May 30, 2014 

The House passed the FY15 Commerce-Justice-Science appropriations bill as well as the FY15 Intelligence Authorization bill. The Senate was in recess.

FY2015 Appropriations

Homeland Security

The House Appropriations Committee marked up its $39.2 billion FY15 Homeland Security spending bill in subcommittee this week. This is a decrease of $50 million below the FY14 enacted level, but an increase of $887.8 million above the President’s FY14 budget request. The bill includes a total of $7 billion in Federal Emergency Management Agency (FEMA) Disaster funding, which matched the President’s request. Customs and Border Protection (CBP) received $10.8 billion, an increase of $219.6 million above FY14, providing for 21,370 Border Patrol agents and 23,775 CBP officers. CBP funding also included $412.5 million for border security technology, an increase of $61 million above the FY14 level. Immigration and Customs Enforcement (ICE) was funded at $5.5 billion, and the Transportation Security Administration (TSA) at $4.6 billion (a decrease of $300.3 million below FY14). A total of $745.5 million was provided for the National Protection Program Directorate’s cybersecurity operations ($46.7 million below FY14), $8.5 billion for the Coast Guard ($46.6 million below FY14), $1.6 billion for the Secret Service ($51.7 million above FY14), $124.8 million for E-Verify, and $1.1 billion for Science and Technology ($113.6 million below FY14). The bill denies the President’s proposal to increase aviation passenger security fees and CBP user fees, and encourages reform of passenger screening operations supporting TSA’s shift to more risk-based screening. The bill also denies a consolidation of the DHS headquarters for a savings of $73 million.

Defense

The House Appropriations Committee also marked up their $491 billion FY15 Defense spending bill in subcommittee. The bill provides an increase of $4.1 billion above the FY14 enacted level and $200 million above the President’s budget request. The draft bill provides $165 billion for operations and maintenance ($4.8 billion more than the FY14), $63.4 billion for research and development, $91.2 billion for equipment procurement, and $31.6 billion for defense health and military family programs. The bill also provides $789 million to refuel the USS George Washington aircraft carrier, $5.8 billion for 38 F-35 aircraft (four more than requested), $1.6 billion for seven KC-46A tankers, $975 million for 12 EA-18G Growlers aircraft (not included in the President’s FY15 request), and a 1.8% wage increase for service members, exceeding the president’s request of 1%. The bill does not block the retirement of the A-10 attack aircraft, rejects the president’s request to reduce basic housing allowances, prohibits funding for transfers of detainees to the US, and bars the Army from transferring AH-64 Apache attack helicopters from the Army National Guard to the active Army.

In addition, the bill includes $79.4 billion in Overseas Contingency Operations (OCO) funding, the same level requested by the President and included in the FY15 House-passed National Defense Authorization Act. In his commencement address at West Point this week, the President said that he would ask Congress to support a new $5 billion Counterterrorism Partnerships Fund (CTPF) to provide the administration with the “flexibility and resources required to respond to emerging needs as terrorist threats around the world continue to evolve.” The CTPF would be funded from within the $79.4 billion FY15 OCO account if Congress supports the President’s request. But some in Congress were skeptical of the proposal, concerned that the administration was laying groundwork to sustain funding levels for the OCO account after the US withdraws from Afghanistan. The administration announced earlier this week that all US forces would be out of Afghanistan by 2017 and that their FY15 OCO request would be forthcoming soon now that the President has made a decision on troop levels in Afghanistan. White House officials said it would likely cost about $20 billion to keep 9,800 U.S. troops in Afghanistan next year.

Since the House is in recess next week, the full Committee likely will take up the defense bill the week of June 9.

Agriculture

The House Appropriations Committee also approved its $20.88 billion FY15 Agriculture, Rural Development, FDA and Related Agencies spending bill in full committee this week. The bill funds agricultural and food programs and services, including food and medical product safety, animal and plant health programs, rural development and farm services, marketplace oversight, and nutrition programs. Six amendments were adopted during full committee considerations: adding $155 million for the Agricultural Research Service Building and Facilities account; prohibiting funding for inspections of horse slaughter facilities in the US; adding report language to encourage compliance with FDA’s 2012 “Scientific Integrity” policy; prohibiting funds to purchase processed poultry from China for use in school lunch programs; adding report language encouraging the FDA to accept certain types of clear, visible calorie displays on products served through vending machines; and making technical and non-controversial changes to the bill and report. The panel rejected a Democratic bid to remove language from the bill that would require the USDA to provide one-year waivers to school meal operators who can show financial hardship in meeting new school meal nutrition standards.

Commerce-Justice-Science

The $51.2 billion FY15 Commerce-Justice-Science (CJS) bill was passed by the House yesterday by a vote of 321 to 87. The House approved several amendments including ones to increase by $19.5 million funding for the National Instant Criminal Background Check System (NICS); increase funding for the COPS grant program by $110 million; help NIST launch a new cybersecurity framework study; bar the Justice Department from using its funding to prosecute medical marijuana users who are abiding by their state’s law; increase weather research activities by $12 million; and provide an additional $8 million for the Prescription Drug Monitoring Program. Democrats tried unsuccessfully to strip language Republicans added during committee markup that would restrict efforts to require gun dealers on the Southwest border to inform the Justice Department when they sell multiple rifles or shotguns to the same person. The amendment was withdrawn. A full list of the adopted amendments can be found at:

http://appropriations.house.gov/uploadedfiles/05.30.14_fy_2015_cjs_bill_-_floor_adopted_amendments.pdf.

While the administration didn’t issue a veto threat, they released a Statement of Administration Policy this week that raised concerns with the reduction in NTIA funding, cuts for some state and local law enforcement grants, and “objectionable language provisions” on gun control issues. Senate appropriators will consider their CJS bill in subcommittee next Tuesday and full committee on Thursday.

Transportation-HUD

The House is expected to take up their $52 billion FY15 Transportation-HUD (THUD) spending bill on the floor when they return from recess the week of June 9. The bill will be considered under an open rule, giving lawmakers the freedom to offer any relevant amendments. Senate appropriators will consider their THUD bill in subcommittee next Tuesday and full committee on Thursday.

The 302(b) allocations for the House and Senate are as follows:

*in millions

FY2015 Appropriations Bill Status

Tax Extenders

The House Ways and Means Committee met this week to continue their work on tax extender legislation. The committee marked up six separate bills that would extend the IRA charitable rollover, make permanent the charitable deduction for food inventory, make permanent the charitable deduction for property donated for conservation, modify the excise tax on the investment income of private foundations, and make permanent 50 percent bonus depreciation.

Political Updates

After presenting a review from the VA Inspector General to President Obama that showed that misconduct was widespread and systemic throughout the VA health system, Veterans Affairs Secretary Eric Shinseki offered his resignation and the President accepted it. President Obama also announced that Secretary Shinseki had begun the process of firing Phoenix VA hospital senior leaders and cancelling performance bonuses. Deputy Secretary of Veterans Affairs Sloan Gibson will become acting secretary until a permanent replacement is nominated and confirmed. Gibson, a graduate of West Point, was just confirmed as Deputy Secretary in February. Prior to his appointment, Gibson served as President and Chief Executive Officer of the United Services Organizations (USO). The President also announced that Rob Nabors will stay at VA temporarily to assist Gibson with tackling this problem.

Rep. Ralph Hall (R-TX), the oldest-serving member of Congress and one of the last WWII veterans serving in Congress, was defeated in a primary runoff by former US Attorney John Ratcliffe. While Hall won the initial primary in March, he failed to earn the majority of the vote needed to avoid a primary runoff. Hall is the first incumbent to lose in a primary this year ending his 34-year career in Congress. The only other WWII member serving in Congress, Rep. John Dingell (D-MI) is retiring at the end of this Congress.

Next Week

The House is in recess. The Senate will take up Sylvia Mathews Burwell’s nomination to be Health and Human Services secretary.

May 23, 2014

The House passed the FY15 National Defense Authorization Act as well as a bill to end the NSA’s bulk data collection of Americans’ phone metadata. The House also passed legislation that makes it easier for the head of the Veterans Affairs Department to fire and demote poorly performing senior executives, in response to a growing scandal over allegations that VA employees falsified documents related to patient care putting veterans on secret waiting lists. The Senate passed the Water Resources Reform and Development Act conference report in addition to a couple of nominations.

FY2015 Appropriations

House

The House Appropriations Committee marked up its $20.88 billion FY15 Agriculture, Rural Development, FDA and Related Agencies spending bill in subcommittee this week. The bill funds agricultural and food programs and services, including food and medical product safety, animal and plant health programs, rural development and farm services, marketplace oversight, and nutrition programs. While the FY15 discretionary funding level for the bill is the same as the FY14 enacted level, the overall bill (mandatory and discretionary funding) is $1.5 billion below the President’s FY15 request and $3 billion below the FY14 enacted level. The bill provides $2.65 billion for agriculture research programs; $6.6 billion in discretionary funding for the Special Supplemental Nutrition Program for Women, Infants, and Children (WIC); $870.8 million for the Animal and Plant Health Inspection Service; $869 million to help farmers, ranchers, and private forest landowners conserve and protect their land; $1.5 billion for the Farm Service Agency; $2.6 billion for rural development programs; $45 million for the rural business and industry loan program; $1.3 billion for rural water and waste program loans, and $606 million for grants; $24 billion in loan authority for the Single Family Housing guaranteed loan program; $1 billion for food safety and inspection programs; almost $2.6 billion in discretionary funding for the FDA; $218 million for the Commodity Futures Trading Commission; and $1.7 billion for overseas food aid. The bill will be considered in full committee next Thursday.

The House Appropriations Committee also approved its $52 billion FY15 Transportation-Housing and Urban Development bill in full committee on a near-party line vote of 28 to 21. While this was the fourth FY15 spending bill for the full committee to consider this year, it was the first one to require a recorded vote instead of advancing on a voice vote. Democrats offered a number of amendments to reverse proposed funding cuts for Amtrak, the TIGER grant program, and Community Development Block Grants, all of which were either rejected or withdrawn. Rep. Rosa DeLauro (D-CT) also offered an amendment to raise the minimum wage that Chairman Hal Rogers (R-KY) said was an attempt to disrupt the committee’s work. The bill provides $1.2 billion more than what was enacted in FY14, but $7.8 billion less than the President’s FY15 request.

The FY15 Commerce-Justice-Science appropriations bill that was approved by the full House Appropriations committee on May 8 was considered by the House Rules Committee earlier this week. The bill is expected to be considered on the House floor next week. The Rules Committee approved an open rule meaning that any Member may offer an amendment during floor consideration of the bill.

Senate

The Senate Appropriations Committee marked up its FY15 Military Construction-Veterans Affairs and Agriculture, Rural Development, FDA and Related Agencies spending bills in subcommittee on Tuesday and full committee on Thursday.

The Senate’s $20.575 billion FY15 Agriculture appropriations bill is slightly lower than the House’s version and $90 million below the FY14 enacted level, but $228 million above the President’s budget request. The bill includes $100 million in disaster relief funding as well as $1.139 billion for the Agriculture Research Service; $6.623 billion for WIC; $1.094 billion for rural development rental assistance; $1.7 billion in water and waste loans and grants; $25 billion for single family housing financing; $2.588 billion for the FDA; $1.183 billion for the Farm Service Agency; and $876 million for the Animal and Plant Health Inspection Service. During the full committee markup, Sen. Susan Collins (R-ME) offered an amendment to add fresh white potatoes to the eligible items list for the WIC program. The amendment was agreed to.

The Senate also marked up its $71.898 billion FY15 Military Construction-Veterans Affairs bill. This bill could be the first bill to hit the Senate floor in late June. The bill provides $6.559 billion for military construction and family housing, $3.25 billion below the FY14 enacted level. It also provides $158.6 billion for the Department of Veterans Affairs (VA) for FY15, $93.5 billion of which is for mandatory programs (equal to the request and $8.8 billion above the FY14 enacted level). For VA discretionary funding the bill provides $65.1 billion, $1.85 billion above the FY14 enacted level. The bill appropriates $5 million for the VA’s inspector general to conduct an investigation into accusations that veterans died while awaiting care at a Phoenix VA hospital. The bill also provides $326.4 million to modernize the VA’s Electronic Health Record System, and requires oversight controls to ensure that interoperability remains the focus of efforts within both the VA and DOD as they modernize their respective electronic health record systems.

The committee also approved its 302(b) allocations. Chairwoman Barbara Mikulski (D-MD) moved some State Department funding into the OCO account to avoid making cuts to domestic programs for FY15. The allocations were approved 16-14.

The 302(b) allocations for the House and Senate are as follows:

*in millions

FY2015 Appropriations Bill Status

FY15 National Defense Authorization Act

The House passed the FY2015 National Defense Authorization Act this week by a vote of 325 to 98. The bill provides $495.8 billion for the core defense budget, $17.9 billion for energy programs, and $79.4 billion for the war in Afghanistan and other overseas operations. The bill does not specify where the overseas contingency funds are to be spent because the administration has yet to formally submit a detailed budget request for the account to Congress. The House Rules Committee allowed 162 amendments to be offered during floor consideration. Ranking Member Adam Smith (D-WA) criticized fellow lawmakers for “ducking every difficult decision” and “playing accounting games and cutting readiness.” Smith had proposed amendments to authorize a 2017 BRAC and permit the Navy to take cruisers out of service, neither of which were made in order.

Some of the amendments that were agreed during floor consideration include requiring the president to report to Congress on the identity and location of the perpetrators of the attack on the US consulate in Benghazi; restricting funding for the implementation of the 2010 New START nuclear arms reduction treaty until the Defense secretary certifies that Russia is no longer occupying Ukranian territory; requiring the DOD IG to publicly release reports of investigations that confirm misconduct by members of the senior executive service, political appointees or commissioned officers in the armed forces in pay grades O-6 or above; and requiring the GAO to complete a report on the National Telecommunications & Information Administration’s planned hand-off of some oversight of the ICANN (Internet Corporation for Assigned Names and Numbers) domain naming system.

Chairman Buck McKeon (R-CA) said that he hopes to conference the bill with the Senate and complete action before the November election. The White House issued a veto threat (although the vote count makes it veto proof) over the inclusion of restrictions regarding Guantanamo detainees as well as other issues that made the final bill.

The Senate Armed Services Committee marked up its version of the FY15 NDAA in subcommittee and full committee this week. The committee passed the bill on Thursday by a vote of 25 to 1 (Sen. Mike Lee, R-UT was the lone dissenter). The bill authorizes $514 billion in FY15 for the Department of Defense and the national security programs of the Department of Energy. The Senate also rejected many of the administration’s proposed cost-cutting proposals including reversing the proposal to retire the Air Force’s A-10 attack jets, BRAC, and cut compensation costs. However, unlike the House bill, the Senate bill provides a path to closing the Guantanamo detention facility by authorizing the transfer of detainees to the United States, subject to a congressional vote on a joint resolution of disapproval. Green energy advocates are applauding several provisions in the bill including authorization for DOD programs establishing infrastructure for natural gas and other alternative fuel vehicles and requiring DOD to set up an office to manage R&D and deployment of radios and other equipment powered by solar or other advanced sources. A committee summary of the bill can be found at: https://www.vantagepointstrat.com/?attachment_id=197.

The biggest issue the two committees may have to resolve during conference negotiations is the official title of this year’s NDAA. As both HASC Chairman McKeon and SASC Chairman Carl Levin (D-MI) are retiring at the end of the year, the House and Senate versions of the bill are being named after them, respectively.

Homeland Security

The House Homeland Security Committee marked up three bills in subcommittee this week: HR 3202, the Essential Transportation Worker Identification Credential (TWIC) Assessment Act; HR 3488, a bill establishing the conditions under which the Secretary of Homeland Security may establish preclearance facilities, conduct preclearance operations, and provide customs services outside the United States; and HR 3846, the US Customs and Border Protection Authorization Act. HR 3202 was introduced by Rep. Sheila Jackson Lee (D-TX) last Fall in response to a June 2013 GAO report on the TWIC program. The bill would require the Secretary of DHS to prepare a comprehensive security assessment of the TWIC program as well as a corrective action plan. HR 3846 would provide for the authorization of border, maritime, and transportation security responsibilities and functions in DHS. This measure is the first to formally authorize CBP and clarify the security missions of the Department since the Department of Homeland Security was created in 2002.

Cybersecurity

The Senate Homeland Security and Governmental Affairs Committee (HSGAC) marked up S 2354 the DHS Cybersecurity Workforce Recruitment and Retention Act of 2014 in committee this week. The bill gives the DHS Secretary hiring and compensation authorities for cybersecurity experts like those of the Secretary of Defense. Ranking member Tom Coburn (R-OK) said that he is supportive of the bill with a caveat that it has to have an offset. Chairman Tom Carper (D-DE) assured Sen. Coburn that he would hold the bill on the floor until an offset is identified. One potential offset is savings from S 1691, the Border Patrol Agent Pay Reform Act sponsored by Sen. Jon Tester (D-MT) and Sen. John McCain (R-AZ). The bill was also on the markup schedule for the committee, but was pulled after Sen. Coburn raised concerns. Sen. Tester offered to hold a hearing on S 1691 after the Memorial Day recess to address Sen. Coburn’s concerns. Sen. Mary Landrieu (D-LA), Chair of the Senate Homeland Security Appropriations subcommittee and a member of the Senate HSGAC raised concerns about the bill’s focus on the need to hire cybersecurity workers in the DC area. Landrieu said that one of the solutions to the problem is to find talent outside of the Beltway where $185,000 is a more competitive salary. Instead of opposing the bill, Landrieu voted “present” after Chairman Carper assured her he would work with her to assuage her concerns prior to Senate floor action. Sen. Rob Portman (R-OH) offered an amendment to the bill that would require DHS to implement the framework for the federal cybersecurity workforce from the National Initiative for Cybersecurity Education that would provide a common lexicon and job codes. After being amended, the bill passed by voice vote.

When the White House issued Executive Order (EO) 13636 “Improving Critical Infrastructure Cybersecurity in February 2013, the administration required all Executive Branch agencies (not independent regulators) to assess whether and how existing cybersecurity regulation could be streamlined and better aligned with the Cybersecurity Framework launched in February 2014. The EO specifically directed Executive Branch departments and agencies with responsibility for regulating the security of private-sector critical infrastructure to: (1) assess the sufficiency of existing regulatory authority to establish requirements based on the Cybersecurity Framework to address current and projected cyber risks; and (2) identify proposed changes in order to address insufficiencies identified. Three departments and agencies were required to submit reports: Environmental Protection Agency (drinking water and waste-water), Department of Health and Human Services (medical devices, electronic health records, health exchanges), and the Department of Homeland Security (chemical facilities and transportation). The agencies responded to the White House this week in reports made public Thursday afternoon that current law gives them authority to regulate cybersecurity in sectors of privately owned critical infrastructure, but that they were reluctant in calling for new regulations. Their individual reports can be found here:

DHS: http://www.dhs.gov/publication/eo-13636-improving-ci-cybersecurity

HHS: http://www.dhs.gov/publication/eo-13636-improving-ci-cybersecurity

EPA: http://water.epa.gov/infrastructure/watersecurity/upload/EO_13696_10-b-_EPA_response.pdf

NSA

Even though Google, Facebook and other tech groups joined privacy advocates and pulled their support for HR 3361, the USA Freedom Act citing concerns that vaguely worded provisions in the modified bill could allow bulk collection of Americans’ phone records to continue, the bill passed the House this week by a vote of 303 to 121. The modified bill terminates the authority to collect metadata in bulk but also provides a means for the FISA court to order production of metadata associated with individual identifiers and those within two hops of those identifiers. The Administration endorsed the bill on Wednesday in a Statement of Administration Policy stating that the bill ensures “intelligence and law enforcement professionals have the authorities they need to protect the Nation, while further ensuring that individuals’ privacy is appropriately protected.” The controversy over whether or not the bill ends bulk collection stems from the change in the bill for the definition of “specific selection term.” The change in the definition came after weeks of negotiation with the administration. Opponents to the bill were concerned that the new definition was too vague and would not end bulk collections. The bill requires notices to Congress and the public when the court makes any new interpretation of that definition.The FISA Court will likely issue an opinion interpreting the term and the bill as a whole. The Senate may try to tighten up some of the language when they consider it, but in doing so may lose the support of the intelligence community. Timing of Senate consideration is unclear at this point.

Political Updates

Later today Housing and Urban Development (HUD) Secretary Shaun Donovan is expected to be nominated by President Obama to be the next director of the Office of Management and Budget. Donovan would replace Sylvia Mathews Burwell who was nominated to be the next secretary of Health and Human Services. Donovan will be replaced at HUD by San Antonio Mayor Julián Castro.

Two cities, Las Vegas and Cincinnati, withdrew their bids this week from the Republican National Committee (RNC) to host the 2016 Republican convention. The RNC site selection committee will now make visits to the four remaining would-be host cities: Cleveland, Dallas, Denver, and Kansas City, Missouri. Last month, the Democratic National Committee (DNC) asked 15 cities to bid:: Atlanta, Chicago, Cleveland, Columbus, Detroit, Indianapolis, Las Vegas, Miami, Nashville, New York, Orlando, Philadelphia, Phoenix, Pittsburgh, and Salt Lake City. Initial proposals are due back in the next few weeks; then party officials will start the review process.
Robert Gates, the former secretary of defense and director of the Central Intelligence Agency, was elected president of the Boy Scouts of America on Thursday.

Next Week

The House will take up the FY15 CJS appropriations bill as well as HR 4681, a bill authorizing classified funding levels for U.S. intelligence agencies for FY14 and FY15. The Senate is in recess next week, but will take up Sylvia Mathews Burwell’s nomination to be Health and Human Services secretary when they return.

May 16, 2014

The Senate failed to invoke cloture on S 2262, the Energy Savings and Industrial Competitiveness Act and on their tax extenders legislation (S 2260). The House was in recess this week.

FY2015 Appropriations

The House is scheduled to markup its FY15 Agriculture, Rural Development, FDA and Related Agencies spending bill in subcommittee next week. The FY15 Commerce-Justice-Science appropriations bill that was approved by the full committee on May 8 will go to the Rules Committee next week and the House floor the following week.

The 302(b) allocations for the House are as follows:

*in millions

Senate Appropriations chairwoman Barbara Mikulski (D-MD) said this week that her goal is to have all of the non-national security appropriations bills marked up in committee by the July 4th recess. The national security appropriations bills would follow and be done by July 10. Bills will start coming to the Senate floor the second week in July. Senate Defense Appropriations chairman Richard Durbin (D-IL) confirmed that schedule this week saying that he wants to have his bill drafted by the first week of July (July 7 as Congress is in recess the previous week).

Sen. Mikulski kicked off the FY15 appropriations process this week by informing subcommittee chairs of their tentative 302(b) allocations. The full committee will finalize the allocations next Thursday. Senate Republicans are meeting next week to decide if they will support the allocations. Controversy over the allocations stems from a $4.3 billion accounting disparity between the Office of Management and Budget and the Congressional Budget Office related to government earnings from Federal Housing Administration-insured mortgages and the need to find offsets for that disparity. In addition to approving the 302(b)s next week, the committee will also markup the FY15 Agriculture and Military Construction-Veterans Affairs spending bills in subcommittee on Tuesday and full committee on Thursday.

FY2015 Appropriations Bill Status

FY15 National Defense Authorization Act

The FY15 National Defense Authorization Act (NDAA) will be debated on the House floor next week. Amendments are due to the House Rules Committee by 10 am on Monday. Some likely amendments include blocking the purchase of helicopters from Russian contractors, as well as proposals to remove the military chain of command from decisions to prosecute sexual assault cases and to allow relocation of detainees held at Guantánamo Bay, Cuba. On the Senate side, the Senate Armed Services Committee (SASC) has the following markup schedule next week:

Tuesday, May 20, 2014

9:30 a.m. — Subcommittee on Airland. OPEN. Room SD-G50.

11:00 a.m. —Subcommittee on Seapower. CLOSED. Room SR-222.

2:00 p.m. —Subcommittee on Strategic Forces. CLOSED. Room SR-222.

3:30 p.m. —Subcommittee on Readiness and Management Support. OPEN. Room SD-G50.

5:00 p.m. —Subcommittee on Emerging Threats and Capabilities. OPEN. Room SD-G50.

Wednesday, May 21, 2014

10:00 a.m. —Subcommittee on Personnel. OPEN. Room SD-G50.

Wednesday, May 21, 2014

2:30 p.m. — 9:00 p.m. Full Committee. CLOSED. Room SR-222.

Thursday, May 22, 2014

9:30 a.m. — 9:00 p.m. [with a break for lunch] Full Committee. CLOSED. Room SR-222.

If markup is not completed on Thursday, May 22, then:

Friday, May 23, 2014

9:30 a.m. — Completion Full Committee. CLOSED. Room SR-222.

Tax Extenders

The Senate failed this week to invoke cloture on their tax extenders bill (S 2260). The $85 billion extenders bill would have renewed for two years nearly all of the 55 tax breaks that expired on Dec 31. Some of the energy tax breaks included in the bill are a renewable electricity production tax credit, credits for cellulosic biofuels, biodiesel and renewable diesels, home energy efficiency upgrades, new energy efficient homes and commercial buildings, alternative fuel refueling property, electric motorcycles, and fuel cell motor vehicles. Other tax breaks in the bill include the research credit, a provision allowing companies to defer US taxes on overseas financing operations, continuing the 50% bonus depreciation for capital investments, letting teachers deduct out-of-pocket expenses for school supplies, letting homeowners exclude forgiven debt from income, providing incentives for businesses to hire veterans and other members of disadvantaged groups, and a cost depreciation for racehorses. While the bill had bipartisan support when it was marked up and approved by voice vote in the Senate Finance Committee, Senate Democrats and Republicans disagreed over offering amendments on the Senate floor. The bill isn’t likely to come up again until after the elections in November.

On the House side, members are pursuing a piece-by-piece approach. Last week they passed a $156 billion bill (HR 4438) to permanently extend the research and development credit. The White House threatened to veto the bill because there was no offset.

Political Updates

The Wayne County Clerk’s office ruled this week that Rep. John Conyers (D-MI) is ineligible to appear on the Aug. 5 primary ballot because he did not submit enough valid petition signatures. Conyers is expected to appeal the ruling, but could also run a write-in campaign if he is unsuccessful in his appeal. Conyers is the Ranking Member on the House Judiciary Committee.

Deputy Secretary of Defense Robert Work announced this week that Terry Halvorsen, Navy Chief Information Officer, would become the department’s acting CIO on May 21 replacing Teri Takai who stepped down May 2.

The President nominated Victor Mendez to be Deputy Secretary of Transportation and Peter Rogoff to be Under Secretary of Transportation for Policy. Mendez has been Administrator of the Federal Highway Administration at the Department of Transportation (DOT) since 2009 and was designated the Acting Deputy Secretary of Transportation in 2013. Prior to this position, he was a member of former Arizona Governor Janet Napolitano’s Cabinet, serving as the Director of the Arizona Department of Transportation (ADOT) from 2003 to 2009. Peter Rogoff has been the Federal Transit Administrator (FTA) for DOT since 2009 and was designated Acting Under Secretary of Transportation for Policy in 2014. Prior to joining the FTA, he served as a Democratic Staff Director on the Senate Transportation Appropriations Subcommittee 1995 to 2009.

On Monday President Obama formally withdrew the nomination of Tommy Beaudreau to be the assistant secretary of the interior, since Beaudreau has instead become Interior Secretary Sally Jewell’s Chief of Staff. His nomination was sent to the Senate in January after being announced in October. Beaudreau first came to Interior in June 2010 to reorganize the federal government’s oversight of offshore oil and gas drilling, and became director of the Bureau of Ocean Energy Management in 2011.

Next Week

The House will consider the FY15 National Defense Authorization Act on the floor. The House could also vote on legislation to scale back bulk collection of domestic phone records by the National Security Agency and other government entities. The Senate will consider two nominations early in the week.

May 9, 2014

The House passed a resolution establishing a select committee of seven Republicans and five Democrats to investigate the September 2012 attack on the US Consulate in Benghazi. They also passed a bill changing federal regulations of charter schools (HR 10), a bill making permanent a research and development tax credit (HR 4438), and the Electrify Africa Act, which requires the President to establish a comprehensive, multiyear strategy for the US to help sub-Saharan African nations to improve access to electricity in Africa. The House also passed a measure, mostly along party lines, holding former IRS official Lois Lerner in contempt of Congress. The matter now goes to the Justice Department. The Senate voted on cloture on the motion to proceed on S 2262, the Energy Savings and Industrial Competitiveness Act (also referred to as the Shaheen-Portman energy efficiency bill), but Senate leaders were not able to strike a deal to move forward on the bipartisan bill. The Senate did pass a bill clarifying DC rules regarding occupancy of penthouses above the top story of a building in addition to a number of judicial nominations.

FY2015 Appropriations

House Appropriations Chairman Hal Rogers (R-KY) laid out his plan on Tuesday for dividing the $1.014 trillion in discretionary budget authority for FY15 among the 12 appropriations subcommittees. The full committee voted on the allocations on Thursday and approved them in a partisan 25-20 vote.Senate allocations were also expected to be released this week, but they were delayed due to an accounting disagreement between OMB and CBO over the calculation for the government’s earnings from mortgages insured by the Federal Housing Administration leaving a $4.3 billion difference. House appropriators made up for this $4.3B difference with cuts to some Transportation-HUD appropriations accounts. The Senate is expected to finalize their 302(b) allocations before their anticipated first subcommittee markup on May 22. Both House and Senate appropriations committees are expected to adhere to the $1.014 trillion in discretionary funding set aside for FY15 under the December budget deal. The deal capped discretionary spending at $521.3 billion for defense programs and $492.4 billion for non-defense programs.

The 302(b) allocations for the House are as follows:

*in millions

In addition to agreeing to the proposed 302(b) allocations, the House Appropriations Committee also marked up their $51.2 billion FY15 Commerce-Justice-Science (CJS) bill in full committee on Thursday. This is a $398 million decrease from FY14. The Department of Justice (DOJ) receives $27.8 billion (a $383 million increase over FY14) in bill with increased spending levels for DOJ law enforcement agencies including the FBI, DEA, US Marshals, and ATF. The bill also provides $8.4 billion for the Commerce Department, a $171 million increase over FY14 with the Census Bureau receiving an additional $1.1 billion to prepare for the next census. NASA and NSF also received increases of $237 million over FY14 with funding set at $17.9 billion for NASA and $7.4 billion for NSF. The bill was approved by a voice vote after the committee accepted an amendment to withhold funding for efforts to make gun dealers inform DOJ when they sell multiple rifles or shotguns to the same person within five days.

The House also began marking up their FY15 Transportation-HUD spending measure in subcommittee this week. The bill provides $52 billion in discretionary funding for infrastructure and housing programs, a $1.2 billion increase over FY14 but $7.8 billion less than the President’s FY15 request. However, given the accounting disagreement between OMB and CBO over the calculation of Federal Housing Administration receipts, the program level within the bill is more accurately $1.8 billion below the current level. HUD funding was cut by $769 million from FY14 funding levels and $2 billion less than the President’s request. TIGER grants were also cut by $500 million from FY14 levels ($1.15 billion less than requested by the President), and projects such as streetscaping, or bike and pedestrian paths are no longer eligible for this funding. The FAA received a slight decrease of $7.3 million and was funded at $15.7 billion. The bill also fully funds the FAA’s Next Generation Air Transportation Systems (NextGen) at $852.4 million, and funds Contract Towers at $140 million. The Federal Railroad Administration’s safety programs were increased to $220.5 million. The Maritime Administration saw a decrease of $72 million from FY14 with funding at $305 million. The bill was approved by voice vote and will be marked up in full committee the week of May 19 when the House returns from their mid-May recess.

The House is expected to take up the Homeland Security spending bill after the mid-May recess.

The Senate Appropriations Committee continues with hearings next week on FY15 funding for defense research and innovation, the Securities and Exchange Commission, and the US Commodity Futures Trading Commission.

NSA Surveillance Reform

Two House Committees (Judiciary and Intelligence) were initially moving ahead this week with competing proposals to reform the government’s surveillance programs. The contest between the two committees began earlier this year when HR 4291, the FISA Transparency and Modernization Act, was introduced by House Intelligence Committee Chairman Mike Rogers (R-MI) and Ranking Member Dutch Ruppersberger (D-MD) and referred to their committee by the House parliamentarian. Some House Judiciary Committee members raised concerns that matters involving the legal authority of the intelligence community fall under their committee’s jurisdiction.

The House Judiciary Committee decided to move forward this week with their bill, the USA Freedom Act (HR 3361). The bipartisan bill was approved in committee 32 to 0 and would prohibit the bulk collection of telephone metadata under Section 215 of the PATRIOT Act under the FISA Pen Register/Trap and Trace law (Section 402 of FISA), and under National Security Letter statutes. The bill also creates a new process for obtaining call records; requires the government to adopt procedures to minimize the retention and prohibit the dissemination of nonpublic information about Americans; provides for judicial review of minimization procedures; creates a panel of legal experts to help ensure the FISA court adequately considers privacy concerns; requires the Attorney General to conduct a declassification review of each decision, order, or opinion of the FISA court that includes a significant construction or interpretation of the law; requires the government to disclose the number of requests made for call detail records under the new collection program; requires the Administrative Office of the U.S. Courts to publicly report annually the number of FISA orders issued, modified, or denied by the FISC; and allows companies to semi-annually publicly report requests for information they receive under FISA and National Security Letter authorities.

The House Intelligence Committee had intended to mark up their FISA Transparency and Modernization Act in a closed session this week, but after negotiations with House leadership and the Judiciary Committee they elected to not hold a vote on their bill and instead considered and passed by voice vote the Freedom Act. The bill now heads to the House floor and is expected to be cleared before Memorial Day. Sen. Patrick Leahy (D-VT) has sponsored a companion version of the Freedom Act in his chamber, but timing for consideration in the Senate is only stated as “this summer.”

FY15 National Defense Authorization Act

The House Armed Services Committee met in full committee this week to mark up their FY15 National Defense Authorization Act (NDAA) (HR 4435). The committee unanimously approved the bill and it now goes to the House floor for consideration the week of May 19.

The HASC bill authorizes $521.3 billion in spending for national defense, and an additional $79.4 billion for Overseas Contingency Operations (OCO). This is consistent with the President’s budget request and the bi-partisan budget agreement reached last December, however, it is $45 billion less than the President requested in FY14 and $30.7 billion less than Congress enacted in FY14.

BRAC

The Committee rejected the President’s proposed BRAC round maintaining that “BRAC rounds do not yield true savings but rather impose large up front costs only then to shift property between federal agencies.” The committee also rejected an amendment offered by Rep. Smith during the full committee markup that would have allowed the Pentagon close excess military facilities but with the requirement that savings would have to be realized within five years. The bill instead requires DoD to report on several BRAC related topics, including a report on excess capacity, a report on the property disposal process, and an assessment of each prior BRAC round – listing by acre property disposals and acreage left to dispose of, an assessment of land sale revenues, the cost of environmental cleanup and caretaker services, and how much remediation is left to do.

Military Compensation and Benefits

In his FY15 budget request, the President proposed cuts to TRICARE, Housing Allowances, and Commissary benefits. The FY13 NDAA established a military compensation commission to examine a range of reforms and report back to Congress. HASC Chairman Buck McKeon (R-CA) stated that military compensation reform should be addressed comprehensively, and that the committee is not willing to make reforms until the commission provides its recommendations. However, the bill does require DoD to consult with outside experts in retail grocery sales to find efficiencies in the commissary system.

Troop Pay

The chairman’s mark supports current law, which mandates an automatic 1.8% increase in troop pay, but also calls for a pay freeze for General and Flag Officers for FY15.

Sexual Assault in the Military

The bill eliminates the “good soldier defense” – a consideration of general military character toward the probability of innocence in sexual assault prosecutions. The proposal also calls for a review of the terms of discharge for those who are victims of sexual offenses, to ensure that they have not been persecuted for reporting crimes. Victims would also be consulted as to their preference for prosecuting offenders by court-martial or through civilian channels.

Military Suicide

The committee directs the Secretary of Defense to track the issue closely and authorizes a total of $45.3 million dollars towards behavioral and psychological health programs and efforts specifically for Special Operations Forces. Funding for the USSOCOM Behavioral Health and Warrior Care Management Program is increased from $14.8 million to $38.1 million to immediately increase the number of embedded behavioral health care providers including psychologists, social workers, nurse case managers, and operational psychologists. And the USSOCOM Psychological Performance Program was fully funded at the $7.2 million dollar requested level.

Military Readiness

Readiness programs were increased by $1 billion to address critical readiness gaps associated with depot maintenance, flying hour programs and base operations support caused by sequestration and repeated resource cuts.

Afghanistan

The Chairman’s proposal expresses Congress’ support for Operation Resolute Support and for the Bilateral Security Agreement (BSA). The bill also expresses the committee’s view that the counternarcotics mission be included in the core enduring mission set. The Chairman’s Mark proposes establishing the “1230 Report” on Progress Toward Security and Stability in Afghanistan for the post-2014 environment, extends the Commander’s Emergency Response Program (CERP) in Afghanistan, requires a plan for monitoring DoD funded construction activities in Afghanistan post-2014, and requires a report on the financial management capacity of the Afghan ministries of Defense and Interior. The bill also requires the Secretary of Defense to submit an ANSF sustainment plan through the end of FY18. And finally, the proposal directs DoD to withhold DoD assistance to Afghanistan in an amount equal to 150% of the illegal taxes assessed by Afghanistan on those foreign activities promoting Afghan progress, security, and stability.

Overseas Contingency Operations Funding

Chairman McKeon is concerned that many enduring requirements beyond the Afghanistan mission are being funded through the Overseas Contingency Operations (OCO) account and called for a report on enduring requirements currently funded through OCO. The bill does not contain any specifics on war funding as Congress is still waiting for the administration’s FY15 OCO request. However, the panel rejected a $115 million request for the Joint Improvised Explosive Device Defeat Organization as an “unjustified request,” but moved about $65 million of those funds to the OCO account.

Institutional Reform

The Chairman’s proposal restores the Office of Net Assessment (ONA) to its independent status, with the Office reporting directly to the Secretary of Defense, and increases the ONA budget for FY15 by $10 million to $18.9 million. The bill also directs the Secretary of Defense to report on combining combatant command back office functions to achieve greater efficiencies and cost savings. The Mark would also task GAO to assess DoD’s headquarter reduction efforts, building off its previous work conducted for the committee on examining growth in DoD headquarters.

Acquisition Reform

The FY08 NDAA established the requirement for an annual inventory of services contracts, but the Department has yet to fully implement this requirement. The Chairman’s Mark encourages the Secretary to improve data collection for services contracting and conduct better analysis of the data to identify waste. GAO is tasked to report on opportunities to improve services contract processes. And the Director of Operational Test and Evaluation (DOT&E) is directed to consider the potential for increase in program cost estimates or delays in schedule estimates in the implementation of policies, procedures, and activities related to operational test and evaluation.

Security Reform

To prevent unauthorized disclosure of classified information, the Chairman’s Mark directs the Secretary of Defense to provide the committee with frequent reports on its damage assessment resulting from these unauthorized disclosures and steps the Department is taking to mitigate the damage.

Strategy Reform

The bill requires DOD to resubmit the 2014 Quadrennial Defense Review (QDR) with specifying the resources required to execute the strategy at a low-to-moderate level of risk. The bill restricts 25% of OSD Policy funding until the revised QDR is submitted. Chairman McKeon and Ranking Member Smith also offered a bipartisan amendment during the markup that overhauls the QDR. The new QDR will require tradeoff analyses between missions, risks, and resources; reshape the role of the independent National Defense Panel; and require a separate Quadrennial Threats and Trends Report.

National Guard

The introduced bill did not get involved in the feud over shifting the National Guard’s Apache helicopters to the active-duty Army. However, during the full committee markup, Rep. Joe Wilson (R-SC) offered an amendment that would freeze cuts to the Army Guard for one year while GAO studies the Army force structure (due March 2015), holds end strength for the Active Army at 490,000 and Army Guard at 350,000, and bars the Army from transferring the Guard’s Apache attack helicopters to the active service. The amendment passed by voice vote.

Asia Rebalance

Rep. Randy Forbes (R-VA) offered several amendments during full committee markup dealing with the pivot to the Pacific, including one reaffirming the U.S. commitment to its allies in the region.

Guantanamo Bay

The bill maintains prohibitions on the transfer of detainees from the Guantanamo Bay Detention Facility to the United States and on the construction of terrorist detention facilities in the United States.

Oversight of Sensitive Military Operations Act (OSMOA)

The Chairman’s Mark withholds 25% of the funds for the Assistant Secretary for Special Operations and Low Intensity Conflict until the outstanding reporting elements of the OSMOA are received.

Egypt/Syria/Iran

The bill urges the President to shift to an enduring posture in the Middle East and seek status of forces agreements with Gulf Cooperation Council states. The Chairman’s Mark supports the President’s decision to deliver ten Apache helicopters to Egypt for counterterrorism operations. The proposal reflects congressional concern regarding the influx of foreign fighters in Syria and the committee’s belief that “prudent planning” to support regional allies impacted by the Syria conflict is warranted. Finally, an American presence in the Arabian Gulf is necessary to deter Iran; and any negotiations with Iran must address the military aspects of their nuclear program. Rep. Doug Lamborn (R-CO) offered an amendment during full committee markup that calls for additional restrictions on a potential nuclear deal with Iran, including that Iran cease its support of terror groups and its ballistic missile program. It was agreed to by voice vote.

Africa

The bill requires a report on the “new normal” and general mission requirements for AFRICOM, as well as a report on the readiness implications of the Army’s Regionally Aligned Brigade concept in Africa.

Europe and Russia

The bill prohibits U.S. military contact and cooperation with the Russian military until the Secretary of Defense certifies the Russian military is no longer illegally occupying Crimea, no longer acting inconsistently with the Intermediate-range Nuclear Force (INF) treaty, and is in compliance with the Conventional Armed Forces in Europe (CFE) treaty. The National Nuclear Security Administration (NNSA) is barred from transferring technology with Russia until the Secretary of Energy makes the same certifications. The Chairman’s proposal also condemns Russian aggression towards Ukraine and reaffirms the United States commitment to Article V of NATO. The Chairman requires the Secretary of Defense to develop a plan to provide assistance to the European and Eurasian militaries to enhance their defensive capabilities and posture. The Chairman’s Mark increases the budget for the DOD’s Warsaw Initiative Fund/Partnership for Peace (WIF/PfP) program from $24.4 million to $34.4 million to enable U.S. European Command, through military exercises and defense reform efforts, to build the capacity of PfP militaries in order to promote regional stability and to deter Russian aggression. It also cuts all funding for the DOD Cooperative Threat Reduction program and NNSA’s non-proliferation activities with Russia.

Proximity Encroachment

Requires DoD to study gaps and vulnerabilities in the interagency process for public property estate transactions near critical military assets, installations, and training facilities to ensure that foreign-controlled entities are not acquiring these properties with the intent to monitor activities. GAO is tasked to provide a sufficiency review of the DoD study.

Markup Changes

• Doubled the funding for Israel’s Iron Dome missile defense system adding $175 million.
• Authorizes funding for five Growler electronic warfare jets
• $1 billion for maintenance and training accounts.
• Restores the Office of Net Assessment to its independent status.
• Blocks the Air Force from preparing to retire its U-2 spy planes.
• Provides $120 million in funding for eight MQ-9 Reapers.
• Added back $635 million to keep the A-10 Warthog fleet flying through FY15.
• Blocks all funding for LCS mission modules until senior Pentagon and Navy officials deliver some assurances to lawmakers.
• Limits the Pentagon’s ability to retire more than four E-3 airborne warning and control system aircraft.

Finally, as this is the Chairman’s final NDAA, the panel voted to name the bill after him. Rep. Thornberry (R-TX) and Rep. Smith (D-WA) offered it as the final amendment of the night. The amendment was approved, and the committee gave the retiring chairman a standing ovation.

The Senate Armed Services Committee (SASC) FY15 NDAA markup schedule is as follows:

Tuesday, May 20, 2014

9:30 a.m. — Subcommittee on Airland. OPEN. Room SD-G50.

11:00 a.m. —Subcommittee on Seapower. CLOSED. Room SR-222.

2:00 p.m. —Subcommittee on Strategic Forces. CLOSED. Room SR-222.

3:30 p.m. —Subcommittee on Readiness and Management Support. OPEN. Room SD-G50.

5:00 p.m. —Subcommittee on Emerging Threats and Capabilities. OPEN. Room SD-G50.

Wednesday, May 21, 2014

10:00 a.m. —Subcommittee on Personnel. OPEN. Room SD-G50.

Wednesday, May 21, 2014

2:30 p.m. — 9:00 p.m. Full Committee. CLOSED. Room SR-222.

Thursday, May 22, 2014

9:30 a.m. — 9:00 p.m. [with a break for lunch] Full Committee. CLOSED. Room SR-222.

If markup is not completed on Thursday, May 22, then:

Friday, May 23, 2014

9:30 a.m. — Completion Full Committee. CLOSED. Room SR-222.

Political Updates

Bob Work was sworn in as the 32nd Deputy Secretary of Defense on Monday.

The Immigration and Customs Enforcement (ICE) directorate in the Department of Homeland Security named Kevin Kern as its next chief information officer (CIO). Kern replaces Thomas Michelli who moved to be the deputy CIO at the Coast Guard and is expected to replace Adm. Robert Day, the Coast Guard’s CIO when he retires this summer. Kern served as a senior vice president and CIO at Unisys and has more than 30 years of experience in global operations and technology in various industries including high technology, healthcare, financial services and manufacturing. Kern will manage ICE’s $600 million IT budget and manage its IT infrastructure and operations, which includes eight major projects. The agency’s biggest program by cost at $189 million is its IT infrastructure that covers 14 different projects, including desktop services, local area network upgrades and more. One of Kern’s main priorities will be getting its TECS modernization back on track. ICE also is expected to name a deputy CIO in the coming weeks.

Next Week

The House is in recess next week. The Senate is in session next week and will continue debate on the Shaheen-Portman energy efficiency bill. Next on their agenda is tax extenders legislation.

May 2, 2014

The House passed the FY15 Military Construction-VA and Legislative Branch appropriations bills, as well as a bill exempting expatriate health plans from the requirements of the Affordable Care Act (Obamacare). The House also unanimously approved by voice vote the Senate passed version of the DATA Act, a transparency measure requiring federal bodies to publish spending information in clear, standardized formats. The President is expected to sign this bill into law. The Senate failed in a vote of 54 to 42 to invoke cloture on a bill to raise the hourly minimum wage to $10.10 by 2016.

FY2015 Appropriations

The House marked up their $51.2 billion FY15 Commerce Justice Science (CJS) Appropriations bill in subcommittee this week. The bill funds the Departments of Commerce and Justice as well as NASA and other federal research agencies. This bill is a $398 million cut from the FY14 bill, which was funded at $51.6 billion. It will be marked up in full committee next week. DOJ is the big winner with a $383 million increase over FY14, followed by NASA with an increase of $250 million. The National Science Foundation also receives a record high of $7.4 million. But those increases come at a cost with the bill eliminating several existing programs and cutting funding for programs like the Community Oriented Police Services hiring grants.

The FY15 Military Construction-Veterans Affairs (MilCon-VA) and Legislative Branch spending bills were considered on the House floor this week. The $71.5 billion MilCon-VA moved under an open rule allowing House members to offer any amendments, while the $3.3 billion Legislative Branch bill moved under a structured rule limiting amendments. The House first passed the MilCon-VA bill by a vote of 416 to 1 after considering around two dozen amendments. The bill provides $165 billion in FY15 for the VA and military construction projects. One unsuccessful amendment offered by Rep. Jim Moran (D-VA) would have barred funds from being used to construct, alter, or expand a facility in the US for housing Guantanamo Bay detainees. Members did approve an amendment that would prohibit funds from being used for BRAC activities.

The Legislative Branch spending bill passed by a vote of 402 to 14. The bill holds funding steady for member offices’ budgets and maintains the member pay freeze that has been in place since 2010. An amendment providing $500,000 for sexual harassment training for House offices was approved, but one cutting funding for the Capitol Visitors Center was defeated.

During the full committee markup next week, the committee is also expected to agree on the 302(b) spending allocations for the ten remaining FY15 appropriations bills. After CJS, the committee is expected to take up the Transportation-Housing and Urban Development bill next Wednesday and the Homeland Security spending bill after the mid-May recess. The Transportation-HUD spending bill is the bill that triggered the collapse of the appropriations process last year. The prospects this year for the bill are a little brighter with a bipartisan discretionary top-line figure in place and a temporary fix to the Highway Trust Fund expected this year.

The Senate continues to hold hearings on the FY15 budget and is expected to move the MilCon-VA and Legislative Branch bills in late May/early June. The MilCon-VA bill may be marked up in full committee on May 22.

FY15 National Defense Authorization Act

The House Armed Services Committee (HASC) marked up their FY15 National Defense Authorization Act (NDAA) in subcommittee this week. The subcommittees’ markups are being incorporated into the full committee markup, which will take place next Wednesday May 7 at 10 am. The text of the full committee markup will be released on Monday.

The Senate Armed Services Committee (SASC) FY15 NDAA markup schedule is as follows:

Tuesday, May 20, 2014

9:30 a.m. — Subcommittee on Airland. OPEN. Room SD-G50.

11:00 a.m. —Subcommittee on Seapower. CLOSED. Room SR-222.

2:00 p.m. —Subcommittee on Strategic Forces. CLOSED. Room SR-222.

3:30 p.m. —Subcommittee on Readiness and Management Support. OPEN. Room SD-G50.

5:00 p.m. —Subcommittee on Emerging Threats and Capabilities. OPEN. Room SD-G50.

Wednesday, May 21, 2014

10:00 a.m. —Subcommittee on Personnel. OPEN. Room SD-G50.

Wednesday, May 21, 2014

2:30 p.m. — 9:00 p.m. Full Committee. CLOSED. Room SR-222.

Thursday, May 22, 2014

9:30 a.m. — 9:00 p.m. [with a break for lunch] Full Committee. CLOSED. Room SR-222.

If markup is not completed on Thursday, May 22, then:

Friday, May 23, 2014

9:30 a.m. — Completion Full Committee. CLOSED. Room SR-222.

Homeland Security

The House Homeland Security Committee marked up three bills in full committee this week: HR 4228, the DHS Acquisition Accountability and Efficiency Act; HR 4007, the Chemical Facility Anti-Terrorism Standards Program Authorization and Accountability Act; and HR 3283, the Integrated Public Alert and Warning System Modernization Act of 2013.

Cybersecurity

The Senate Intelligence Committee released a draft cybersecurity bill this week that would enable companies to share threat data with federal agencies without fear of getting sued. The new bill states that no lawsuit may be brought against a company for sharing threat data with “any other entity or the federal government” to prevent, investigate, or mitigate a cyberattack. The bill also defines cyber threat indicators (data that can be shared) as “information that indicates, describes, or is necessary to identify:

• malicious reconnaissance, including anomalous patterns of communications that appear to be transmitted for the purpose of gathering technical information related to a cybersecurity threat;
• a method of defeating a security control;
• a security vulnerability;
• a method of causing a user with legitimate access to an information system or information that is stored on, processed by, or transiting an information system to unwittingly enable the defeat of a security control;
• malicious cyber command and control;
• the actual or potential harm caused by an incident, including information exfiltrated when it is necessary in order to describe a cybersecurity threat;
• any other attribute of a cybersecurity threat, if disclosure of such attribute is not otherwise prohibited by law; or
• any combination thereof.”

The bill is prompting objections from civil liberties advocates, who argue that the legislation in its current form is too sweeping. There is no timeline right now for when the bill will be introduced. A copy of the bill can be found at:https://www.vantagepointstrat.com/?attachment_id=185.

Big Data

The White House released their “Big Data: Seizing Opportunities and Preserving Values” report today. The 3-month review was led by John Podesta with input from Penny Pritzker, Secretary of Commerce; Ernest Moniz, Secretary of Energy; John Holdren, Director, Office of Science and Technology Policy; and Jeffrey Zients, Director, National Economic Council. The 52-page report was requested by President Obama as part of his January speech on National Security Agency reform.

The report makes six policy recommendations:

1. ADVANCE THE CONSUMER PRIVACY BILL OF RIGHTS. The Department of Commerce should take appropriate consultative steps to seek stakeholder and public comment on big data developments and how they impact the Consumer Privacy Bill of Rights and then devise draft legislative text for consideration by stakeholders and submission by the President to Congress.
2. PASS NATIONAL DATA BREACH LEGISLATION. Congress should pass legislation that provides for a single national data breach standard along the lines of the Administration?s May 2011 Cybersecurity legislative proposal.
3. EXTEND PRIVACY PROTECTIONS TO NON-U.S. PERSONS. The Office of Management and Budget should work with departments and agencies to apply the Privacy Act of 1974 to non-U.S. persons where practicable, or to establish alternative privacy policies that apply appropriate and meaningful protections to personal information regardless of a person?s nationality.
4. ENSURE DATA COLLECTED ON STUDENTS IN SCHOOL IS USED FOR EDUCATIONAL PURPOSES. The federal government must ensure that privacy regulations protect students against having their data being shared or used inappropriately, especially when the data is gathered in an educational context.
5. EXPAND TECHNICAL EXPERTISE TO STOP DISCRIMINATION. The federal government?s lead civil rights and consumer protection agencies should expand their technical expertise to be able to identify practices and outcomes facilitated by big data analytics that have a discriminatory impact on protected classes, and develop a plan for investigating and resolving violations of law.
6. AMEND THE ELECTRONIC COMMUNICATIONS PRIVACY ACT. Congress should amend ECPA to ensure the standard of protection for online, digital content is consistent with that afforded in the physical world?including by removing archaic distinctions between email left unread or over a certain age.

A copy of the report can be found at:https://www.vantagepointstrat.com/?attachment_id=186.

Political Updates

The Senate confirmed by voice vote Robert Work as Deputy Secretary of Defense. Work was most recently CEO of the Center for a New American Security (CNAS). Prior to CNAS, Work was the Under Secretary of the Navy and had a 27-year career as an officer in the US Marine Corps. Christine Fox has been serving as Acting Deputy Secretary of Defense during the transition.

Defense Department Chief Information Officer Teri Takai announced this week that she is stepping down. Her last day is today. A successor has not yet been named and there is some speculation that the administration may not pick a successor instead leaving the Defense CIO position in the hands of Senior Executive Service level staff until the end of President Obama’s second term. Takai became the Defense CIO in 2010.

The White House nominated Defense Secretary Chuck Hagel’s chief of staff, Mark Lippert to become the next U.S. ambassador to South Korea. Before working in Hagel’s office, Lippert was the assistant secretary of defense for Asian and Pacific security affairs from 2011 to 2012. Lippert was also an intelligence officer for Naval Special Operations Forces and a senior foreign policy adviser in Barack Obama’s Senate office and in his 2008 presidential campaign.

At the Defense Intelligence Agency (DIA), agency director LTG Michael Flynn and his deputy, David Shedd, announced this week that they will depart the agency and retire by early Fall 2014.  LTG Flynn has served as the DIA Director since July 2012, while Shedd joined the agency as deputy director in August 2010. LTG Flynn is expected to be replaced by US Army Lt. Gen. Mary Legere, who would be the first female DIA director if she is nominated and confirmed.

Rep. Michael Grimm (R-NY) was indicted earlier this week on 20 criminal charges including mail and wire fraud, filing false tax returns and health care payments, hiring undocumented workers, perjury, and obstruction of justice. While Grimm has denied any wrongdoing, he is vacating his House Financial Services Committee seat. Grimm will remain on the ballot for the November elections.

Rep. Vance McAllister (R-LA) announced this week that he would not seek re-election in 2014. While House Majority Leader Eric Cantor (R-VA) suggested to McAllister that he resign, McAllister said that he would not leave office before his term was finished.

Next Week

The House will take up HR 4438, the American Research and Competitiveness Act of 2014; HR 10, the Success and Opportunity through Quality Charter Schools Act; and a privileged resolution finding former IRS official Lois Lerner in contempt of Congress for refusal to comply with the subpoena issued by the House Committee on Oversight and Government Reform. The Senate will take up S. 2262, the Energy Savings and Industrial Competitiveness Act, with a separate vote on the Keystone XL pipeline as a possibility.

April 25, 2014

The House and Senate were in recess this week and last week.

FY2015 Appropriations

The FY15 Commerce Justice Science (CJS) Appropriations bill will be the next bill House Appropriators consider when they return from their two-week spring recess. The bill is scheduled to be marked up in subcommittee on April 30. The FY15 Military Construction-VA and Legislative Branch spending bills will be on the House floor next week. Action in the House is expected to pick up after the Congressional Budget Office released its score of the FY15 White House budget request on April 17. House Appropriations Committee Chairman Hal Rogers (R-KY) continues to work towards his goal of reporting all 12 annual spending bills by the July 4 recess.

Senate Appropriations Chairwoman Barbara Mikulski (D-MD) said that the FY15 Military Construction-VA bill would be the first bill marked up in her committee, likely followed by the Legislative Branch and CJS bills. The MilCon-VA bill may be marked up sometime around May 22. Mikulski has also said that she will move some bills to the floor individually, while others will be packaged together into “minibuses.”

As a reminder, the deadlines for members of Congress to submit their programmatic and language requests for the FY15 appropriations process are as follows:

FY15 Defense Budget

An internal Pentagon email obtained by Bloomberg News this week indicated that the Department of Defense is preparing three scenarios for FY15 Overseas Contingency Operations (OCO) funding. The scenarios are zero, 5000, and 10,000 US troops stationed in Afghanistan. The President’s FY15 budget request submitted to Congress in March included a $79.4 billion placeholder for OCO funding but did not include any specifics. The email stated that the three scenarios are for budget planning purposes only and did not imply any operational decisions or plans. The email also indicates that the White House Office of Management and Budget plans to negotiate the final OCO funding position with the Department of Defense on May 23.

FY15 National Defense Authorization Act

The House Armed Services Committee (HASC) will release the subcommittee inputs for the FY15 National Defense Authorization Act (NDAA) on Tuesday, 24 hours before the subcommittees will meet to markup their plans. Four HASC subcommittees will mark up their sections on Wednesday, with the two remaining subcommittees conducting their markups on Thursday. The subcommittees’ markups will then be incorporated into the full committee markup, which will take place on May 7 and is led by the chairman. The text of the full committee markup will be released three days beforehand. HASC Chairman Buck McKeon (R-CA) has indicated that his priorities for the FY15 NDAA are intelligence, reconnaissance and surveillance (ISR) assets; nuclear deterrence; and ready forces.

The HASC FY15 NDAA markup schedule is as follows:

Wednesday, April 30, 2014

10:30 AM—Subcommittee on Intelligence, Emerging Threats and Capabilities Markup (Room 2212)

12:00 PM—Subcommittee on Strategic Forces Markup (Room 2118)

1:30 PM—Subcommittee on Seapower and Projection Forces Markup (Room 2212)

3:00 PM—Subcommittee on Military Personnel Markup (Room 2118)

Thursday, May 1, 2014

9:30 AM—Subcommittee on Tactical Air and Land Forces Markup (Room 2118)

10:30 AM—Subcommittee on Readiness Markup (Room 2212)

Wednesday, May 7, 2014

10:00 AM—Full Committee Markup (Room 2118)

The Senate Armed Services Committee (SASC) FY15 NDAA markup schedule is as follows:

Tuesday, May 20, 2014

9:30 a.m. — Subcommittee on Airland. OPEN. Room SD-G50.

11:00 a.m. —Subcommittee on Seapower. CLOSED. Room SR-222.

2:00 p.m. —Subcommittee on Strategic Forces. CLOSED. Room SR-222.

3:30 p.m. —Subcommittee on Readiness and Management Support. OPEN. Room SD-G50.

5:00 p.m. —Subcommittee on Emerging Threats and Capabilities. OPEN. Room SD-G50.

Wednesday, May 21, 2014

10:00 a.m. —Subcommittee on Personnel. OPEN. Room SD-G50.

Wednesday, May 21, 2014

2:30 p.m. — 9:00 p.m. Full Committee. CLOSED. Room SR-222.

Thursday, May 22, 2014

9:30 a.m. — 9:00 p.m. [with a break for lunch] Full Committee. CLOSED. Room SR-222.

If markup is not completed on Thursday, May 22, then:

Friday, May 23, 2014

9:30 a.m. — Completion Full Committee. CLOSED. Room SR-222.

Homeland Security

The House Homeland Security Committee is holding a full committee markup on Wednesday April 30 on HR 4228, the DHS Acquisition Accountability and Efficiency Act; HR 4007, the Chemical Facility Anti-Terrorism Standards Program Authorization and Accountability Act; and HR 3283, the Integrated Public Alert and Warning System Modernization Act of 2013.

Political Updates

Deputy Secretary of State William Burns announced last week that he is stepping down in October. Burns has delayed his retirement several times at the request of the President and Secretary Kerry. His 32-year career in the Foreign Service included stints as US ambassador to Russia and Jordan, top Middle East hand and leader of a team that held secret talks with Iran that led to the current negotiations over that country’s nuclear program.

Rep. Tom Petri (R-WI) announced earlier this month that he would not seek reelection in November. Petri is a centrist Republican with a 35-year history in Congress. He serves on the Transportation and Infrastructure Committee where he is the Chairman of the Subcommittee on Highways and Transit, as well as the Education and Workforce Committee.

Businessman Curt Clawson won the special Republican primary in Florida’s 19th District on Tuesday. The self-funding manufacturing executive and former Purdue University basketball player defeated three other Republicans and becomes the favorite in the June 24 special general election to replace former Rep. Trey Radel (R-FL), who resigned earlier this year after pleading guilty to cocaine possession.

President Barack Obama chose W. Neil Eggleston as his next White House counsel. Eggleston was a partner at Kirkland and Ellis and a Clinton administration veteran with experience representing government officials in oversight investigations.

Next Week

The House and Senate return from a two-week recess. The House will consider the FY15 Military Construction-VA and Legislative Branch appropriations bills. The Senate is expected to take up a bill to raise the hourly minimum wage to $10.10 by 2016 and a tax extenders bill, and hold a confirmation hearing on Sylvia Mathews Burwell for Secretary of Health and Human Services.

April 11, 2014 

In addition to passing an FY15 budget resolution this week, the House passed HR 1871, a bill to modify budget law to eliminate the baseline assumption that discretionary spending increases annually with inflation, and HR 1872, a bill that would account for the costs of market risks in federal credit programs. The Senate completed work on an unemployment aid package providing five months of emergency unemployment benefits retroactively to late December and through May 31. The Senate also unanimously approved a bill (the Digital Accountability and Transparency Act) to make more data about federal spending publicly available. The bill is expected to pass the House quickly and then head to the President for his signature. While the Senate failed to invoke cloture on S 2199, the Paycheck Fairness Act, the President signed two executive orders to prevent pay discrimination. One requires federal contractors to no longer forbid employees from discussing their pay, while the other directs the Department of Labor to collect aggregate pay information from federal contractors broken down by gender and race.

FY2015 Budget

House Budget Chairman Paul Ryan’s (R-WI) FY15 budget resolution was considered on the House floor this week and passed by a vote of 219 to 205. While there was some concern that conservatives might not back the measure, in the end only 12 Republicans (and all Democrats) voted against it. The resolution proposes to cut $5.1 trillion in spending over 10 years and calls for dramatic changes to Medicare, Medicaid, food stamps, and the tax code. It also repeals most of the 2010 Affordable Care Act (Obamacare), enacts welfare reforms, and rolls back energy and financial sector regulations. The budget resolution is nonbinding and more of a political statement from House Republicans as it will not be considered in the Senate. Senate Democrats opted to not consider a budget resolutions this year as they contend the Balanced Budget Act passed by Congress last December already sets the overall funding level for FY15.

Five alternative budget plans were offered, considered, and, ultimately, defeated. The alternatives included a Democratic version by Budget ranking member Chris Van Hollen (D-MD), President Obama’s FY15 proposal as offered by Rep. Mick Mulvaney (R-SC), and alternative budgets from the Congressional Progressive Caucus, the Congressional Black Caucus, and the Republican Study Committee.

FY2015 Appropriations

The House Appropriations Committee met this week to mark up the FY15 Military Construction-Veterans Affairs (MilCon/VA) and Legislative Branch spending bills. The Appropriations Committees normally consider their 302(b) allocations prior to marking up their 12 annual spending bills in committee. However, House Appropriations Committee Chairman Hal Rogers (R-KY) said this week that his committee does not have the updated Congressional Budget Office baseline information used for scoring the bills that is necessary for providing accurate suballocations for the bills. Rogers anticipates receiving that updated information on April 17. In the meantime, the committee considered interim 302(b) allocations for these first two bills.

The committee approved by voice vote the $165 billion FY15 MilCon/VA appropriations bill, but first adopted a manager’s amendment offered by subcommittee Chairman John Culberson (R-TX) that would insert provisions and make technical changes to the draft committee report. The committee rejected an amendment offered by Rep. Jim Moran (D-VA) that would strike a provision to prohibit military construction funds from being used to construct or alter facilities in the United States with the intent of housing detainees from the detention camp at Guantánamo Bay, Cuba. The bill provides $6.6 billion for military construction (down $3.2 billion from the $9.8 billion enacted in FY14) and $158.2 billion for the VA (up $10.3 billion over FY14 levels). Both parties are hoping the funding levels provided in FY15 will help the VA in its efforts to reduce its backlog of pending claims. The bill also provides $234 million for related and independent agencies, such as cemetery expenses at Arlington National Cemetery.

The committee also approved the $3.3 billion FY15 Legislative Branch spending bill. The funding level is the same as the FY14 funding level, but $122.5 million less than what the President requested. If enacted, the Government Accountability Office (+$14.2M), the Government Printing Office (+$3.2M), and the Library of Congress (+$15.9M) would receive modest increases. The bill contains $1.2 billion to fund the operations of the House – the same as FY14, and continues restrictions on Representatives and Senators from receiving a pay increase in FY15. The Capitol Police would receive $347 million, about $9.5 million more than current spending, but still below their $356 million request.

Chairman Rogers reiterated his goal of completing committee consideration of all 12 annual appropriations bills before the end of June and passing all spending measures before the August recess. In the Senate, Appropriations Chairwoman Barbara A. Mikulski, D-Md., is planning her first markups in May.

As a reminder, the deadlines for members of Congress to submit their programmatic and language requests for the FY15 appropriations process are as follows:

FY15 National Defense Authorization Act

House Armed Services Committee Chairman Buck McKeon (R-CA) and ranking member Adam Smith (D-WA) began the FY15 defense authorization process this week by introducing a “by request bill,” HR 4435. This is the first step in the legislative process for the annual National Defense Authorization Act (NDAA), which authorizes funding for military activities of the Department of Defense, military construction, and defense activities of the Department of Energy, and prescribes military personnel strengths. When the committee meets to mark up the bill later this month/next month, the content of HR 4435 will be struck and replaced with subcommittee and full committee proposals. The markup schedule for the committee is as follows:

Wednesday, April 30, 2014

10:30 AM—Subcommittee on Intelligence, Emerging Threats and Capabilities Markup (Room 2212)

12:00 PM—Subcommittee on Strategic Forces Markup (Room 2118)

1:30 PM—Subcommittee on Seapower and Projection Forces Markup (Room 2212)

3:00 PM—Subcommittee on Military Personnel Markup (Room 2118)

Thursday, May 1, 2014

9:30 AM—Subcommittee on Tactical Air and Land Forces Markup (Room 2118)

10:30 AM—Subcommittee on Readiness Markup (Room 2212)

Wednesday, May 7, 2014

10:00 AM—Full Committee Markup (Room 2118)

Defense Unfunded Priorities Lists

Last week the Pentagon released their FY15 unfunded priorities lists totaling almost $34B. The lists are breakdowns from the Army ($10.603B), Navy ($10.0582B), Marines ($2.5483B), Air Force ($7.991B), Special Operations ($400M), and National Guard ($1.5493B) of their wish lists for additional funds to pay for things like maintenance, shore and afloat readiness, recapitalization, installation support, training and personnel costs, facility modernization, critical spares, and weapons systems modernization. Defense Secretary Hagel said that he was publishing the lists in compliance with orders from Congress, but made it clear that he would not lobby for this additional funding. Copies of the lists can be found at:

Army – https://www.vantagepointstrat.com/?p=162

Navy – https://www.vantagepointstrat.com/?p=163

Marine Corps – https://www.vantagepointstrat.com/?p=164

Air Force – https://www.vantagepointstrat.com/?p=165

Special Operations – https://www.vantagepointstrat.com/?p=166

National Guard – https://www.vantagepointstrat.com/?p=167

Cybersecurity

The Justice Department and the Federal Trade Commission issued a formal policy statement on Thursday saying they won’t file antitrust complaints against companies that share information with each other about cyberattacks on their computer systems. Companies were nervous that antitrust laws intended to prevent stifling competition and inflating prices could be violated when discussing information about cyberattacks. Senate Judiciary Committee Chairman Patrick Leahy (D-VT) and Senate Commerce Committee Chairman Jay Rockefeller (D-WV) applauded the announcement but said that cybersecurity legislation is still needed. The policy statement can be found at: https://www.vantagepointstrat.com/?p=168.

Homeland Security

Rep. Candice Miller (R-MI), Chairwoman of the House Homeland Security Subcommittee on Border and Maritime Security held a hearing this week with the Customs and Border Patrol (CBP) and Immigration and Customs Enforcement (ICE) in advance of committee consideration of two bills introduced earlier this year that reauthorize CBP (HR 3846) and ICE (HR 4279). Both agencies have never received formal authorization from Congress. The intent of the bills is to give the agencies the proper authorities to carry out their missions. Both bills have bipartisan support, as well as support from the two agencies.

Political Updates

Health and Human Services Secretary Kathleen Sebelius resigned this week after leading the agency through the creation and implementation of the Affordable Care Act.  President Obama announced today his intent to nominate OMB director Sylvia Mathews Burwell to replace Sebelius. Sebelius leaves after the Administration announced 7.5 million people enrolled in “Obamacare,” but she was the face for the Administration while they experienced the technical problems with the implementation late last year. Burwell was confirmed as OMB director in a 96 to 0 vote last April. Her nomination to be HHS Secretary has received support from both sides of the aisle, and will be made easier by the Senate’s change to the filibuster rule that now only requires a simple majority vote instead of 60 votes.

Maria Contreras-Sweet was sworn in this week as administrator of the Small Business Administration. Contreras-Sweet was the executive chairwoman and founder of ProAmérica Bank, a commercial bank focusing on small to mid-sized businesses with a specialty in the Latino community.

The Senate Monday confirmed the nomination of Dr. Reggie Brothers to be DHS Undersecretary for Science and Technology (S&T) and retired Air Force Brig. Gen. Frank Taylor to be DHS Undersecretary for Intelligence and Analysis. Brothers is the former Deputy Assistant Secretary of Defense for Research at DoD where he led oversight of DoD’s cyber S&T portfolio. He was also the chair of the DoD S&T Executive Council, which has oversight of the DoD S&T portfolio. Taylor is the former Coordinator for Counterterrorism and Assistant Secretary of State for Diplomatic Security and deputy director for operations in the Directorate of Counterintelligence and Investigative Programs in the Office of the Deputy Undersecretary of Defense for Policy.

The Senate also confirmed Wanda Felton for a second term as First Vice President and Vice Chair of the Export-Import Bank of the United States and Terrell McSweeny to be a Federal Trade Commissioner. McSweeny’s nomination returns the FTC to full-strength for the first time in a year and gives the Democrats a 3-2 edge. McSweeny was a former aide to Vice President Joe Biden. And finally, Neil Kornze was confirmed by the Senate as Director of the Bureau of Land Management. Kornze was a Senior Policy Advisor to Senate Majority Leader Harry Reid (D-NV) from 2003 to 2011.

Next Week

The House and Senate are in recess the next two weeks and will reconvene the week of April 28.

April 4, 2014

The House passed bills providing economic assistance to Ukraine and imposing sanctions against Russia, which were then signed into law by the President. The House also passed HR 2575, the Save American Workers Act, a bill redefining “full-time employee” from 30 hours to 40 hours a week in the 2010 Affordable Care Act (Obamacare). And, later today, the House is expected to pass HR 1874, the Pro-Growth Budgeting Act of 2013, a bill requiring the Congressional Budget Office to use dynamic scoring for major legislation (except appropriations). The Senate passed and the President signed into law a year-long extension of the “doc fix,” a bill to prevent cuts to Medicare payment rates. The Senate also continued debate on a five-month extension to emergency unemployment compensation.

FY2015 Budget

Rep. Paul Ryan (R-WI), Chairman of the House Budget Committee introduced his FY15 budget resolution this week. The resolution proposes to cut $5.1 trillion in spending over 10 years and calls for dramatic changes to Medicare, Medicaid, food stamps, and the tax code. It also repeals most of the 2010 Affordable Care Act (Obamacare), enacts welfare reforms, and rolls back energy and financial sector regulations.

The nonbinding budget resolution, marked up in committee this week, adheres to the $1.014 trillion discretionary budget cap for FY15 that was agreed to in the Bipartisan Budget Act (BBA) passed by Congress last December (P.L. 113-67). While it proposes significant cuts in order to balance the budget within 10 years, defense spending is boosted by $273 billion over the level in the President’s proposed FY15 budget. Although it makes no recommendations for scaling back military pay and benefits, Ryan does say that serious consideration should be given to the recommendations due early next year from the Military Compensation and Retirement Modernization Commission.

During the markup, Democrats offered and requested votes on several amendments that they will use in the upcoming elections to demonstrate the parties’ differing priorities. The defeated amendments include immigration overhaul, raising the minimum wage, and extending unemployment insurance offset by reducing tax subsidies for oil companies and increasing the income tax on millionaires. Democrats also criticize the budget for the use of dynamic scoring, which they assert overstates the economic impact of the proposal.

The budget resolution will be considered on the House floor next week. Passage of the budget resolution in the House may be difficult, as Republicans will need 217 votes. Out of the 233 Republicans in the House, 62 voted against the BBA in December. Ryan’s FY14 budget resolution also passed by a slim margin last year. Senate Budget Committee Chair Patty Murray (D-WA) has said that her committee will not write a budget since the BBA already set the FY15 discretionary spending limit.

FY2015 Appropriations

The House Appropriations Committee officially kicked off the FY15 appropriations process with two subcommittee markups this week – Military Construction/Veterans Affairs and Legislative Branch. These are considered the two least controversial of the 12 annual spending bills. The FY15 DHS appropriations bill may be up next on the docket. These markups were held prior to the committee releasing their 302(b) allocations. It is unclear when those allocations would be made, but they will need to be set before the more controversial spending bills are considered. Chairman Hal Rogers (R-KY) said he aims to have all 12 bills through the full committee by July 4, and he would like to have all 12 pass the House before the August recess. Rogers also called for budget process reform that would move up the April 15 deadline for the House Budget Committee to set discretionary spending levels for appropriators in its annual budget resolution as it would give appropriators more time and a better chance of getting their bills done.

The FY15 Military Construction/Veterans Affairs (MilCon/VA) appropriations bill proposes $71.5 billion in discretionary spending, a decrease of $1.8 billion from FY14 with most of the cuts coming from the MilCon accounts. The bill includes $158.2 billion in both discretionary and mandatory funding for the VA ($10.3 billion over FY14, but $5.7 billion less than the President’s budget request) and $6.6 billion for military construction (compared to $9.8 billion in FY14). Similar to previous years, the bill prohibits any funds from being used to construct facilities in the US for housing Guantánamo Bay detainees. The bill provides $344 million for modernization of the VA’s electronic health record system, but as in the previous year’s spending measure, it would free up only 25 percent of those funds until the VA provides cost estimates for the program as well as status updates on efforts to achieve full interoperability with the Defense Department’s own records. The bill also provides $173 million for the paperless claims processing system and an increase of $20 million above the President’s request for digital scanning of health records, centralized mail, and overtime to end the backlog in disability compensation claims by 2015.

The FY15 Legislative Branch spending bill provides $3.3 billion, which is the same as the FY14 funding level but $122.5 million less than what the President requested. If enacted, the Government Accountability Office (+$14.2M), the Government Printing Office (+$3.2M), and the Library of Congress (+$15.9M) would receive modest increases. The bill contains $1.2 billion to fund the operations of the House – the same as FY14, and continues restrictions on Representatives and Senators from receiving a pay increase in FY15. The Capitol Police would receive $347 million, about $9.5 million more than current spending, but still below their $356 million request.

As a reminder, the deadlines for members of Congress to submit their programmatic and language requests for the FY15 appropriations process are as follows:

Cybersecurity

The Department of Defense (DoD) announced that it officially adopted the IT security standards in the National Institute of Standards and Technology’s (NIST) Risk Management Framework (RMF) in lieu of the military specific DOD Information Assurance Certification and Accreditation Process (DIACAP). DoD will move all IT systems used by its organizational entities to the NIST government-wide set of IT security accreditation standards. DOD released a memo (https://www.vantagepointstrat.com/?p=160) instructing DoD program managers, security personnel, and components on how to implement the new policy.

This is the first time defense and civilian agencies have identical security standards. In addition to all DoD organizational entities, the RMF will apply to weapons, space systems, vehicles, aircraft, and medical devices. The transition timeline calls for ending DIACAP within six months and fully transitioning to RMF within 3 ½ years.

Homeland Security

The House Homeland Security committee Cybersecurity, Infrastructure Protection and Security Technologies subcommittee marked up HR 4007, the Chemical Facility Anti-Terrorism Standards (CFATS) Program Authorization and Accountability Act of 2014. CFATS was originally authorized by Congress in 2007 with the mission of developing a set of vulnerability assessment standards for chemical plants and implementing a corresponding set of regulations to protect the highest risk facilities from intentional physical attacks. CFATS requires covered chemical facilities to prepare security vulnerability assessments and to develop and implement site security plans based on those assessments. Subcommittee chairman Patrick Meehan (R-PA) said that CFATS has struggled in its seven-year history, hence the need for a two year reauthorization bill that would make the site security plan approval process more efficient and the compliance process better coordinated. The bill enjoys bipartisan support as well as the support of the Administration. Meehan worked with Energy and Commerce Committee to resolve jurisdictional referral issues.

Tax Extenders

Sen. Ron Wyden (D-OR), the new chair of the Senate Finance Committee held a mark up this week on a package (EXPIRE Act) that would extend for two years popular business tax preferences such as the credit for research and exploration, individual breaks for mortgage interest and mortgage debt relief, credits for public transit and parking, and biofuel and renewable energy provisions. But only 45 of the 55 breaks that expired Dec. 31 made it into the bill. A description of the Chairman’s modification to the EXPIRE Act can be found at:

http://www.finance.senate.gov/imo/media/doc/Chairman’s%20Modification%20EXPIRE%20Act.pdf

At the markup, Wyden said that this would be the last tax extenders bill the committee takes up as long as he is chairman. “That’s why the bill is called the EXPIRE Act. It is meant to expire.” The committee in a bipartisan voice vote approved the bill. Wyden plans on holding hearings starting next week that focus on reforming the tax code.

Political Updates

House Ways and Means Chairman Rep. Dave Camp (R-MI) announced this week that he would not run for reelection in November. Camp was first elected in 1990. Because of Republican leadership term limits, he is in his last year as chair of the powerful committee whose jurisdiction includes the tax code, Social Security, Medicare, and trade policy. Camp introduced a long-awaited tax-reform package earlier this year that was not embraced by GOP leadership. Camp is the fourth House committee chair to announce his retirement this year. Four Senate committee chairs have also announced their retirements this year. Rep. Paul Ryan (R-WI), Chair of the House Budget Committee, and Rep. Kevin Brady (R-TX) have both indicated an interest in succeeding Camp as Chair of the Ways and Means Committee. Camp’s retirement opens up a potentially competitive district as President Obama narrowly carried the district in 2008.

Rep. Tulsi Gabbard (D-HI), an Iraq Veteran, was named to the House Armed Services Committee filling the seat left open by the resignation of Rep. Rob Andrews (D-NJ). Gabbard, a captain in the Hawaii Army National Guard, said that she would continue to work on bipartisan efforts to reform the military justice system to end the epidemic of military sexual assault.

The Supreme Court ruled 5-4 this week that caps on the total amount of money an individual can give to political campaigns and PACs in an election cycle are unconstitutional violating the First Amendment. Before the ruling, a single donor could contribute up to $5,200 to every House and Senate candidate up to a limit of $48,600. Now, if a single donor gives $5,200 to every House and Senate candidate of one party in a 468-race election cycle, the total would be $2,433,600. Contributions to party committees are capped as well. Before they were limited to $74,600 total. Now, a single donor can give $32,400 to each of the three federal party committees each year and $10,000 to each of the party’s 50 state committees for up to $1,194,400 in donations in a two-year election cycle. And finally, before contributions to Political Action Committees (PACs) were limited to a total of $74,600 in increments of up to $5,000. Post ruling, a single donor can give up to $5,000 to each PAC aligned with his or her political interest. If a donor spent $5,000 on each of the 2757 PACs in the 2012 election cycle, that would equal $13.7 million.

The Senate confirmed Christopher Lu to be Deputy Secretary of Labor. Lu has served as Assistant to the President and Cabinet Secretary for President Obama, and as co-chair of the White House Initiative on Asian Americans and Pacific Islanders. Lu was a classmate of President Obama’s at Harvard Law School and worked for Obama when he was in the Senate.

Next Week

The House will vote on their FY15 budget resolution as well as consider two budget process reform bills – one (HR 1871) would scrap the baseline budget assumption that discretionary spending grows each year with inflation and the other (HR 1872) would account for the costs of market risks in federal credit programs. The Senate will vote on final passage of a five-month extension to emergency unemployment compensation and may begin consideration of S 2198, the Emergency Drought Relief Act of 2014 and S 2199, the Paycheck Fairness Act.

March 28, 2014 

The House and Senate passed different Ukraine aid and Russia sanctions bills, which leaders will have to reconcile before sending them to the President. Both authorize aid to Ukraine and sanction Russia for its takeover of the Crimean peninsula, but the Senate bill contains $100 million for security assistance to central and eastern Europe while the House bill authorizes U.S. international broadcasting to Ukraine and the surrounding region. The House also passed a one-year extension of the “doc fix” and a bill creating new hurdles to presidential designations of national monuments. The Obama administration announced this week that it will extend the March 31 deadline for signing up for health care for people who have begun the process before the deadline but who encounter problems or who have complicated family situations. 

FY2015 Budget

House Budget Committee Chairman Paul Ryan (R-WI) will hold a mark up next week in his committee on an FY15 budget resolution. Ryan’s budget will likely adhere to the $1.014 trillion level agreed to in the Bipartisan Budget Act (BBA) signed into law last December, and may also seek to eliminate the projected deficit by the end of the decade. Republicans have ruled out new tax revenue, so those savings would have to come from spending cuts – either reducing discretionary spending after FY15 or making deeper or faster reductions in entitlement and assistance programs such as Medicare and food stamps. House Majority Leader Eric Cantor (R-VA) said that the budget resolution would be considered on the House floor the week of April 7. Passage of the budget resolution in the House may be difficult, as Republicans will need 217 votes. Out of the 233 Republicans in the House, 62 voted against the BBA in December. Ryan’s FY14 budget resolution also passed by a slim margin last year. Senate Budget Committee Chair Patty Murray (D-WA) has said that her committee will not write a budget since the BBA already set the FY15 discretionary spending limit.

FY2015 Appropriations

House Appropriations Committee Chairman Hal Rogers (R-KY) said that his committee would wrap up their hearings on the FY15 budget and begin mark ups in late April. The Senate is expected to follow a few weeks later with their first committee markup by May 22. The MilCon VA bill could be the first bill the Senate considers in full committee. Senate Majority Leader Harry Reid (D-NV) has set aside four weeks (two in June, two in July) of floor time this summer for the spending bills. While there has been a push to get the 12 spending bills done before the end of the fiscal year (Sept. 30), Republicans who are thinking they may make gains in the Senate in the November elections and Democrats who are up for re-election and want to avoid tough votes may want to put off consideration of the bills until after the election. This is especially true for bills that are typically targets of contentious policy riders or are subjects of disagreement between the parties over the funding levels, such as the Financial Services, Interior-Environment, and Labor-HHS-Education spending bills.

As a reminder, the deadlines for members of Congress to submit their programmatic and language requests for the FY15 appropriations process are as follows:

Cybersecurity

The Senate Homeland Security and Government Affairs Committee held a hearing this week on Strengthening Public-Private Partnerships to Reduce Cyber Risks to Our Nation’s Critical Infrastructure. At the hearing, committee Chairman Tom Carper (D-DE) said that the Administration’s recently released NIST cybersecurity framework is a blueprint or “living document” that will be continually updated; and commended the efforts of those trying to use the framework. However, he said that much more needs to be done and that he continues to believe that bipartisan legislation is the best long-term solution. Carper has been in discussions with Ranking Member Tom Coburn (R-OK) and DHS in an attempt to produce legislation that would do the following:

1. Modernize the way we protect our federal networks from cyber threats. (Federal Information System Management Act (FISMA))
2. Clarify and strengthen the public private partnerships for the homeland security industry to have regarding cybersecurity.
3. Make information sharing easier so that companies can share best practices and threat information with each other and with the federal government.
4. Continue to develop the next generation of cyber professionals.

The primary reason Congress has yet to enact comprehensive cybersecurity legislation is differences over how much liability protection to grant businesses to get them to share cyber threat information with the government. Democrats prefer more targeted liability protection as they contend it would provide sufficient protection to enable businesses to share cyber threat information, and that businesses could potentially exploit broad liability protection for other matters. Proponents of broad liability protection, mainly Republicans, argue that businesses would not feel adequately protected under limited liability, and that their legal counsel would caution them that they could still be subject to legal action.

At the hearing, Sen. McCain (R-AZ) expressed his concerns that when the Senate is considering cybersecurity legislation they will bump up against the same issues they have been addressing in the past. McCain has been advocating for the creation of a select committee to overcome the jurisdictional issues in the Senate.

The SEC hosted a cybersecurity roundtable this week and discussed the cybersecurity landscape and cybersecurity issues faced by exchanges and other key market systems, broker-dealers, investment advisers, transfer agents, and public companies. They also discussed industry and public-private sector coordination efforts relating to assessing and responding to cybersecurity issues. At the roundtable, Commissioner Luis Aguilar recommended that the SEC create a new cybersecurity task force. Larry Zelvin, the head of DHS’ National Cybersecurity and Communications Integration Center, said companies are mostly fearful of disclosing cyber incidents and generally only push information to the government after a problem has persisted for days. The roundtable kicked off a five-week public comment period on the issues discussed at the event.

Homeland Security

The House Homeland Security Subcommittee on Oversight and Management Efficiency marked up H.R. 4228, the DHS Acquisition Accountability and Efficiency Act this week. The bipartisan bill was introduced in the House on March 13 and has been endorsed by the Project Management Institute, the Security Industry Association, the Professional Services Council, and the Business Executives for National Security. The bill gives the agency’s undersecretary for management the power to approve, stop, change, or cancel any major acquisition program, and to review how such purchasing decisions are made. The bill creates an acquisition review board and requires quarterly reviews, multiyear acquisition strategies and congressional notification if the acquisition schedule is changed. Chairman Jeff Duncan (R-SC) said at the hearing, “Although DHS has taken steps to implement an acquisition policy with elements of commercial best practices and has put mechanisms in place to review programs, it has routinely failed to hold programs accountable. This must change.” The full committee is expected to consider and mark up the bill next month.

The panel adopted a few amendments including one that would require every major acquisition program to have a department-approved program baseline before continuing through the acquisitions process, allowing the CIO to provide recommendations to the acquisition review board. They also adopted two amendments offered by Rep. Beto O’Rourke (D-TX). One would require that each program analyze its expected security benefit and how the program or system would be measured. O’Rourke’s second amendment would require program managers to have a life cycle cost estimate and a master schedule for the program’s implementation.

Political Updates

Rep. Mike Rogers (R-MI) announced this morning that he is not seeking re-election to Congress, ending a 14-year career in Washington. Rogers is the chairman of the House Intelligence Committee. Post retirement, Rogers will join Cumulus, a talk radio company. While Rep. Mac Thornberry (R-TX) is next in line on the committee in seniority, he is considered the frontrunner to take over as chairman of the House Armed Services Committee (HASC) next year. If Thornberry becomes HASC chairman, Rep. Jeff Miller (R-FL) would be the frontrunner to take the Intelligence gavel. Miller is currently chairman of the House Veterans Affairs Committee. Rep. Devin Nunes (R-CA) and Rep. Peter King (R-NY) have both expressed interest in the position. Rep. Dutch Ruppersberger (D-MD), the ranking Democrat on the committee may also be leaving the committee at the end of the year because his term on the panel ends. Mr. Ruppersberger said whether he can stay past this term is up to House Minority Leader Nancy Pelosi (D-CA).

Secretary of Defense Chuck Hagel announced several Department of Defense Senior Executive Service appointments and reassignments this week:

• Navy Rear Admiral Margaret “Peg” Klein, Senior Advisor for Military Professionalism, reporting directly to Sec. Hagel on issues related to military ethics, character, and leadership
  James P. Woolsey president, Defense Acquisition University, Office of the Under Secretary of Defense (Acquisition, Technology and Logistics)
• Thomas M. Brady, director, Department of Defense Education Activity, Office of the Under Secretary of Defense (Personnel and Readiness
• Guy C. Beougher, executive director, operations and sustainment, Defense Logistics Agency
• Iram A. Ali, special assistant to the secretary of defense for White House Liaison

Next Week

In addition to a few bills on the suspension calendar and completing action on the Ukraine aid measure, the House will consider HR 2575, the Save the American Workers Act of 2014, a bill amending the Internal Revenue Code to redefine “full-time employee” from 30 hours to 40 hours a week, for purposes of the mandate requiring employers to provide health care coverage for their employees. The House will also consider HR 1874, the Pro-Growth Budgeting Act of 2013, a bill requiring the Congressional Budget Office to prepare a macroeconomic impact analysis for each major bill or resolution reported by any congressional committee (except appropriations). The Senate will complete work on the “doc fix” bill and continue debate on an extension to unemployment benefits.

March 14, 2014

The House passed a bill requiring the Attorney General to report to Congress when federal officers refrain from enforcing laws as well as a bill authorizing Congress to pursue civil action against the Executive Branch for not executing laws. The House also passed the Water Rights Protection Act, a resolution expressing support for the people of Ukraine, and a bill providing a long-term fix for Medicare’s physicians’ pay problem offset by a five-year delay of the Affordable Care Act’s individual mandate. While the current “doc fix” expires on March 31, the Senate is unlikely to agree to the House bill because of the offset. A short-term extension might be needed. The Senate passed Sen. McCaskill’s (D-MO) sexual assault prevention in the military bill and a bill reauthorizing the Child Care and Development Block Grant Act. The Senate also passed the Homeowner Flood Insurance Affordability Act (HR 3370), which now goes to the President for his signature.

FY2015 Budget

The White House released part two of its $1.014 trillion FY15 budget request on Monday, which included the budget’s historical tables and analytical perspectives. Administration officials were on the Hill this week testifying and defending the President’s FY15 budget request.

OMB released two sequestration reports this week. While the Balanced Budget Act (PL 113-67) Congress passed in December averted sequestration in FY15 for discretionary funding, the sequester will still cut almost $18B from mandatory spending programs. These reports outline what those mandatory cuts will look like for each non-exempt budget account with direct spending. The Budget Control Act (PL 112-25) calls for sequestration of almost $18B in defense and non-defense direct spending in FY15. The reports can be found at:

https://www.vantagepointstrat.com/wp-content/uploads/2014/03/sequestration_order_report_march2014.pdf

https://www.vantagepointstrat.com/wp-content/uploads/2014/03/sequestration_preview_report_march2014.pdf

FY15 Appropriations

House and Senate Appropriations Chairs, Rep. Hal Rogers (R-KY) and Sen. Barbara Mikulski (D-MD) have set aggressive timetables for marking up their FY15 appropriations bills this year. They would like to have them enacted into law by Oct. 1. Both will begin marking up their bills in subcommittee in May, with floor action for some bills starting in June. The order of consideration has not been decided.

Mikulski said this week that the Transportation HUD bill will likely be among the first ones her panel marks up. Defense may be considered later or last in the Senate as appropriators have not received the Administration’s FY15 Overseas Contingency Operations (OCO) budget request. The budget included a $79.4 billion placeholder for OCO until DOD can better determine the scope of the enduring US presence in Afghanistan. During several hearings this week, Pentagon officials were asked when they could expect the FY15 OCO budget. DOD Comptroller Robert Hale responded that they wouldn’t be able to finalize the budget details until the bilateral security agreement is complete. This is not likely until after the elections on April 5. The Administration is expecting the next president of Afghanistan to sign the agreement. If there is no winner in April, a runoff would be held in August.

In the House, the Legislative Branch and MilCon/VA may be considered first, and Labor HHS Education likely would go last. While it has been reported that Rogers and Mikulski may pre-negotiate the subcommittee FY15 allocations, otherwise known as 302(b)s, that decision has not yet been made.

As a reminder, the deadlines for members of Congress to submit their programmatic and language requests for the FY15 appropriations process are as follows:

Cybersecurity

DHS named a new leadership team in the National Protection and Programs Directorate’s Office of Cybersecurity and Communications:

• Andy Ozment

Assistant Secretary for Cybersecurity and Communications

In addition to his recent role as Senior Director for Cybersecurity at the White House, Ozment has previously served in operational and policy roles at both DHS and the DoD.

• Air Force Brigadier General Gregory J. Touhill

Deputy Assistant Secretary for Cybersecurity Operations and Programs

Touhill will focus on the development and implementation of operational programs designed to protect government networks and the critical systems that run power plants and utilities.

• Bobbie Stempfley

Deputy Assistant Secretary for Cybersecurity Strategy and Emergency Communications

Stempfly will oversee emergency communications, developing and implementing strategy and policy efforts, as well as focusing on building on our partnerships with the public and private sectors, and the general public.

Homeland Security

The House Homeland Security Subcommittee on Oversight and Management Efficiency Chair Rep. Jeff Duncan (R-SC) introduced legislation this week to reform DHS’ acquisition management. Reps. Ron Barber (D-AZ) and Steve Daines (R-MT) were cosponsors of the bill, H.R. 4228, the DHS Acquisition, Accountability and Efficiency Act. The bill requires greater oversight of DHS’ purchasing process and reforms DHS’ acquisition process by:

• Authorizing the Department’s Chief Acquisition Officer, the Undersecretary for Management, to approve, halt, modify or cancel major acquisition programs as needed;
• Requiring that every major acquisition program have an approved Acquisition Program Baseline (APB) document;
• Codifying the Acquisition Review Board and requiring the board to validate the documents – including the APB – and review the cost, schedule and performance objectives of major acquisitions;
• Requiring a Multiyear Acquisition Strategy be included in each Future Years Homeland Security Program;
• Authorizing the Chief Procurement Officer to serve as the main liaison to industry and to oversee a certification and training program for DHS’s acquisition workforce;
• Compelling DHS to submit to Congress major acquisition programs that fail to meet cost, schedule or performance metrics through quarterly status and accountability reports;
• Directing the Department to find ways to streamline the acquisition process and strategically address issues regarding bid protest without creating any new offices or programs; and
• Instructing DHS to eliminate unnecessary duplication.

A copy of the bill can be found at:

https://www.vantagepointstrat.com/wp-content/uploads/2014/03/031314-HR4228.pdf

Political Updates

Republican David Jolly defeated Democrat Alex Sink in the special election for Florida’s 13th District. Jolly was sworn in on Thursday and succeeds Rep. Bill Young (R-FL), who passed away in October. The district is a true swing district that was won by President Obama in 2012. Jolly won the race 48.5% to 46.6% running as an opponent to Obamacare while Sink promised to work across the aisle bringing Democrats and Republicans together. This was an opportunity for both parties to test out their attack lines for the November election. Jolly will have to run for re-election in November.

Next Week

The House and Senate are in recess next week. The Senate will resume consideration of a bill to provide aide to Ukraine when they return the week of March 24. They will also take up an emergency unemployment compensation extension bill, “doc fix” legislation, and nominations.