This Week on the Hill
The House and Senate are both in this week, with much of the week focused on appropriations and a potential Zika response package.
The Senate returns today and will resume consideration of H.R. 2578, the legislative vehicle for the Commerce-Justice-Science spending bill, with cloture votes scheduled on four gun-control amendments, two from Democrats and two from Republicans. The chamber plans to spend much of the remainder of the week on the appropriations bill. Several committees have scheduled hearings this week: the Commerce, Science and Transportation Committee will hold a hearing Tuesday on FirstNet, including an update on the Public Safety Broadband Network; the Energy and Natural Resources Committee will hold a hearing Thursday on a wildfire budgeting bill; and the Special Committee on Aging will hold a hearing Thursday on care for individuals with serious illness.
The House returns Tuesday and will consider 22 bills under suspension of the rules (eight of which rename federal buildings and post offices), including H.R. 5525 to prohibit subsidies for mobile and data services under the Lifeline program to low-income individuals and H.R. 5170 that provides for social impact partnership projects with state and local governments that are directed at teenagers and young adults. For Wednesday and the balance of the week, the House will consider the fiscal year 2017 Financial Services spending bill (H.R. 5485) and could consider a Zika response package if completed in time by conference members (see more below). Several committees have scheduled hearings: the Agriculture Committee will hold a hearing Wednesday on the Supplemental Nutrition Assistance Program (SNAP); the Education and Workforce Committee will hold a hearing Thursday on implementing the Every Student Succeeds Act; and the Energy and Commerce Committee will hold a hearing Wednesday on the renewable fuel standard.
The President will sign into law the bill updating the Toxic Substances Control Act of 1976 (H.R. 2576) on Wednesday, which had bipartisan support in the House and Senate.
Fiscal Year 2017 Budget Update
The House passed the Defense spending bill on the floor last week by a vote of 282-138 and drew a veto threat from the administration. The $575.7 billion bill includes $517.1 billion in base funding (a $3 billion increase over fiscal year 2016) and $58.7 billion in the Overseas Contingency Operations account; however, $15.7 billion from the contingency funds would be used to pay for base budget items. Several measures were also added to the bill to prevent the closure of the prison at Guantanamo Bay. The House Appropriations Committee passed the Interior-Environment spending bill by a vote of 31-18. The $32.1 billion bill reduces spending by $64 million compared to fiscal year 2016 and is $1 billion below the President’s request. Democratic amendments to add funding for Zika response and water systems in Flint, Michigan failed while provisions related to offshore drilling air pollution regulations and endangered species were approved.
The Senate Appropriations Committee approved two spending bills last week, the Interior-Environment bill and the Financial Services bill. The $32 billion Interior-Environment bill (summaries here and here) represents a decrease of $125 million compared to fiscal year 2016, and is $1.1 billion less than the President’s request. The bill cuts the budget of the Environmental Protection Agency by $31.2 million, while including a policy rider that blocks implementation of the Waters of the U.S. rule. An amendment was approved providing $661 million in emergency wildfire funding. The committee also approved the Financial Services bill (summaries here and here), which provides $22.4 billion in fiscal year 2017, a decrease of $1 billion from fiscal year 2016. Unlike the House version, this bill holds funding for the Internal Revenue Service at fiscal year 2016 enacted levels and includes an amendment that lifts the travel ban to Cuba. This is the eleventh of the twelve spending bills approved by the Senate Appropriations Committee, leaving only the Senate-Foreign Operations bill. The Senate began floor consideration of the $56.3 billion Commerce-Justice-Science spending bill last week, but after a 14-hour filibuster from Senate Democrats over gun control amendments, consideration of the bill will resume today. That bill has also drawn a veto threat from the administration.
This week the House is scheduled to consider the $21.7 billion Financial Services bill on the floor, while the Appropriations Committee will markup the $41.1 billion Homeland Security bill (this was delayed from last week) and the State and Foreign Operations Subcommittee will markup their bill.
Congress Announces Bipartisan Child Welfare Financing Legislation
Last week the House Ways and Means Committee introduced the Family First Prevention Services Act (H.R. 5456), intended to strengthen families and reduce inappropriate foster care placements; the Senate Judiciary Committee will introduce companion language. Key provisions of the bill include: giving states flexibility to use federal foster care dollars to provide upfront, evidence-based prevention services; ensuring more foster children are placed with families; reauthorizing the Regional Partnership Grant program aimed at preventing child abuse and child neglect due to parental substance abuse; reducing the amount of time foster children wait to be adopted or placed with relatives; and supporting family members who unexpectedly assume responsibility for a child. A summary of the bill can be found here and draft bill text can be found here. The House has scheduled a floor vote on the bill for Tuesday.
Supreme Court Rejects Appeal from States on Mercury Rule
The Supreme Court last week did not take up an appeal from 20 states to block rules from the Environmental Protection Agency (EPA) that limit mercury emissions, leaving in place a lower-court ruling that found the regulations could stay in effect while the EPA revised compliance costs. The focus of the ruling was the Mercury and Air Toxic Standards rule, which was opposed by many states who felt the compliance costs greatly outweighed the health benefits of the rule. The EPA released an updated analysis of the estimated costs and benefits in April; it found annual compliance costs are projected to be $9.6 billion, and health benefits are projected to be between $37 billion and $90 billion. Also, the federal 6th Court of Appeals announced that it would not hear oral arguments on the Waters of the United States rule until February 2017; this rule clarifies what bodies of water fall under federal jurisdiction for purposes of the Clean Water Act.
House and Senate Begin Zika Negotiations as CDC Releases Draft Response Plan
On Wednesday negotiators from the House and Senate met for the first formal meeting of the conference to craft a Zika virus response plan. Members are working to produce a final package by July 1, as the House and Senate are scheduled to leave town July 15 for a seven-week recess. Last month the Senate approved $1.1 billion in emergency spending as part of a larger appropriations package (H.R. 2577) while the House approved $622 million in funds through fiscal year 2016, fully offset with reductions to other programs (H.R. 5243). Meanwhile, the Centers for Disease Control and Prevention (CDC) released a draft interim Zika response plan last week. The purpose of the plan is to describe the agency’s response plan for the first locally acquired case of Zika in the continental United States and Hawaii. The plan underlines CDC’s support of state and local efforts to prepare and respond to the Zika virus, covering areas such as preparedness, surveillance, planning, testing and communication.
Mental Health Legislation Passes House Committee
The House Energy and Commerce Committee passed bipartisan legislation by a vote of 53-0 on Wednesday aimed at reforming mental health care. Highlights of the legislation, the Helping Families in Mental Health Crisis Act (H.R. 2646), include the following: codifies a recently-finalized regulation that allows for Medicaid payments under certain circumstances for adults receiving treatment in an institution for mental diseases, but only for adults staying no longer than 15 days; directs states to require the use of an electronic visit verification system for Medicaid-provided personal care services and home health providers, starting January 1, 2019, and imposes a modest, incremental reduction in federal matching percentage on states that do not comply; and directs the Department of Health and Human Services to develop a regulation to clarify when disclosure of protected health information is permitted for a patient with mental illness. An Amendment in the Nature of a Substitute was adopted for the bill, and a section by section summary of the amendment can be found here, while other committee documents can be found here.
House and Senate Expected to Begin Opioid Conference Soon
On Thursday the Senate voted 95-1 to set up a conference committee with the House to reconcile differences between bills passed by each chamber addressing the opioid abuse crisis. The Senate designated eight conferees, while the House named 34 lawmakers to the conference committee last month. In addition to naming conferees, the Senate also adopted a nonbinding motion by a vote of 66-29 that instructs the conferees to insist that the final conference report includes funding to support state and local efforts for the prevention and treatment of opioid abuse. A nonbinding motion also passed by a vote of 70-24 instructing conferees to include authorizations for prescription drug monitoring programs, addressing the needs of rural communities, and including provisions of a separate bill (S. 1455) that would raise the federal limit that restricts doctors from prescribing more than 100 patients with buprenorphine, a medication-assisted treatment for opioid addiction. The Senate passed its bill, S. 524 in March while the House passed its amended version in May.
Administration Announces Grants to Help States Review Proposed Premium Increases
On Wednesday the Centers for Medicare and Medicaid Services (CMS) announced the availability of $22 million in funding to state insurance regulators to use for issuer compliance with Affordable Care Act consumer protections. States will be able to seek funding for activities related to essential health benefits, preventive services, parity in mental health and substance abuse benefits, and bringing down the cost of coverage, including through premium rate reviews. The funding is part of the $250 million in state rate review grants the act provided to improve the process for how states review proposed health insurance rate increases. According to the release, in 2015 rate reviews led to an estimated $1.5 billion in savings for consumers.
EPA Proposes Clean Energy Incentive Program
The Environmental Protection Agency (EPA) released its proposed rule for the Clean Energy Incentive Program (CEIP) last week, which was created as part of the Clean Power Plan. This voluntary program is intended to assist states that wish to incentivize certain early emission reduction projects under the Clean Power Plan, prior to the start of the performance period in 2022 (the Clean Power Plan is currently subject to a court-ordered stay, and the 2022 deadline may change). The voluntary program was designed to help states and tribes with affected sources of pollution meet their goals under the plan by removing barriers to investment in energy efficiency and solar measures in low-income communities and by encouraging early investments in zero-emitting renewable energy. A fact sheet on the CEIP can be found here.
Recently Released Reports
Second Report to Congress: Medicaid Incentives for Prevention of Chronic Diseases Evaluation, U.S. Department of Health and Human Services
Unemployment Insurance: States' Customer Service Challenges and DOL's Related Assistance, U.S. Government Accountability Office
How Prevalent is Campus Sexual Assault in the United States?, National Institute of Justice
The Funding of State and Local Pensions: 2015-2020, Center for State and Local Government Excellence
Understanding Medicaid Hospital Payments and the Impact of Recent Policy Changes, The Kaiser Commission on Medicaid and the Uninsured
Economic News
Real GDP Increased in 41 States in the Fourth Quarter of 2015
New data released by the U.S. Department of Commerce shows that real gross domestic product (GDP) increased in 41 states and the District of Columbia in the fourth quarter of 2015. Overall, real GDP by state growth ranged from 3.0 percent to -3.4 percent across specific states. Sectors that grew the fastest in the fourth quarter include information (10.6 percent), construction (7.6 percent), and professional, scientific, and technical services (3.9 percent). Mining declined 10.7 percent in the fourth quarter, subtracting more than 2.2 percentage points from real GDP in many energy dependent states.
Fed Declines to Raise Interest Rates After Latest Meeting
After a meeting of the Federal Open Market Committee last week, the Federal Reserve released a statement indicating a unanimous vote to maintain the target rate for the federal funds rate at 1/4 to 1/2 percent. The statement highlighted positive indicators such as growth in economic activity, a declining unemployment rate, an improving housing sector, and lessened drag from net exports. Negative contributions include a slowed pace of improvement in the labor market, diminished job gains and soft business fixed investment. However, the Committee currently expects that with gradual adjustments in the stance of monetary policy, economic activity will expand at a moderate pace and labor market indicators will strengthen. The next chances for adjustments are in meetings scheduled for July and September.