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House Considering Two-Week Spending Extension

The House is currently debating a measure to keep the federal government open for another two weeks. The current short-term package expires after tomorrow and another extension is needed by then to prevent large parts of the government from shutting down. The two-week extension, through December 22, would buy negotiators additional time to reach an agreement on a final funding package for FY2018, which started October 1.

A number of issues remain unresolved with respect to FY2018 spending, such as: the lack of an agreement on the overall amount of funding that will be available for the fiscal year; whether another short-term extension will be needed after the 22nd; the lack of an agreement on how much, or whether, to spend more on both domestic and defense discretionary programs; and, whether an increase in spending would only be for defense program.

Another Short-term Funding Measure Unveiled

On Saturday, the House leadership unveiled a short-term spending bill that would keep the government funded through December 22. Because none of the 12 annual spending bills have been signed into law for FY2018, which started October 1, a continuing resolution (CR) was needed to keep the government open at current levels until negotiations over funding could be completed. The current CR expires at midnight, December 9.  The new CR is designed to allow negotiators to make further progress on FY2018.  Several Congressional leaders are acknowledging that another CR, beyond the one that would run through the 22nd, will likely be needed.

At this point, there is no agreement on how much money overall is even available for the federal budget in FY2018, making decisions on the size of each individual bill even more difficult to reach.  Without a compromise on a total spending level for FY2018 that would increase the current budget caps in place, both defense and non-defense programs would see cuts below the FY2017 levels.

Republicans will need help from Democrats to pass this short-term CR but it is far from assured that the Democrats will support it.

Congress Returns to Face a Full Plate

Both chambers of Congress return to DC this week after their Thanksgiving recess last week and face a long “to-do” list.

The Senate is currently expected to bring up its version of a tax bill this week and there is still uncertainty about its fate.  President Trump and the Congressional Republicans have set out the December holiday period as their self-imposed deadline for signing into law tax reform legislation.  The House passed its version on a nearly partisan vote just before recessing for Thanksgiving, with 13 Republicans joining every Democrat in opposing the bill.

It still remains to be seen at this point whether there is enough Republican Senate support to get a bill passed.  No Democrats are currently expected to support the bill, and further complicating the process are the push to include a repeal of the Affordable Care Act individual health insurance mandate as well as the concerns of a handful of Senators about the impact of the bill on the federal debt.

Even though FY2018 started on October 1, none of the 12 individual funding bills have been signed into law and the government is currently operating under a temporary funding measure that expires at midnight, December 9.  Part of the delay in finalizing the final budget for FY2018 is due to the lack of an agreement on how much total funding is available for the year.  Negotiations are currently taking place between the senior leaders in both chambers and representatives from the Administration about the top line funding levels for the rest of this year and potentially for next year.  Another short-term temporary package to keep the government funded past the December 9 deadline will most likely be needed to buy more time for the negotiators.

At the same time, there are discussions underway, at least among Congressional Democrats, about trying to tie a legislative fix on DACA/Dreamers to the end-of-the-year funding package.  Several Democrats have been very vocal about their support for such a move.

Potentially complicating the “to-do” list further is the sexual harassment controversies that have surfaced recently in both chambers.

This Week: CHIP and Taxes

The House and Senate are back this today for what will be the long slog until Thanksgiving. There’s a ton of to-do items on the agenda, including tax reform, raising the debt ceiling, FY 2018 appropriations, the annual National Defense Authorization Act (NDAA), and the list goes on. The focus for the House this week will be extending the Children’s Health Insurance Program (CHIP), while the Senate will continue on more judicial nominations. Both Houses will begin to turn efforts into tax reform.

The House is set to unveil their version of a tax reform bill on November 1 and a mark up in committee shortly thereafter.  Tentatively, this means, the House could consider the measure on the Floor during the week of the November 6. After passage, the measure would move to the Senate the week of November 13 for mark-ups in the Senate Finance and Energy and Natural Resources Committees and floor consideration during the week of the 20, which is Thanksgiving Recess. Per the agreed expedited process, the tax measure would be considered as a reconciliation bill, so it would only get 20 hours of debate and a vote-a-rama — it could be considered in three days.  While this schedule is incredibly ambitious, this framework is the working schedule as of now.

The House— one month after funding for the CHIP has lapsed — is gearing up for a vote on extending funding for the federal program, which insures nine million children in the US. Both parties have been negotiating for weeks. Earlier this month, the House Energy and Commerce Committee approved a measure to fund CHIP for five years with zero Democratic support. Democrats opposed cutting dollars from Obamacare’s public health fund to pay for the measure — so it wasn’t sent to the floor for a vote. However, the GOP is now moving forward as the clock keeps ticking: several states are slated to run out of CHIP money in the next few weeks.

Meanwhile, at the other end of Pennsylvania Avenue, ehe Administration is set to announce a new Federal Reserve Chair this week and keep up the drum beat on opioids, but the Mueller investigation might make that difficult.

Stay tuned.

House Passes Emergency Spending

Today, the House voted overwhelmingly to provide $36.5 billion in disaster relief for victims of recent hurricanes and wildfires, as well as emergency credit to help Puerto Rico keep its government functioning. The spending bill, known as a supplemental appropriations measure, now moves to the Senate for consideration next week.