The information below comes to us from the County's federal advocate, Alcalde & Fay, who provided their "This Week in Washington" report to the County for the week of January 27-31, 2020. (Note, the report contained information about the status of the impeachment trial of President Trump, which has now concluded as of the writing of this report, and is therefore omitted as the information is no longer timely.) Information is also provided from the CSAC Update From Washington, DC
INFRASTRUCTURE PROPOSAL
The Chairs of several key House Committees joined House Speaker Nancy Pelosi (D-CA) on Wednesday at a press conference announcing their framework for a massive infrastructure proposal that includes investments in both surface transportation priorities (roads, bridges, transit systems, airport and seaports, etc.) as well as in clean water systems, broadband, and energy efficient infrastructure. The framework, which totals $760 billion over five years, does not include any legislative text or specific funding levels beyond topline numbers for the various overarching categories. Instead, the proposal is meant to serve as an outline of House Democrats’ ambitious infrastructure-related plans for the final year of the 116th Congress. Speaker Pelosi was quick to note that while ambitious, their hope is to work with the President and Congressional Republicans on each of the proposals. For your reference, the full 19-page framework is available here and a 3-page factsheet is available here.
During the press conference, House Transportation & Infrastructure Chairman Peter DeFazio (D-OR) stressed that his Committee was working to draft a surface transportation reauthorization bill but that it likely wouldn’t be introduced for several weeks, or possibly several months. Speaker Pelosi also gave no specific timeline for moving the framework’s various legislative components to the floor, or whether they would be considered as part of a broad catch-all infrastructure package or as stand-alone bills. While several policy highlights pertaining to surface transportation initiatives are included throughout, the framework only includes topline spending amounts of $319 for highway programs and $105 billion for transit programs (outlined in pages 2-5 of the framework). The most recent surface transportation bill, the Fixing America's Surface Transportation (FAST) Act, is scheduled to expire on September 30, 2020, and as such, Congress has a short window of time left to reach an agreement on the next long-term reauthorization bill.
With a $760 billion price tag, questions remain as to how Democrats will pay for many of the framework’s proposals, especially given the lack of adequate funding available to fund the surface transportation reauthorization bill component. On the topic of funding, both for the next surface transportation bill and for the framework’s numerous new initiatives, House Ways and Means Committee Chairman Richard Neal (D-MA) indicated that his Committee would not come out with any large new or increased revenue streams without buy-in from the Administration (and, he hoped, Congressional Republicans). Later that same day, the Ways and Means Committee held a hearing to discuss the importance of identifying viable revenue streams and innovative methods of financing infrastructure projects going forward, in light of the dwindling Highway Trust Fund (HTF). In recent years, the HTF has faced a funding shortfall caused in large part by the discrepancy between gas tax receipts and current spending levels, leading Congress to rely on short-term funding patches including transfers from the General Fund. While there has been broad bipartisan support for shifting away from relying almost entirely on the current HTF revenue structure, there has been less agreement on which of the potential options should be implemented to shore up the HTF and/or allow for a dramatic increase in infrastructure spending.
During the hearing, members of the Committee engaged witnesses in discussions on several such proposed sources of revenue, including a tax on Vehicle Miles Traveled (VMT) and the politically thorny option of increasing the gas tax. Of particular note, while there have been privacy concerns related to the VMT and tracking vehicle movement, the program has garnered strong bipartisan support in recent years, including from T&I Committee Ranking Member Sam Graves (R-MO). With regard to the gas tax, T&I Committee Chairman DeFazio has indicated his strong support for that option and has proposed increasing the gas and diesel tax by approximately 1 cent per year. Most of the witnesses offered their support for such an increase, including Mr. Joung Lee, Director of Policy and Government Relations for American Association of State Highway and Transportation Officials (AASHTO), who called for “increasing and indexing” the gas tax to provide a sustainable source of revenue that could then be amplified by additional programs. Congressman Brendan Boyle (D-PA) dismissed the notion that voting to increase the gas tax could endanger a member’s re-election prospects, noting that when the Pennsylvania legislature voted to increase and expand revenue models dedicated to transportation, not a single member that voted in support of the proposal lost reelection.
While Chairman Neal did not commit during the hearing to any particular source of revenue, Ranking Member Kevin Brady (R-TX) spoke out several times against any increase to the gas tax, arguing instead in support of adopting “innovative policies that will attract more private capital into infrastructure.” The hearing also touched on the potential for expanded financing options, including bringing back the popular Build America Bonds program and expanding the use of Private Activity Bonds. Mr. DJ Gribbin, Founder of Madrus LLC, also testified in support of the TIFIA program and called for more liberalized tolling policies that attract private investment, which he said could each “help with financing and taking more of the burden off of the taxpayer.” While the other witnesses supported innovative financing programs, Mr. Lee noted that these programs are “insufficient in and of themselves” to meet transportation infrastructure needs. Ms. Diane Gutierrez-Scaccetti, Commissioner of the New Jersey Department of Transportation, also noted that project planning was suffering in recent years as states were increasingly unable to prioritize projects due to a lack of insight and predictability pertaining to future funding availability.
MEDICAID BLOCK GRANT PROPOSAL
On Thursday, the Trump Administration announced the Healthy Adult Opportunity (HAO) initiative, a new optional Medicaid demonstration program that would allow states to receive capped funding (block grants) in exchange for more flexibility in the administration of Medicaid programs. The Administration asserts that this this will lead to lower federal spending over time and increase program efficiencies at the local level. Currently states receive a percentage of Medicaid costs from the federal government through matching rate funds and are required to comply with provisions from the Department of Health & Human Services (HHS) Centers for Medicare & Medicaid Services (CMS), but this new initiative will allow states to apply for a block grant of Medicaid funding based on certain guidelines outlined in the policy guidance. States will have the option to apply for either a negotiated, capped amount based on previous year expenses and population, or a base amount that would cover expenses at a per-enrollee basis. The HAO initiative is intended for coverage for individuals under the age of 65 who are not Medicaid-eligible due to disability or long-term care needs. Additionally, states will have the flexibility to establish their own eligibility conditions on coverage included under an HAO demonstration that do not apply to Medicaid coverage under state plans. Proponents of the rule believe it will allow for innovation in the healthcare system without states having to wait for federal approval; however, opponents of the proposal suggest the initiative will lead to reductions in eligibility or coverage, as well as cuts to Medicaid spending for those participating states. For your reference, the CMS letter to State Medicaid Directors with the full guidance is available here , and the CMS fact sheet is available here.
WATERS OF THE UNITED STATES
Last week, the Trump Administration finalized a rule that updates standards for regulating waterways, revising a more expansive rule for defining “Waters of the U.S.” previously proposed during the Obama Administration. The new rule, which falls under the federal regulatory authority of the Clean Water Act, designates four categories of waters for federal regulation: (1) territorial seas and traditional navigable waters; (2) perennial and intermittent tributaries; (3) certain specified lakes, ponds, and impoundments; and (4) wetlands adjacent to jurisdictional waters. The rule also specifically sets forth categories of exclusions that are not “Waters of the U.S.” including: farm and stock watering ponds; waste treatment systems; groundwater; prior converted cropland, and other exclusions that encompass features that only contain water directly because of rainfall. Some groups have raised environmental concerns with excluding downstream water bodies from federal regulation. This is the second step in a two-step process to review and revise the definition of “Waters of the U.S.” This rule will become effective 60 days after publication in the Federal Register, and the pre-published version is available here.
PUBLIC CHARGE RULE
On Monday, the Supreme Court in a 5-4 decision ruled that the Trump Administration can implement its “public charge” rule, which states that the federal government can deny immigrants entry in the United States, and/or citizenship, if they are deemed likely to rely on public benefit programs such as non-emergency Medicaid, Section 8 housing and rental assistance, Temporary Assistance for Needy Families (TANF), Supplemental Security Income (SSI) or the Supplemental Nutrition Assistance Program (SNAP). The rule was originally scheduled to go into effect on October 16, 2019, however numerous federal judges blocked it from being implemented, with the most recent injunction issued earlier this month. The Department of Justice (DOJ) subsequently filed an emergency appeal asking the Supreme Court to lift the injunction. In their separate concurring opinions, Justices Neil Gorsuch and Clarence Thomas both criticized the numerous court-ordered injunctions preventing the rule from going into effect.
Many advocacy groups have challenged this rule stating that it could adversely harm the national economy and discourage people from enrolling in benefits programs, for fear that it could jeopardize their immigration and/or citizenship status. Following the Supreme Court decision, the U.S. Citizenship and Immigration Services (USCIS) announced it will begin implementing the public charge inadmissibility rules on February 24, 2020.
CSAC: House Democrats Unveil Draft Climate Bill
On January 28th, Democratic leaders on the House Energy and Commerce Committee unveiled a draft climate change package – the Climate Leadership and Environmental Action for our Nation’s (CLEAN) Future Act – that would achieve net-zero greenhouse gas pollution by 2050. The 622-page proposal includes a number of ambitious reforms that would fall within the committee’s jurisdiction, such as a federal clean energy standard. Among other things, the plan would create a Clean Energy Credit Trading Program that would allow entities to buy, sell, and trade credits to demonstrate compliance with their obligations. It also would require utilities to obtain all of their power from “clean” energy sources by 2050.
The leadership proposal is not meant to be a final product. Instead, it was publicly released to spur feedback from environmental and industry groups, individual companies, and other House Democrats. The full draft can be accessed here, and a section-by-section summary can be found here. In an attempt to solicit feedback and recommendations from stakeholders, the panel is expected to hold hearings throughout the year. In the meantime, stakeholders are welcome to submit comments to CleanFuture@mail.house.gov.
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