Spending, Taxes Top Congress's Spring-Summer Agenda

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By Nancy Ognanovich and Jonathan Nicholson

Spending and tax matters are expected to dominate as House and Senate Republican leaders bring lawmakers back into session the week of April 24 intent on helping President Donald Trump score his first major legislative victories.

Awaiting lawmakers as they return from recess will be 11 unfinished fiscal 2017 funding bills that House Speaker Paul Ryan (R-Wis.) and Senate Majority Leader Mitch McConnell (R-Ky.) want to roll into a massive omnibus and send to Trump’s desk before a stopgap funding the government expires April 28. After that, GOP leaders will await the arrival of Trump’s fiscal 2018 budget, which will kick off intense work in both chambers on next year’s appropriations bills over the next several months.

In addition to having to vote to keep the government funded past April 28, the House in its first week back is slated to vote on a bill changing how the head of the Copyright Office is appointed. The measure would make the post a presidential appointee, subject to Senate confirmation, for a term of 10 years; currently the librarian of Congress names the appointee.

Meanwhile, House lawmakers hope to get started on an ambitious effort to reshape the complicated U.S. tax code. But the timing of both the tax overhaul effort and the fiscal 2018 appropriations process could be affected by how quickly the FY17 funding bills are wrapped up and whether House Republicans take another run at repealing the Affordable Care Act.

An all-member House Republican conference call was slated for the April 22-23 weekend to discuss options. GOP leaders said they were moving closer to bridging the divide between the conference centrists and the hardliners in the House Freedom Caucus when they left for the break, though moving back to health care could eat up valuable weeks of the House calendar as Republicans hope to move on to the tax overhaul quickly.

Across the Capitol, the Senate is likely to soon consider the last of Trump's Cabinet nominees before turning to the deputy secretaries at the federal agencies. McConnell also is expected to begin scheduling many of Trump’s economic advisers for confirmation votes in the late spring and early summer.

Congress is coming back for a late-spring work period that runs to the Memorial Day recess beginning May 29. When the House and Senate return again the week of June 5, lawmakers plan to be in session until the July 4 recess that begins June 30. The last three-week stretch is scheduled from July 10 to July 28.

Spending Bills

Ryan and McConnell want to set the stage for a successful seven weeks this summer by first disposing of the current fiscal year’s unfinished appropriations bills, which they agreed in December to hold over in order to give Trump more say over federal spending decisions. The leaders are discussing plans to create an omnibus by attaching 10 of the bills to the Department of Defense appropriations bill (H.R. 1301) and moving it through both chambers quickly before the current continuing resolution funding the government expires on Trump’s 100th day in office.

In addition, the House plans to take a 10-day break in May that the Senate doesn’t observe.

The prospects for the omnibus to get to Trump’s desk with only hours to spare—or even soon after April 28—dimmed somewhat when House and Senate negotiators were unable to report an agreement on the package prior to leaving for the spring recess. However, lawmakers said talks at resolving remaining issues were going well.

Two House Republican aides said a one- or two-week stopgap funding bill might be necessary. House Democrats have signaled they could support a short-term continuing resolution if it simply gave lawmakers time to wrap up negotiations.

Some issues seem settled, one of the aides said. Ryan has said the question of Planned Parenthood funding should be dealt with in a separate, budget-related bill instead of the appropriations process. And while the White House has demanded funding for a border wall that Democrats oppose, Democrats have said they could accept additional money for increased border security, leaving room for a potential compromise.

The stickiest issue might be health care-related, as Democrats want an extension of payments known as cost-sharing reductions, or CSRs. The federal payments are made to insurers to reduce out-of-pocket costs for low-income Americans. Ryan has said he expects the payments to continue while a lawsuit concerning them plays out in federal court. Politically, extending them in the funding bill could be seen as supporting the Affordable Care Act, and thus a big concession by Republicans. One of the GOP aides said, “It’s probably a leadership call at the end of the day.”

New Budget

More fiscal issues are on tap for May, when Trump is expected to send his FY18 budget to Capitol Hill that fleshes out the blueprint he announced in March. While the blueprint dealt only with federal discretionary spending, the May budget is expected to also address levels for mandatory programs, tax revenues and economic projections.

It remains unclear how quickly lawmakers will turn to writing a fiscal 2018 budget resolution after getting the White House’s full budget. Senate Budget Committee Chairman Mike Enzi (R-Wyo.) has said timing is up in the air on his side of the Capitol. In the House, no decision has been made yet but the hope is to have one introduced in mid- to late May. One GOP aide said a budget could be introduced in the May 22 week in the House.

The budget resolution might face obstacles. Trump has proposed sharp cuts in non-defense appropriations that could make it hard for centrists to support a resolution that followed that outline. At the same time, Trump has largely sworn off tackling Medicare and Social Security, areas that hardline anti-spending members say need to be overhauled to get their support.

Tax, Banking Regulation Overhauls

Republican leaders also want to use the summer to push their ambitious plan to overhaul the tax code, work that already has been underway for more than a year in the House and Senate tax-writing committees. If successful, the overhaul will be the first since 1986.

House Ways and Means Committee Chairman Kevin Brady (R-Texas) has said he wants to mark up a bill sometime in the spring. However, that timeline could be affected by whether the FY17 appropriations process gets wrapped up in April or May, and by how quickly a 2018 budget resolution is agreed to in both chambers that would allow for a resulting tax bill to be filibuster-proof in the Senate.

Also in the works is what Trump calls a “major elimination” of many Dodd-Frank Act provisions that Congress passed after the 2008 financial crisis.

The House Financial Services Committee scheduled an April 26 hearing on a draft bill—the Financial CHOICE Act, from committee Chairman Jeb Hensarling (R-Texas)—designed to replace Dodd-Frank. A revised version of a measure the committee moved in the last Congress, it would change bank capital standards and roll back numerous banking and securities regulations.

The Senate Banking, Housing, and Urban Affairs Committee also is expected to tackle Dodd-Frank, but it is less likely that the committee will pursue changes as far-reaching as the House panel.

To contact the reporters on this story: Nancy Ognanovich in Washington at nognanov@bna.com; Jonathan Nicholson in Washington at jnicholson@bna.com

To contact the editor responsible for this story: Paul Hendrie at pHendrie@bna.com

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