CR Sticking Points (Sep. 21)

Mike & Co. —

Practically every member of Congress running for re-election wants to be with the voters, not with each other with Election Day less than 50 days away.  Only one thing stands between them and adjournment right now — adoption of a budget for Fiscal Year 2017, which begins in ten days.  No one in Congress thinks a default would be better than a Continuing Resolution keeping the government functioning and there is no quarrel among them regarding spending levels.

Yesterday, on an 87-9 vote, the Senate passed the House vehicle for the continuing resolution.  Meanwhile, the  negotiations continue.  Below we have a look at the open issues and sticking points slowing the budget agreement negotiations as they stand midweek.

Best,

Dana

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With the 2016 elections approaching, pressure has begun to build in the Senate to pass a continuing resolution (CR) which will allow Congress to adjourn.  Senate Republicans, with 24 seats at play, are especially eager get back; Democrats only need four more seats for a majority if they win the Presidency, and so are less inclined to strike a deal that will send Congress home early.  In this context, several sticking points have arisen in the negotiations that are outlined below.

Zika Virus Funding 

The most serious obstacle to an agreement so far has been over funding for the Zika Virus in Puerto Rico. Currently, the bill provides $1.1 billion in emergency spending to Puerto Rico to combat the Zika Virus, now running rampant over the island.   The draft bill has (had?) language blocking any access to these federal funds for Planned Parenthood and its local affiliate, Profamilias, the biggest health care provider on Puerto Rico.

The most recent language has $95 million in block social services grants from the $1.1 billion.  Of the $1.1 billion allotted to combat Zika, $95 million has been set aside for block social service grants, which can be accessed by Planned Parenthood. It does not indicate precisely where funds will go, nor does it explicitly block Planned Parenthood from accessing it, essentially avoiding the political quagmire all together.

The argument is now over how to offset the $1.1 billion.  As an emergency spending measure, the funding is not required to be offset since it does not count against the budget cap, though it would affect other areas of discretionary spending.

The GOP is pushing for offsets in other areas to make the emergency relief budget neutral.  Most observers believe that this issue has tentatively been decided, however, as with all emerging agreements nothing is fully confirmed.

Cruz

The negotiations have not been helped by resistance to a proposal to hand over control of the U.S.’s internet domain name system to an international body. The proposal by the administration would hand over maintenance of the US’s domain name system to an international regulatory body, bringing the US domain names in line with the rest of the world. The move has been highly recommended by international organizations.

Sen. Cruz has fought this move, vowing to prevent what he calls the “Internet handover,” apparently concerned that the change would infringe on the free nature of the internet. This despite assurances from the administration and Sen. Nelson, ranking member on Science, Technology and Transportation, that the US would not lose any control over the internet itself, and that this is simply for coordination of domain names.  So far Cruz has not said that he will hold up the budget negotiations over the issue.

Flint and Louisiana Relief

Another open issue in the negotiations is emergency funding for extensive flood damage in Louisiana.   Senate Democrats are not against the measure, but argue that provisions to rebuild the water infrastructure of Flint, Michigan should also be added.  With the GOP refusing to provide the funding for Flint, there is word that Democrats may be  willing to pass the relief funds for Louisiana without money for Flint.

Ex-Im

The administration had sought a rider in the CR restoring the Ex-Im Bank’s authority to provide trade financing for projects larger than $10 million.  The Bank is barred from lending to larger-scale projects so long as three of its five Board seats are vacant.   But yesterday the administration withdrew its request for any riders, including Ex-Im.

Republican and trade advocacy groups, as well as key Congressional leaders, including Sen. Shelby, oppose an Export-Import Bank provision to restore the Bank’s ability to make loans above $10 million without a three person quorum.  The GOP refuses to approve new board members for the five-person board or to waive the three-person quorum requirement.  The conservative groups argue that the provision is policy rider non-germane to a CR.

Securities and Exchange Commission

Senate Democrats are hoping to remove language blocking the Securities and Exchange Commission from requiring public companies to report their political activities.  In the 2015 end of year spending package, Republicans included a rider which prevented the SEC from forcing companies to reveal their political spending.  Now Democrats want the provision to expire with the new budget agreement, while Republicans want to extend it.  It remains a minor but outstanding issue in the negotiations.

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