September Washington D.C Preview

As the Sept. 30 government funding deadline approaches, POLITICO Pro policy teams take a look at Capitol Hill’s packed agenda.

 

 

QUICK FIX

 

 

— As farm bill programs near expiration, leaders on Senate and House Agriculture Committees aim to pass a full reauthorization or extension of the farm bill likely come 2024.   — The Biden administration’s request for further aid to Ukraine will be one of the major spending differences the two chambers must hammer out to avoid a shutdown.   — Senate Democrats are expected to move two energy bills, both of which exceed the spending caps set in the debt ceiling deal and are likely to receive pushback from House Republicans.

 

 

AGRICULTURE Farm bill programs set to expire: Along with current government funding, programs within the farm bill start to expire Sept. 30. Congress is sure to miss that deadline amid delays from the government spending fight that have thrown the key legislation into limbo.   The massive farm bill reauthorization process takes place every five years. But leaders on the Senate and House Agriculture Committees have indicated that there are no plans to pass an extension of the bill before Sept. 30. Instead, they aim to pass a full reauthorization or extension of the farm bill by Dec. 31.   As the delays pile up, an extension is increasingly likely. The best-case scenario for lawmakers to pass a reauthorization out of both chambers, resolve differences within the House and Senate bills and then pass a final piece of legislation is the first half of 2024.   The top Democrats and Republicans on the Agriculture Committees still need to hammer out key funding and policy fights over nutrition funding, support programs for commodities and where in the farm bill they allocate nearly $20 billion in climate-related agriculture funds from Democrats’ Inflation Reduction Act. — Meredith Lee Hill

 

 

DEFENSE — Ukraine aid clash: September is likely to see a showdown between the House and Senate over whether to include a new round of assistance for Ukraine in a funding patch to keep the government open.   President Joe Biden has requested $24 billion related to Ukraine and Europe for the first quarter of the fiscal year that begins on Oct. 1. There’s bipartisan support in the Senate for spending more to arm Ukraine, but a growing faction of House Republicans opposes new funding for Kyiv.   The gap means Ukraine will be one of several big spending differences the two chambers must overcome quickly to prevent a shutdown by the end of the month.   — Pentagon program freeze: If lawmakers avert a shutdown, the Pentagon will still almost certainly start the fiscal year on a stopgap funding measure. Military brass often criticize continuing resolutions, which carry over the previous year’s funding levels, because they don’t allow the Pentagon to begin new programs or ramp up existing ones unless Congress grants specific exemptions.   The Biden administration hopes lawmakers at least grant some relief for the Navy’s new fleet of ballistic missile submarines, which it warned could be delayed without fresh funding.   Expect Pentagon leaders to increase their warnings of the national security impacts if a fiscal stalemate drags out or the government shuts down. — Connor O'Brien

 

 

ENERGY — Energy’s budget standoff: The standoff over energy spending will heat up this month with Democrats in the Senate set to move on the $58 billion Energy-Water spending bill and a $42.7 billion Interior-EPA funding package that both passed appropriation committees with unanimous support — and which exceed the spending caps set in the debt ceiling deal.   That’s likely to draw a cold response from House Republicans, whose take on those bills would lean into GOP priorities by stripping billions from clean energy programs and requiring new oil and gas lease sales.   — Reform on backburner: The budget fight is likely to sideline efforts to take another shot at permitting reform, which proponents on the Hill promise remains a bipartisan priority. So far, there’s been no sign they’ll find compromises on transmission, limits on lawsuits and GOP proposals to streamline approvals of fossil fuel and critical minerals projects. — James Bikales

 

 

EDUCATION — Education spending discrepancies: The House and Senate versions of the bills to fund the Education Department have several spending level differences as the Oct. 1 start to fiscal 2024 approaches.   The bipartisan spending bill in the Senate would provide $79.6 billion in discretionary funds for the agency while the House version would provide $67.4 billion. Senate appropriators have stressed that the upper chamber’s spending bill is within the spending caps outlined in the debt ceiling deal, while the House bill is a 15 percent reduction compared to the current year.   Some proposals in the House bill include making a cut to low-income K-12 schools with an 80 percent reduction to Title I, maintaining the maximum Pell Grant award at $6,335 and cutting funding for the Office for Civil Rights by 25 percent.   The Senate bill would keep education spending at roughly the same level as the current year, while including a $175 million boost to Title I and bringing the Pell Grant award up to $7,645. However, some portions of the Senate bill propose flat spending such as keeping career, technical and adult education funds at $2.2 billion.   — In the interim, the Biden administration is asking for $2.3 billion in stopgap funding for the Student Aid Administration to ensure that federal student aid isn’t held up as lawmakers on Capitol Hill eye a continuing resolution. Student aid spending is another area where the upper chamber and lower house appropriators are divided. — Mackenzie Wilkes

 

 

CYBERSECURITY — Confronting the dangers of AI: The DEFCON conference in Las Vegas in August piled the pressure on Capitol Hill to take action on the national security risks of artificial intelligence after the White House supported an event in which the world’s best hackers looked for holes in new AI models. In addition, reports that the Chinese government is already using AI for spreading disinformation meant to divide U.S. voters online will only enhance the worry for lawmakers.   During the second week of September, no less than three different Senate committees are scheduled to hold hearings focused variously on legislating AI, increasing transparency on AI policies and using procurement and acquisition to govern the use of AI. That same week, Senate Majority Leader Chuck Schumer plans to host an AI summit with leaders from Meta, Alphabet and Tesla, among others, the first of what Schumer said in early September is the “first of a series of forums” to help inform congressional policies.   — The effort continues to pass the annual National Defense Authorization Act, which the House and Senate are still struggling to come to a compromise over. The current House and Senate versions contain a plethora of cybersecurity measures. In the Senate, this includes election security enhancements and new cyber authorities for the State Department, and in the House, language to address threats from China.   — The potential government shutdown will likely make the White House and intelligence agencies only more concerned about the prospects for reauthorization of Section 702 of the Foreign Intelligence Surveillance Act. The clause, which gives the government power to collect data on foreigners overseas, has been misused in recent years. — Maggie Miller

 

 

HEALTH CARE Congressional health care priorities this fall:   — The White House ask: The Biden administration wants a continuing resolution to include $3.7 billion for CMS to assist with eligibility verifications of Medicaid and marketplace programs and $1.9 billion for HHS’ Office of Refugee Resettlement, noting that certain health programs must also be extended.   — Shutdown impact: During a government shutdown, essential services remain running, so Medicare and Social Security checks would still go out the door, and the exchanges would remain open. But as the administration prepares for a fall vaccination campaign, a shutdown would hamper efforts to tamp down outbreaks.   — Emergency funds: According to HHS’ contingency plan, some Covid-19 programs, like vaccine development and authorization and clinical trials, would continue using emergency funding appropriations from 2020 and 2021. The CDC’s contingency plan also promises to keep the Vaccines for Children program going while continuing to monitor public health threats. HHS expects to furlough about 40 percent of its workforce if the government shuts down. Staff that work on Medicare, Medicaid and other mandatory health programs would be retained.   — Past predictors: As past shutdowns have shown, the health programs that remain open can vary depending on how essential they’re deemed to be at the time. Prior shutdowns have seen the NIH briefly closed its portal to register new clinical trials; CMS losing discretionary funding for waste, fraud and abuse; and new Medicare enrollees being turned away daily in alarming numbers. Health policy experts said that’s unlikely to happen if a shutdown is not averted. — POLITICO Health Care Team

 

 

EMPLOYMENT AND IMMIGRATION — Rulemaking and a possible UAW strike: The Labor Department has been pressing forward with a host of new rules covering everything from overtime pay to miners’ exposure to hazardous dust in recent weeks.   DOL rulemaking slowed down mid-year as the Biden administration focused on its abortive attempt to get acting Secretary Julie Su confirmed for the top job, but the pace has since accelerated.   Several major items remain on DOL’s to-do list, chief among them being finalizing changes to the framework used to distinguish independent contractors and traditional employees, the latter of which enjoy certain labor protections that the former do not.   A government shutdown that sidelines DOL’s policymaking teams could endanger the administration’s ability to finalize those rules before the 2024 elections. Failure to do so puts the rules at risk of being swiftly reversed — or permanently blocked via the Congressional Review Act — if the balance of power in the White House swings back to Republicans.   — The Biden administration is also closely monitoring negotiations between Detroit’s Big Three car companies and the United Auto Workers. The two sides appear to be far apart from an agreement, and the threat of a strike that could batter the economy looms — especially if it coincides with a shutdown in D.C. — Nick Niedzwiadek

 

 

TAX The tax agenda in September: Lawmakers will try to settle their differences over the IRS’ budget for the upcoming fiscal year, not to mention a passel of policy riders House Republicans are trying to attach. The agency is asking for $14 billion, which would be an increase from the current $12.3 billion. House Republicans want a cut, to $11.2 billion, while Senate Democrats would freeze the budget.   If the agency gets shortchanged, it may have to tap one-time funds Democrats provided last year to modernize the department. And if there’s a government shutdown, that will raise a whole other set of issues for the agency.   — Meanwhile, the Senate Finance Committee aims to take up a bill giving Taiwan treaty-like tax benefits amid an ongoing jurisdictional fight with the foreign relations committee over who gets to decide the issue.   — Across the Capitol, Ways and Means Chair Jason Smith (R-Mo.) continues to struggle to bring a big tax bill to the House floor amid complaints from colleagues that it doesn’t do enough to alleviate the $10,000 cap on state and local deductions.   And the tax world will be closely watching to see whether the two sides can come to an agreement on a year-end bill to undo recent restrictions on several popular business tax breaks and expand the child tax credit. — Brian Faler