmental Affairs at the Department of Commerce, John Kotek to be Assistant Secretary for Nuclear Energy at the Department of Energy, Carolyn Lerner to be Special Counsel in the Office of Special Counsel, Matthew Matthews to be the United States Senior Official for the Asia-Pacific Economic Cooperation Forum at the State Department, Michael Missal to be Inspector General at the Department of Veterans Affairs, Amos Hochstein to be Assistant Secretary for Energy Resources at the Department of State, and Raymond Dolan to be a member of the President’s National Security Telecommunications Advisory Committee.

Michael Amato, communications director for the minority on the House Armed Services Committee (HASC), is leaving the committee on Oct. 15 to become the communications director for the Office of Personnel and Management. Amato has worked for the top Democrat on the Armed Services panel, Rep. Adam Smith (D-WA), for more than seven years in both his personal office and on the committee.

Next Week

The House and Senate are in recess next week. The Senate will resume consideration of the motion to proceed to a “sanctuary cities” bill (S 2146) when they return the following week. The Senate Intelligence Committee is also pushing for their cybersecurity legislation (S 754) to be considered after the recess.

October 2, 2015

Both the House and Senate passed a continuing resolution funding the government through December 11 averting a potential shutdown of the federal government. The House also passed the conference report for the FY16 National Defense Authorization Act (HR 1735), the Cross-Border Rail Security Act of 2015 (HR 2786), the Border Jobs for Veterans Act of 2015 (HR 2835), the Justice for Victims of Iranian Terrorism Act (HR 3457), the Women’s Public Health and Safety Act (HR 3495), and the Department of Veterans Affairs Expiring Authorities Act (S 2082). The Senate passed HR 3614, the Airport and Airway Extension Act of 2015 and HR 1624, the Protecting Affordable Coverage for Employees Act. The Senate also passed by unanimous consent a bill to reauthorize the US Commission on International Religious Freedom (S 2078), a bill reducing an increase in the minimum wage for American Samoa (HR 2617), the Border Jobs for Veterans Act (HR 2835), and a bill to extend and expand the Medicaid emergency psychiatric demonstration project (S 599).

House Leadership Elections

Next Thursday (Oct. 8), House Republicans will elect their new leadership. Rep. Lynn Westmoreland (R-GA) may challenge the customary process by recommending candidates vacate their current leadership posts if they run for another office, and he may have the support of some younger members of Congress. Current GOP rules only state that vacancies trigger elections.

Speaker

House Majority Leader Kevin McCarthy (R-CA) announced this week that he was seeking the speaker’s gavel. McCarthy has two challengers for the leadership position. Rep. Daniel Webster (R-FL), whose district may be eliminated by the 2016 election, and Rep. Jason Chaffetz (R-UT), Chairman of the Oversight and Government Reform Committee. Chaffetz hasn’t officially declared, but is rumored to be preparing to also launch a campaign for House speaker. This comes after Chaffetz called on McCarthy to apologize for his remarks this week that the Benghazi Committee investigation has damaged Hillary Clinton’s poll numbers. McCarthy remains the overwhelming favorite to replace outgoing Speaker John Boehner (R-OH).

The new speaker will be elected through a floor vote in which a simple majority of 218 votes will be required to approve the new leader. That leaves McCarthy room to lose the support of only 29 Republican members. The Freedom Caucus prefers to vote as a bloc, but under the group’s rules, that can happen only if 80% of members agree on a leadership candidate. If the Freedom Caucus throws its weight behind Webster’s candidacy for speaker, McCarthy would have huge problems winning the gavel and it could throw the GOP Conference into turmoil. But if McCarthy can secure the backing of 4/5 of the group, the speakership would be his to lose. If neither candidate reaches that 80% threshold, every member of the conservative group becomes a free agent — and McCarthy will try to pick off individual lawmakers. He would be expected to corral a majority of the group in that scenario.

Majority Leader

Reps. Steve Scalise (R-LA) and Tom Price (R-GA) are running for Majority Leader if McCarthy is elected Speaker. Rep. Cathy McMorris Rodgers (R-WA) took herself out of the running this week. House Financial Services Chairman Jeb Hensarling (R-TX) and House Ways and Means Chairman Paul Ryan (R-WI) have both endorsed Price for Majority Leader. Price fought against raising defense spending in the Republican budget earlier this year. Rep. Marsha Blackburn (R-TN) has thrown her support behind Scalise.

Majority Whip

Reps. Markwayne Mullin (R-OK), Patrick McHenry (R-NC), Pete Sessions (R-TX), and Dennis Ross (R-FL) are all likely candidates for Majority Whip if Rep. Scalise is elected Majority Leader or forced to vacate the position while running for Majority Leader.

FY16 Appropriations/Continuing Resolution (CR)

The House and Senate avoided a federal government shutdown by passing a FY16 continuing resolution (CR) this week. The House passed the CR by a vote of 277 to 151 after the Senate had cleared it by a vote of 78 to 20.

House Speaker John Boehner (R-OH) defied House conservatives who wanted to use the CR to defund Planned Parenthood. All Democrats in the House voted for the CR, but they were joined by only 91 House Republicans. All nay votes in the Senate were from Republican members, including Republican Presidential candidates Sen. Rand Paul (R-KY) and Sen. Ted Cruz (R-TX). Sens. Lindsey Graham (R-SC) and Marco Rubia (R-FL) did not vote. The vote counts indicate the difficulties that lie ahead with passing a long-term omnibus spending measure by the December 11 deadline. President Obama has vowed to veto an omnibus that doesn’t replace sequestration.

The $1.017T in annualized spending CR funds the government through December 11 and includes $74.8B in Overseas Contingency Operations (OCO) funding. In order to stay within the total spending limits set by the Budget Control Act, the 2016 CR contains an across-the-board reduction of 0.2108 percent. In the Senate Budget Committee’s latest “Budget Bulletin,” the committee states that while the CR stays under the BCA spending cap, nondefense spending exceeds its cap and defense spending falls below its cap. So while for the duration of the CR, the nondefense overage will not result in sequestration, an across-the-board reduction would occur if the CR were extended past the end of this session of Congress.

After passing the CR, Senate Majority Leader Mitch McConnell filed cloture on the motion to proceed to the $77.6B FY16 Military Construction/Veterans Affairs appropriations bill. The vote failed 50 to 44 (60 is needed for cloture). Sen. Joe Donnelly (D-IN) was the only Democrat to vote in favor of the motion to invoke cloture on the spending measure.

Major Legislative Issues for Remainder of 2015

What impact will the changes in leadership have on the outstanding legislative issues for 2015, including the prospects for a budget deal to raise the Budget Control Act spending caps as well as the debt ceiling? House Speaker John Boehner’s (R-OH) retirement means that October could either be very tumultuous or very productive. The Speaker, no longer handcuffed by the conservatives in his party, could “clear the decks” for his successor before retiring. He said that he doesn’t intend to “sit around and do nothing for the next 30 days.”

FY16 Appropriations Bills/Omnibus

Boehner and McConnell have begun talks over a budget deal and will spend the next several weeks debating the stringent, across-the-board spending caps imposed in the Budget Control Act of 2011. Failure to reach agreement on lifting these caps will have an impact on the FY16 appropriations negotiations and could mean a federal government shutdown after December 11. The best prospects for an agreement and passage of an omnibus spending bill are with the current Speaker, as any long-term budget deal will be much more difficult for the new leadership team to bargain. House Minority Leader Nancy Pelosi (D-CA) said House Democrats want to raise the spending caps by $74B, split evenly between defense and nondefense spending.

Debt Ceiling

Treasury Secretary Jack Lew sent a letter to Congress this week in which he said that the US will hit its borrowing limit by November 5. This deadline is sooner than originally estimated as “Tax receipts were lower than we previously projected, and the trust fund investments were higher than projected- resulting in a net decrease of resources available to the United States government.” This new deadline gives Congress just a month to raise the debt ceiling to avoid a default. The debt limit increase could be tied to budget negotiations or a highway reauthorization measure. Speaker Boehner will likely have to negotiate this issue before he retires. He will face opposition from his own party for a clean debt limit hike, so he may have to rely on some Democrat votes by crafting a debt ceiling increase acceptable to both parties.

EXIM Bank

The Export-Import Bank charter expired on June 30. House Republicans are looking to revive the bank by forcing a House vote. They have secured enough Republican support to bring an extension of the agency’s charter to the House floor later this month. More than 30 Republicans have signed on to a discharge petition, which would force a vote on the reauthorization. A number of Democrats are expected to sign the petition.

Surface Transportation Reauthorization

The current highway bill authorization expires on October 29. The Senate passed a long-term (5 year) reauthorization before the August recess that included an EXIM Bank reauthorization provision. The House is working on a 6-year reauthorization that they hope to get out of committee in early October, but those plans may be falling apart as House Ways and Means Chairman Paul Ryan (R-WI) told House Transportation and Infrastructure Chairman Bill Shuster (R-PA) not to count on international tax revenue for their offset. Ryan and Sen. Chuck Schumer (D-NY) remain at odds on the appropriate level of highway spending.

Tax Extenders

A number of tax provisions that expired at the end of 2014 will be unavailable to taxpayers when they file their 2015 taxes if they are not retroactively extended before the end of December. The tax provisions include credits for research and development, deductions for teachers’ out of pocket expenses, and credits that assist the US wind energy industry. In August, the Senate Finance Committee reported out S 1946, a bill that extends these tax provisions through 2016, and the House has passed several bills making some of the tax provisions permanent.

FY16 National Defense Authorization Act

The House and Senate Armed Services Committee reached agreement on a conference report to the FY16 National Defense Authorization Act (NDAA) this week. The House passed the measure by a vote of 270 to 156, with mostly Democratic opposition to the bill. The vote was 20 ayes short of the votes needed to override President Obama’s threatened veto. The President and Democrats objected to the authorization of $38B in OCO funding that is being used to skirt the budget caps for defense spending. Senate Majority Leader Mitch McConnell (R-KY) filed for cloture on the conference report this week, lining up a cloture vote for Tuesday. Sixty votes are needed to move forward and it is unclear at this time how Senate Democrats will vote on the procedural motion and final passage.

FY16 NDAA Conference Report:

http://docs.house.gov/billsthisweek/20150928/CRPT-114hrpt270.pdf

FY16 NDAA Conference Report Summary:

https://rules.house.gov/sites/republicans.rules.house.gov/files/114/PDF/114-CRHR1735-SxS.pdf

House Homeland Security Committee Markup

The House Homeland Security Committee met this week and marked up several bills including one (HR 3572) that would make structural changes to the Department of Homeland Security. The bill, the DHS Headquarters Reform and Improvement Act of 2015, would amend the 2002 law that created DHS to update and streamline the department and encourage better policy, planning, management, and performance. The other bills marked up in the committee were:

• HR 3102, the Airport Access Control Security Improvement Act of 2015
• HR 3144, the Partners for Aviation Security Act
• HR 3350, the Know the CBRN Terrorism Threats to Transportation Act
• HR 3361, the DHS Insider Threat and Mitigation Act
• HR 3490, the Strengthening State and Local Cyber Crime Fighting Act
• HR 3493, the Securing the Cities Act of 2015
• HR 3503, the DHS Support to Fusion Centers Act of 2015
• HR 3505, the DHS Clearance Management and Administration Act
• HR 3510, the DHS Cybersecurity Strategy Act of 2015
• HR 3572, the DHS Headquarters Reform and Improvement Act
• HR 3578, the DHS Science and Technology Reform and Improvements Act of 2015
• HR 3583, the Promoting Resilience and Efficiency in Preparing for Attacks and Responding to Emergencies Act
• HR 3584, the TSA Reform and Improvement Act of 2015
• HR 3586, the Border and Maritime Coordination Improvement Act
• HR 3598, the Fusion Center Enhancement Act of 2015

Political Updates

Secretary of Education Arne Duncan is stepping down in December and will rejoin his family in Chicago. John King, currently the Acting Deputy Secretary, will take over for Duncan in an acting capacity but will not be formally nominated for the position. After Duncan’s resignation, Agriculture Secretary Tom Vilsack will be the only original member of the Obama Cabinet still serving.

CNN announced its debate criteria for its Democratic candidates debate in Las Vegas on October 13 at 9 pm. All five declared candidates – Hillary Clinton, Bernie Sanders, Martin O’Malley, Jim Webb, and Lincoln Chaffee – have been invited to participate in the debate. Vice President Joe Biden could participate in the debate if he declares as the qualifications for participation are achieving an average of 1% in three polls recognized by CNN released between August 1 and October 10. But sources say Biden is unlikely to participate. CNN anchor Anderson Cooper is moderating the debate, while CNN Chief Political Correspondent Dana Bash, CNN en Español Anchor Juan Carlos and CNN anchor Don Lemon will present questions to the candidates.

The next Republican candidates debate hosted by CNBC on October 28 will feature an undercard stage at 6 PM before the main event at 8 PM for those candidates polling at a 1% average in the five weeks before the debate. The main event will include candidates polling at a 3% or above average (and anything 2.5% and above will be rounded up to 3%). The polls being used for the averages are from NBC, ABC, CBS, Fox, CNN and Bloomberg released between Sept. 17 and Oct. 21. The debate will be moderated by CNBC anchors John Harwood, Carl Quintanilla, and Becky Quick. The most recent polling averages from the recognized polls since Sept. 17 show that Gov. Bobby Jindal, former Sen. Rick Santorum, former Gov. George Pataki, Sen. Lindsey Graham, and former Gov. Jim Gilmore have not cleared a 1 percent average. According to the most recent polling averages, the main debate stage would feature Donald Trump, Ben Carson, Carly Fiorina, Marco Rubio, Jeb Bush, Ted Cruz, John Kasich, Chris Christie, Mike Huckabee, and Rand Paul.

Ari Schwartz, Senior Director for Cybersecurity on the United States National Security Council Staff at the White House, stepped down from his position on Wednesday. Schwartz did not indicate where he might work next.

Representative Ed Whitfield (R-KY) announced Tuesday that he’s retiring at the end of 2016. Whitfield was considered a possible contender for replacing House Energy and Commerce Committee Chairman Fred Upton (R-MI) who is term-limited by GOP rules. The other possible successors are Reps. Greg Walden (R-OR) and John Shimkus (R-IL).

Evelyn Farkas, Deputy Assistant Secretary of Defense for Russia, Ukraine and Eurasia, is leaving her post at the end of next month after five years with the Defense Department.

NASA named Renee Wynn as its new Chief Information Officer after serving for three months as the agency’s Deputy CIO. Wynn replaces Larry Sweet who served as CIO for about two years. Wynn joined NASA in July after leaving her post as the Acting Assistant Administrator in the Office of Environmental Information at the Environmental Protection Agency.

Charles Perkins has been assigned as the Principal Deputy Director for Emerging Capability and Prototyping in the Office of the Under Secretary of Defense, Acquisition, Technology and Logistics at the Department of Defense. Dr. Perkins previously served as the Deputy Director of Special Projects.

Martha Dorris, GSA’s director of the Office of Strategic Programs within the Office of Integrated Technology Services, plans to leave government at the end of October.

Air Force Lt. Gen. Anthony Rock was appointed to the rank of lieutenant general and assigned as the Inspector General of the Air Force. Rock is currently serving as Chief in the Office of the Defense Representative-Pakistan at the US Central Command in Pakistan.

Next Week

The House will take up HR3192, the Homebuyers Assistance House; HR 538, the Native American Energy Act; and HR 702, a bill to adapt to changing crude oil market conditions. The Senate will vote on the conference report to the FY16 National Defense Authorization Act (HR 1735).

September 25, 2015

The House passed the Responsibly And Professionally Invigorating Development Act of 2015 (RAPID Act), which would modify the environmental review process for federally-funded projects. The Senate could not get the 60 votes necessary for cloture on HR 36, the Pain-Capable Unborn Child Protection Act (vote 54 to 42); HR 2685, the FY16 Department of Defense Appropriations Act (vote 54 to 42); and HJ Res 61, a continuing resolution that included language to defund Planned Parenthood (vote 47 to 52). The Senate passed by unanimous consent S1109, the Truth in Settlements Act; HR 2051, the Agriculture Reauthorizations Act of 2015; a resolution congratulating Captain Kristen Griest and First Lieutenant Shaye Haver on their graduation from Ranger School; S 1632, a bill requiring a regional strategy to address the threat posed by Boko Haram; S 986, the Albuquerque Indian Land Transfer Act; and S 1170, the Breast Cancer Research Stamp Reauthorization Act. The Senate also confirmed Kathryn Matthew to be Director of the Institute of Museum and Library Services at the National Foundation on the Arts and Humanities.

House Speaker Boehner Announces Resignation

House Speaker John Boehner (R-OH) announced today that he is retiring from Congress effective October 30. Boehner had intended to announce on his birthday (November 17) that he was resigning at the end of the year, but said that it became clear to him that this “prolonged leadership turmoil would do irreparable harm to the institution.” He also stated that he wanted to retire at the end of 2014, but that Rep. Eric Cantor’s primary defeat persuaded him to stay one more year. House Majority Leader Kevin McCarthy (R-CA) is the most likely candidate for the position. While Boehner said that McCarthy would “make a wonderful speaker,” McCarthy has not yet made his intentions known.

Twenty-five Republicans voted against Boehner for Speaker back in January. Several of them are members of the House Freedom Caucus, which is led by Rep. Jim Jordan (R-OH). Jordan said that he would not seek the position. The other candidates for speaker back in January were Reps. Daniel Webster (R-FL) (12 votes), Louie Gohmert (R-TX) (3 votes), and Ted Yoho (R-FL) (2 votes).

FY16 Appropriations/Continuing Resolution (CR)

There are just five more days in fiscal year 2015, and only three legislative days remaining where both the House and Senate are in session before the end of the fiscal year.

The Senate Appropriations Committee introduced a continuing resolution (CR) this week that would fund the federal government through December 11 at an annual rate that conforms to the topline discretionary spending limit established by the Budget Control Act for FY16 ($1.017T). The CR provides Overseas Contingency Operations funding at a rate of $74.758B and includes $700M in emergency funding for wildland fire suppression. The CR also includes extensions of certain expiring authorities, including the Internet Tax Freedom Act, E-Verify, and the Federal Aviation Administration (6 months). And most notably, the CR included a provision prohibiting for one year any funding for Planned Parenthood and redirected the $235M in mandatory savings to increases funding for community health centers.

Senate Majority Leader Mitch McConnell (R-KY) brought up the CR for a cloture vote on Thursday and it failed by a vote of 47 to 52. The strong vote against cloture was intended to send a message to the House Freedom Caucus which has been insisting on including the Planned Parenthood language in any spending bill. Republican senators voting against the CR included Kelly Ayotte (R-NH), Susan Collins (R-ME), Tom Cotton (R-AR), Dean Heller (R-NV), Mark Kirk (R-IL), Lisa Murkowski (R-AK), Rand Paul (R-KY), and Ben Sasse (R-NE).

McConnell then began the process for the Senate to pass a “clean” CR that does not include the Planned Parenthood language. The cloture vote on the clean CR will occur on Monday at 5:30 pm. However, Sen. Ted Cruz (R-TX) has vowed to use all procedural tools to stop any CR that includes funding for Planned Parenthood.

Senate Continuing Resolution:

http://www.appropriations.senate.gov/sites/default/files/092215-FY16-CR%20Bill.pdf

One-Pager:

http://www.appropriations.senate.gov/sites/default/files/092215-FY16-CR%20One-Pager.pdf

Section-by-Section Analysis:

http://www.appropriations.senate.gov/sites/default/files/092215-FY16-CR%20Section-By-Section.pdf

On the House side, House Speaker Boehner’s decision to resign may have decreased the odds of a government shutdown. The House is expected to vote on the clean Senate-passed CR next week.

2016 Presidential Election Debate Schedule

The Commission on Presidential Debates announced the sites and dates for the 2016 general election debates this week. There will be three presidential and one vice presidential debates during the 2016 general election. The dates and sites are:

First presidential debate:

Monday, September 26, 2016

Wright State University, Dayton, OH

Vice presidential debate:

Tuesday, October 4, 2016

Longwood University, Farmville, VA

Second presidential debate:

Sunday, October 9, 2016

Washington University in St. Louis, St. Louis, MO

Third presidential debate:

Wednesday, October 19, 2016

University of Nevada, Las Vegas, Las Vegas, NV

Hofstra University in Hempstead, NY will serve as the backup site.

Political Updates

Newly elected Rep. Darin LaHood (R-IL) was appointed to the House Natural Resources and Science, Space, and Technology Committees. Rep. Dan Newhouse (R-WA) resigned from the House Science, Space, and Technology Committee.

Outgoing Chairman of the Joint Chiefs of Staff Army Gen. Martin Dempsey officially retired this week after more than 41 years of service. Marine Gen. Joseph Dunford Jr. took over as the 19th Chairman of the Joint Chiefs of Staff. Marine Corps Gen. Robert Neller assumed command of the Marine Corps from Gen. Dunford.

President Obama nominated Eric Fanning to be Secretary of the Army, Ricardo Aguilera to be Assistant Secretary of the Air Force for Financial Management, Janine Davidson to be Under Secretary of the Navy, Lisa Disbrow to be Under Secretary of the Air Force, Shoshana Lew to be Chief Financial Officer at the Department of Transportation, Jennifer O’Connor to be General Counsel at the Department of Defense, and Ambassador Thomas Shannon to be Under Secretary for Political Affairs at the Department of State.

Jodi Daniel, who has served as Director of the Office of Policy in the Office of the National Coordinator for Health Information Technology (ONC) at Department of Health and Human Services (HHS), is leaving her post on October 9 to work for a private law firm. Daniel helped found the office more than a decade ago.

The Federal Communications Commission has appointed Brian Scarpelli, Director of Government Affairs at the Telecommunications Industry Association, as co-chair of the Communications Security, Reliability and Interoperability Council’s Security by Design working group.

Pete Tseronis, Chief Technology Officer for the Department of Energy, is leaving his post at the end of October to join the private sector.

Dr. James Billington announced that he will retire as the 13^th Library of Congress on September 30.

Next Week

The Senate will take up a “clean” continuing resolution funding the federal government through December 11. The House will also consider funding legislation, and may also take up HR 3495, the Women’s Public Health and Safety Act and HR 702, a bill to adapt to changing crude oil market conditions. The House will also take up under suspension of the rules HR 1624, a bill that would amend the 2010 health care law to keep employers with 51 to 100 workers from having to comply with more stringent insurance coverage requirements.