March 6, 2015

The House passed the Senate’s clean (no immigration riders) FY15 Department of Homeland Security (DHS) appropriations bill funding the agency through the end of the fiscal year. The bill then went to the President who signed it on Wednesday. The House also passed HR 294, the Long-Term Care Veterans Choice Act and HR 749, the Passenger Rail Reform and Investment Act of 2015. The Senate held an override vote on President Obama’s veto of legislation approving the Keystone XL oil pipeline. The vote was 62 to 37, short of the 2/3 needed, so the President’s veto was sustained. Eight Democrats voted in favor of the override – Sens. Bennet (CO), Carper (DE), Casey (PA), Heitkamp (ND), Manchin (WV), McCaskill (MO), Tester (MT), and Warner (VA). The Senate also cleared a joint resolution (SJ Res 8) providing for congressional disapproval of a rule submitted by the National Labor Relations Board relating to union representation election procedures.

FY15 DHS Appropriations

Funding for the Department of Homeland Security (DHS) was set to expire at midnight on March 6, but the House passed the Senate’s clean FY15 DHS appropriations bill by a vote of 257 to 167 before the deadline. The entire House Democratic caucus (182 members) was joined by 75 Republicans to pass the bill, including House Speaker John Boehner (R-OH) and other House GOP leaders. Earlier in the week, the Senate rejected the House’s request to go to conference on the FY15 DHS appropriations by a vote of 47 to 43, short of the 60 votes needed to advance.

FY16 Budget

Congress can now turn their attention to the FY16 budget and appropriations process. But even that is starting off with much disagreement. The Budget Control Act of 2011 (BCA) calls for post-sequestration FY16 funding level caps of $523.067B for defense activities and $492.987B for non-defense activities. The President submitted his FY16 budget to Congress on February 2 in which he requested $561B for defense and $530B for non-defense. The President’s budget also includes a separate request of $50.9B for the Overseas Contingency Operations (OCO) account.

While House and Senate Budget Committees are moving forward with plans to mark up their FY16 budget resolutions (potentially the week of March 16), there isn’t consensus among Republicans on whether or not to undo the sequestration caps. Defense hawks are pushing for an increase above BCA caps for defense spending while fiscal hawks want to keep the defense budget in line with BCA caps.

Earlier this month House Armed Services Committee (HASC) Republicans sent a letter to House Budget Committee Chairman Tom Price (R-GA) recommending a restoration to the pre-sequestration BCA caps of $577B for national defense and $50.9B for the OCO account for FY2016. And, if that is not feasible, the Republican HASC committee members recommended, at a minimum, last year’s House-passed Budget Resolution level of $566B for national defense for FY16 with restoration to pre-sequestration level funding in FY17. Seventy House members also signed a letter calling for at least that $566B for national defense.

On the Senate side, Senate Armed Services Committee (SASC) Chairman John McCain (R-AZ) has vowed to personally oppose a budget resolution that doesn’t increase military spending above what’s allowed under the BCA. McCain says that he has been talking with Senate Budget Committee Chairman Mike Enzi (R-WY) and working with SASC members to present a unified argument to the Budget Committee.

However, any changes to the sequestration caps may come too late for the FY16 appropriations process as they will begin to mark up their bills in the House in May and in the Senate in June. In the House Appropriations Committee, Defense Appropriations Subcommittee Chairman Rodney Frelinghuysen (R-NJ) has said that he expects that they will have to adhere to BCA sequestration caps and has asked the military services to draw up plans for abiding by the caps.

Once Congress has a budget resolution, they then have to figure out a patch to avoid scheduled cuts to Medicare physician payments (April 1), how to replenish the Highway Trust Fund (May 31), raise the debt limit (October/November), and clear all FY16 appropriations bills (October 1).

FY16 Appropriations Subcommittee Deadlines

The House and Senate Appropriations subcommittees have set their deadlines for receiving members’ programmatic and language submissions for consideration in the FY16 appropriations process. Keep in mind that each member’s personal office will have earlier deadlines for submitting requests in order to give their staff and members time to consider each proposal before submitting to the appropriations subcommittees.

Cybersecurity

House and Senate leaders want to consider cybersecurity legislation before taking up reauthorization of the USA Patriot Act provisions, which expire June 1.

Senate Intelligence Committee Chairman Richard Burr (R-NC) released a draft Cybersecurity Information Sharing Act (CISA) of 2015 two weeks ago. His new CISA bill is a lot like the previous CISA bill including provisions on information sharing; authorizations for preventing, detecting, analyzing, and mitigating cybersecurity threats; sharing of cyber threat indicators and countermeasures with the federal government; and liability protections. The bill also includes tougher requirements on companies to remove personally identifiable information. Burr wants to mark up the bill as soon as possible, perhaps as early as next week. And once the bill is marked up in committee, Senate leadership is eager to bring it to the floor quickly. But passage is not assured as many of the groups who opposed it last time find this new draft more objectionable.

On the House side, the Homeland Security Committee is working on its own version of a cybersecurity information-sharing bill that staff hopes to have ready to go by the end of the month. Given committee jurisdiction issues, Chairman McCaul’s (R-TX) bill may just focus on promoting cybersecurity information-sharing with a DHS portal. Committee staff have been meeting with industry to solicit their input prior to introducing and marking up legislation. The House Intelligence Committee is also working on a cybersecurity bill that would address threat indicator sharing with DHS while also providing legal protection for companies sharing with a broader array of federal entities including law enforcement.

And Department of Defense Under Secretary of Defense for Acquisition, Technology and Logistics Frank Kendall said this week that he plans to add a special section on cybersecurity requirements to the next phase of the Better Buying Power, the Pentagon’s guidelines for buying weapons.

White House Consumer Privacy Bill of Rights Act

The White House quietly released a Consumer Privacy Bill of Rights Act last Friday. The bill would require companies to provide clear notice of how they use personally identifiable information, ensure data isn’t reused in other contexts, and give consumers a method to have their data deleted.

The bill also grants the Federal Trade Commission (FTC) more authority to fine companies for missteps, and encourages industries to craft their own standards or codes of conduct for the FTC to enforce. It is unclear who will sponsor the bill in Congress, as it is not getting any support from the tech and advertising industries and is generating some discontent from privacy advocates as they fear it would weaken digital privacy.

The administration’s bill can be found at:

http://www.whitehouse.gov/sites/default/files/omb/legislative/letters/cpbr-act-of-2015-discussion-draft.pdf

Political Updates

Senator Barbara Mikulski (D-MD) announced this week that she is not seeking re-election for a sixth term in 2016. Mikulski is the first woman senator from Maryland, first woman to chair the Senate Appropriations Committee, and the longest serving woman in the history of the US Congress. Maryland Democratic Rep. Chris Van Hollen said Wednesday he will run to succeed retiring Sen. Barbara Mikulski. Van Hollen is the first official entrant in a race that could ultimately include other members of the congressional delegation, including Reps. Donna Edwards, John Sarbanes and John Delaney, as well as former Lt. Govs. Anthony Brown and Kathleen Kennedy Townsend, Baltimore Mayor Stephanie Rawlings-Blake, and former state Del. Heather Mizeur. Kathleen Matthews, Marriott International’s Executive Vice President and Chief Global Communications and Public Affairs Officer may be considering running for the seat being vacated by Rep. Van Hollen as he seeks Sen. Mikulski’s Senate seat. Matthews was an anchor for WJLA and is the wife of MSNBC’s Chris Matthews.

Rep. Candice Miller (R-MI) announced her decision to retire at the end of the 114th Congress. Miller serves as Chairman of the Committee on House Administration – currently serving as the only woman chair of a committee in the US House of Representatives. She serves as Vice Chair of the House Committee on Homeland Security, as well as Chairman of the Homeland Security Subcommittee on Border and Maritime Security, and is a member of the Committee on Transportation and Infrastructure.

The Department of Energy chose Michael Johnson as its next Chief Information Officer (CIO). Johnson is currently the assistant director for intelligence programs at the Office of Science and Technology Policy (OSTP). He will replace Energy’s interim CIO, Don Adcock who stepped into the position in an acting capacity last September when CIO Bob Brese left the department. At OSTP, Johnson handled a range of national security issues across intelligence, homeland security, and cybersecurity as well as information sharing.

Vice President Biden announced the appointment of Caroline Bettinger-López as the new White House Advisor on Violence Against Women, the second person to serve in this new position created under the Obama administration to advise the President and Vice President on domestic violence and sexual assault issues. Bettinger-López replaces Lynn Rosenthal, who left earlier this year to become the Vice President of Strategic Partnerships at the National Domestic Violence Hotline.

President Obama has nominated Peter Levine to be the Pentagon’s Deputy Chief Management Officer. Levine was the Senate Armed Services Committee Staff Director under former Senator Carl Levin (D-MI). The President also nominated John Conger to be the Principal Deputy Undersecretary in the DOD Comptroller’s Office. Conger is currently the Assistant Deputy Undersecretary for Installations and Management.

Alissa Johnson, former Deputy Chief Information Officer of the White House executive office, is joining medical device and equipment manufacturer Stryker as the company’s chief information security officer.

State Department Chief of Staff David Wade is stepping down and will be succeeded by Jon Finer who is currently the Deputy Chief of Staff at State.

Next Week

The House is in recess next week. The House may take up HR 1029, the EPA Science Advisory Reform Act of 2015 and HR 1030, the Secret Science Reform Act of 2015 when it returns the week of March 16. The White House has threatened to veto both of these bills. The Senate is in session next week and will take up S625, the Iran Nuclear Agreement Review Act of 2015, a bill that would require congressional review of any agreement the administration negotiates with Iran on its nuclear program. Senate Democrats are expected to filibuster the measure saying that they won’t vote for a bill about congressional approval of a potential Iran nuclear deal until after the key March 24 negotiation date has passed. The Senate is also expected to consider HR 749, a bill that would reauthorize Amtrak that was passed by the House this week. And the Congressional Budget Office will release its updated 10-year projection of spending, revenue, and deficits on Monday, March 9.

January 10, 2014

Week in Review

House

The House passed the Reducing Excessive Deadline Obligations Act of 2013, a bill to give states the ability to assign priority to Superfund cleanups managed by federal laws, impose state and local laws on federal cleanup projects, and block the Environmental Protection Agency from issuing regulations for hazardous waste disposal in states where similar regulations already exist. The House also passed the Health Exchange Security and Transparency Act of 2014,a bill requiring the Health and Human Services Secretary to notify individuals whose privacy is compromised in a data breach.

Senate

The Senate confirmed Janet Yellen as Chairwoman of the Board of Governors of the Federal Reserve and began consideration of a bill to extend federal unemployment insurance benefits.

FY2014 Appropriations

House and Senate Appropriators continue to work to reach agreement on the FY14 appropriations omnibus bill. Latest reports are that they have agreement on six of the 12 bills (Agriculture, CJS, Defense, Legislative Branch, MilCon/VA, and Transportation HUD) and are close to agreement on two others (Energy & Water and Homeland Security). Discussions on the remaining four bills (Financial Services, Interior & Environment, Labor HHS Education, and State/Foreign Ops) appear to be slowed by divisive policy riders such as implementation of Obamacare, the Dodd-Frank financial overhaul, abortion policy, and the EPA’s carbon emission regulations.

While the appropriators’ goal was to reach agreement on all bills by today, they are running out of time to pass a final omnibus and get it signed into law before the current continuing resolution (CR) expires on Jan. 15. House Appropriations Chairman Hal Rogers (R-KY) introduced a short-term CR today funding the government through Saturday Jan. 18 allowing them a few extra days to complete work on the omnibus and avert a shut down. Both the House and the Senate are in recess the week of Jan. 20 so there will be pressure on both sides to complete their work by the end of next week.

FY2015 Budget

The President is required by statute to submit his federal budget request to Congress on the first Monday in February (Feb. 3 this year). However, the Office of Management and Budget (OMB) is reportedly waiting for the FY14 appropriations omnibus bill before completing its FY15 budget formulation process. OMB has not yet sent its decisions on agency FY15 budget proposals back to the agencies for their review (known as “passback”). Passback is normally completed in late November. After passback, it usually takes the Administration four to five weeks to finish the budget process and send it to Congress. Given that passback has not yet occurred, the Administration will likely miss the deadline of the first Monday in February.  OMB may submit its FY15 budget to Congress sometime in late February or early March. Last year President Obama didn’t deliver his FY14 budget to Congress until April as the budget process was delayed by the fiscal cliff negotiations in January of that year.

The latest budget agreement passed by Congress in December included a $1.014 trillion top-line discretionary funding limit for FY15. Even with this top line funding level, Republicans on the Senate Budget Committee are pressing for Senate Budget Committee Chair Patty Murray (D-WA) and democrats on the committee to write an FY15 budget resolution as they contend that the budget resolution includes more than just the top-line number. Murray has not decided if she will write an FY15 budget resolution. House Budget Committee Chairman Paul Ryan (R-WI) has indicated that his committee will write and mark up an FY15 budget resolution this spring.

Political Updates

Rep. Jim Gerlach (R-PA) announced his retirement earlier this week. Gerlach, a six-term moderate Republican and member of the Ways and Means Committee is the ninth House Republican to announce they will not seek re-election in 2014. Democratic Reps. Mike McIntyre (D-NC) and Carolyn McCarthy (D-NY) are also retiring. McIntyre is the third most senior democrat on the Armed Services Committee and second on the Agriculture Committee. His district will be a competitive race in 2014. McCarthy announced in June that she was undergoing treatment for lung cancer. She holds seats on the Education and Financial Services committees. Her seat is not expected to be competitive.

Rep. Melvin Watt (D-NC) officially resigned from the House of Representatives this week having been sworn in as Director of the Federal Housing Finance Agency (FHFA). There are now 433 members in the House.

Rep. Bradley Byrne (R-AL), the newly elected member from Alabama’s 1^st congressional district was sworn in on Wednesday and assigned to the House Armed Services Committee. Byrne fills the seat vacated by former Rep. Jo Bonner, who retired in August to work for the University of Alabama.

Sen. Tom Coburn (R-OK) said this week that he may need to resign early as he has been undergoing chemotherapy to treat recurrent prostate cancer. Coburn has already said that he wouldn’t run for re-election in 2016. He’ll make his resignation decision after he receives test results in February.

The Senate confirmed Janet Yellen as Chairwoman of the Board of Governors of the Federal Reserve by a vote of 56 to 26. Yellen replaces Ben Bernanke beginning Feb. 1. The White House announced today its intentions to nominate Stanley Fischer, the former head of Israel’s central bank, to serve as vice chairman of the Federal Reserve and Lael Brainard, the former Treasury undersecretary for international affairs, to the Fed board. The president will also nominate current Fed Governor Jerome Powell to serve a full term.

Next Week in Congress

Both the House and Senate will take up a CR and the FY14 appropriations omnibus. The Senate will also resume consideration of a bill to extend federal unemployment insurance benefits.