The House Ways & Means Subcommittee on Oversight will hold a hearing on university endowments tomorrow, Tuesday, September 13th at 10 AM/ET. Titled, “Back to School: A Review of Tax-Exempt College and University Endowments,” the hearing is following up on an October 2015 hearing on, “The Rising Costs of Higher Education and Tax Policy.” The committee will hear from representatives from the Cato Institute, Washington College, the Urban Institute, and more.
News and updates
Hiccup with a CR
Writing a stopgap spending measure, known as a Continuing Resolution (CR), to avoid a government shutdown on October 1st, just got a bit harder than lawmakers anticipated.
Typically, CRs extend current funding levels into the new fiscal year for a short duration. Unfortunately, there’s a hitch this time. If current FY2016 funding is simply extended, it would exceed the FY 2017 discretionary spending caps as set by Sequestration in 2011. How much will it exceed? According to the nonpartisan Congressional Budget Office (CBO), a straight extension will exceed the caps by $10 billion.As scored by CBO for the purposes of a stopgap, FY 2016 base discretionary spending comes in at $1.080 trillion, $10 billion above the $1.070 trillion, FY 2017 limit.
The CBO explained that most of the excess spending comes from the scheduled expiration of some spending cuts in fiscal 2017, as previously passed in prior fiscal years.
So some of the same budget maneuvers that allowed Congress to spend billions more dollars in FY 2016 are now complicating the crafting of a stopgap funding measure to keep the government operating when the fiscal year ends on Sept. 30. The maneuvers that were used in FY 2016 include changes in mandatory programs, or so-called CHIMPs, that inflated nondefense spending in FY 2016. CHIMPs refer to provisions in appropriations bills that reduce or constrain mandatory spending, providing an offset for higher discretionary spending.
In preparing for a stopgap spending measure, the CBO’s score must eliminate any savings that do not automatically continue into the next year, including changes in mandatory programs that appropriators often make to free up extra money for discretionary projects. Changes in mandatory programs, mostly from an expiring cut to the Children’s Health Insurance Fund, account for $5.6 billion of the lost savings. Further, the CBO score assumes that a CR extends the entirety of the subsequent fiscal year, not a short duration — a prudent move since it is currently unclear how long the CR will last. The date being cited most often now is December 9th.
It is not yet clear whether the overage problem can be fixed through some simple technical corrections, or whether it could mean trimming any popular programs.
Meanwhile, the House Republican Caucus remains deeply divided on how to proceed. Despite the Constitution clearly stating that the power of the purse originates in the House, the Senate will go first in trying to pass a short-term CR next week to keep the federal government functioning through the November election.
Stay tuned.
What We’re Reading This Week, September 6-9
Here’s a selection of article the Federal Relations team is enjoying this week.
Stepping Up – The House Freedom Caucus wasted no time since returning from their summer recess showing just how tough they can make life for Speaker Paul Ryan — and for Democrat Hillary Clinton if she becomes President. They’re pressuring Ryan to oppose a deal taking shape in the Senate on must-pass legislation to keep the government open, and promising Clinton to keep investigating email issues even if she ends up in the White House. Read more in the AP.
Take Down – The closure of ITT Technical Institutes, a national chain of career schools with a 50-year legacy, is fueling a debate over the federal government’s aggressive policing of for-profit higher education and whether it could destroy the industry. Read more in the Washington Post.
Endowed? – A Sept. 13 hearing of a House Ways and Means subcommittee is set to look at how colleges, through their tax-exempt endowments, are trying to reduce tuition. The hearing in Washington, which will feature testimony from policy experts and college representatives, comes as many endowments are expected to post investment declines for FY 2016. Read more in Bloomberg.
Five To Flip – Democrats must net five seats — or four and retain the White House — to regain control of the upper chamber. They are defending 10 seats, while Republicans face a more challenging path, needing to defend 24 seats. The Hill has the nine seats most likely to go from Red to Blue.
10 Most Vulnerable – While several sitting Members of Congress have already been defeated in the primary, here is the latest 10 most likely Members to have a rough election. Read more at Roll Call.
Long List – Congress is back for a few weeks, and they have a lot to pack in, including many to-dos for research and science. Read more in Science.
Pledge for Childcare – Presidential nominee Hillary Clinton renewed her pledge to invest in child-care programs on college campuses, spotlighting the need for a service that has been disappearing at many schools just as the number of student parents grows. Read more in The Washington Post.
Balancing Act – Speaker Ryan has a tough month ahead of competing interests and political demands. Uniting the GOP conference has not proven to be an easy task. Read more at Roll Call.
Fact’s Don’t Matter – According to the Pew Research Center, the nation is more polarized than at any time in recent history. While some of the issues dividing us boil down to ideology and preference, there is at least one on which hard science should have a strong say. Facts, however, seem to polarize us more, rather than unite us. Read more in the New York Times.
Redistricting Redrawing the Map – A Washington Post-SurveyMonkey poll of all 50 states indicates the 2016 campaign could flip several red and blue states from their longtime loyalties. See how it shakes out at The Washington Post.
8 Hours in the Sky – For eight hours, with American airspace completely cleared of jets, a single blue-and-white Boeing-747, tail number 29000—filled with about 65 passengers, crew and press, and the 43rd President, George W. Bush, as well as 70 box lunches and 25 pounds of bananas—traversed the eastern United States. Politico has the story of those on Air Force One 15 years after the attacks of 9/11.
They’re BACK!!!!
After seven weeks of recess, the House and Senate are back to work today. Congressional lawmakers now have approximately 17 legislative days to figure out how to avoid a government shutdown before the new fiscal year (FY 2017) begins on October 1. As we saw last year (a non-election year), coming to an agreement on how to allocate federal fiscal resources is already and tough job. Now, with re-election campaigns now in high gear, political tensions have only grown worse since Congress adjourned in mid-July, further complicating the difficult dealmaking to come.
Adding another layer of complications and vitriol, at least on the House side, the House Freedom caucus, a vocal group of about 40 hard-core conservatives, are blaming GOP leadership for the defeat of one of the caucus’s most active members, Rep. Tim Huelskamp (R-KS), in a party primary in August.
Much of this week will likely be spent drawing battle lines over the expected stopgap measure, known as a continuing resolution (CR), that would extend current FY 2016 funding levels into the new fiscal year (FY 2017) for a short length of time. While a typical CR simply extends all current funding levels for a specified amount of time, pressure is building to add money to combat the Zika virus. A $1.1 billion Zika package collapsed in July in a partisan standoff, although efforts could be made to revive it with modifications. The Senate is feeling pressure to include Zika funding from Senators like Floridian Marco Rubio, who’s state has been particularly impacted. Flood relief for Louisiana is as expected to be discussed.
The length of the CR is also in question. Fiscal hawks of the House Freedom Caucus have long been arguing for a CR into March of 2017 to wait until the new President is in office. Many others in Congress, namely the Democrats, want to clear the decks for the new President and pass an omnibus measure in December — something the staunch conservatives in Congress have vowed to fight in the lame duck session. In fact, Senate Democrats have been very vocal on this issue, and without the support of the Senate Democrats on any CR measure, the Senate Republicans cannot overcome the 60-vote threshold to defeat cloture.
Look for much posturing to come!
What We’re Reading This Week, August 29 – September 2
Happy end of August Recess. Here are a few articles the Federal Relations team has been enjoying this week.
Just 90 – According to ‘carbon accountant’ Richard Heede there are 90 companies contribute two thirds of the global carbon emissions. Among those, the top eight companies — ranked according to annual and cumulative emissions — account for 20 percent of world carbon emissions from fossil fuels and cement production since the Industrial Revolution. Heede has compiled a massive database quantifying who has been responsible for taking carbon out of the ground and putting it into the atmosphere. Read more in Science.
SCOTUS Scooch? – Senate Republicans could relent on their hard-line stance in opposition to granting Supreme Court nominee Merrick Garland a confirmation hearing this year. Read more in Politico.
Extension Headache – Funding for the federal government dries up on October 1, which will force Congress to move a stopgap spending bill in September just weeks before the Nov. 8 presidential election. Members of the conservative House Freedom Caucus are pushing to extend government funding into early 2017, wary of a massive bipartisan spending deal in the lame-duck and rank in file Republicans are also wary of setting up the period after the election as a time to move on funding and a host of other issues.. But GOP leaders and House Democrats are already laying the groundwork for a short-term continuing resolution, or CR, that will set up a vote on a catch-all spending bill right before the holidays. Read more in The Hill.
16 – As more and more students and parents grow frustrated with the rising cost and uncertain quality of a college education; as employers and policymakers bemoan the negative economic effects of a lack of college-educated workers; and as voters turn angry about how the higher education system seems to perpetuate inequality rather than alleviate it, politicians are putting pressure on institutions to improve. Conditions are becoming ripe, in other words, for the innovators to take charge. Read about the 16 most innovative people in higher ed in Washington Monthly.
110 – Over 100 Republican thought leaders have declared to be against Trump. Read when and why they flipped at the New York Times.
South of the Border – Trump will meet with Mexican President Enrique Peña Nieto ahead of a major speech on immigration on Wednesday. The surprise visit comes as Trump is later scheduled to deliver what’s billed as a “major speech” on immigration in Arizona. Read more at NBC News.
7 Reasons – Why Trump will hate being President. Read them in Politico.
Welcome BACK! – The scaffolding around the Capitol Dome has been slowly going away, and the picturesque structure is starting to look like itself again. Read more in Roll Call.