Things to Know About Capitol Hill’s Budget Endgame

By The Associated Press
The Associated Press
The Associated Press
December 9, 2015 Updated: December 9, 2015

WASHINGTON—House Republicans have unveiled a short-term spending bill to keep the government open and give senior lawmakers a few more days to finalize a massive spending bill and a package of tax breaks.

Rep. Hal Rogers (R-Ky.) unveiled the bill that would run through next Wednesday. Without the stopgap measure, many government functions would shut down at midnight on Friday.

Both Republicans and Democrats said Wednesday that dominos are beginning to fall in late-stage talks: Republicans appear likely to win repeal of a ban on exporting U.S. oil while Democrats are on track to renew tax breaks for solar power and other renewable energy sources.

High-profile GOP attempts to rein in new Obama administration environmental regulations are being winnowed away, though Senate Majority Leader Mitch McConnell (R-Ky.) appears on track to win a change in campaign finance law to lift limits on spending by party committees of behalf of candidates for federal office.

The spending measure—dubbed “The Omnibus” inside the Capital Beltway—is an amalgam of 12 spending bills distributing the $1.1 trillion portion of the budget that’s set each year at the discretion of lawmakers. The package of “tax extenders” is a hodgepodge of tax breaks that get renewed every couple of years or so.

Here are a few things to know about Washington’s year-end race to wrap up its budget work:

The Omnibus Is Details, Details, Details

October’s budget deal was just a blueprint. It added $66 billion to the budget for the ongoing fiscal year, paid for by offsetting spending cuts and new revenues.

The omnibus measure, however, is the structure that follows the blueprint. Lawmakers on the powerful House and Senate Appropriations committees go through the budget for each agency line by line, cobbling together a bill that’s likely to run in excess of 1,000 pages. The work is bipartisan, but Republicans, in the majority, are clearly in charge.

Cabinet departments like Veterans Affairs, Justice and Defense are getting the most generous increases; Housing and Urban Development and the Environmental Protection Agency don’t do as well.

Riders Are the Storm

Most of the money issues have been worked out. The chief hang-ups to finishing the spending bill are a slew of policy provisions known as “riders.” Lawmakers use these provisions to try and force the administration to do something Congress wants or to block regulations and policies that the lawmakers don’t like.

The riders include attempts by the trucking lobby to permit longer tandem trucks on the road and block rules requiring additional rest for drivers. The financial services industry is seeking relief from the tighter regulation embodied in 2010 Dodd-Frank law, while a senior Cuban-American lawmaker is trying to block the administration from loosening travel restrictions to Cuba. Broadcasters appear likely to hold onto advertising sales agreements with other stations in the same market despite a Federal Communications Commission rule curbing the practice.

But the biggest storm involves numerous efforts by Republicans to fight Obama’s environmental agenda, including moves to block new emissions standards for power plants, blunt an ambitious rewrite of clean water rules, prevent the administration from regulating “fracking” on federal lands, and curb new regulations on ozone.

Veto Threats Matter

If Obama adamantly opposes something, it isn’t likely to happen. That means GOP efforts to block the ongoing implementation of Obama’s marquee health care law or to strip away federal funding for Planned Parenthood are dead.

Syrian refugees are a similar hot-button issue. Many Republicans want to attach a recently-passed bill—rushed through the House in wake of last month’s terror attacks in Paris—to make it more difficult for Syrian refugees to enter the U.S. But Obama has threatened a veto of that as well, and the measure is unlikely to be attached to the omnibus, at least as written.

Instead, a bill that passed the House on Tuesday with broad bipartisan backing, which would tighten controls on foreigners entering the U.S., is a likely addition.

Tax Breaks Smorgasbord

There are more than five dozen tax breaks, many of which have been in place for more than 20 years but have never been made permanent. Every two years or so, Congress renews them, and the ritual has financed an untold number of second homes for tax lobbyists and college education for their kids.

Some of the tax breaks go to individuals, including a sales tax deduction for people residing in states without an income tax and a tax break for teachers who buy materials for their classrooms. But most of the money goes to business, including a popular tax credit for investments in research and development and write-offs on investments in new equipment.

The chief debate now is whether to “go big” and make some of the tax breaks such as the R&D tax credit permanent, while also addressing items important to Democrats, like refundable tax credits to help with the costs of raising children and college tuition. Also on the table is a delay in implementing the so-called Cadillac tax on high-cost health care plans and a pause in the 2.3 percent tax on medical devices that’s helping to pay for the health care law.