Federal Issues update 1/31/2014
On Tuesday, January 27, President Obama delivered his fifth State of the Union address, calling on Congress to work with his administration on a number of priority issues. While the president sounded a tone of optimism and cooperation, he also made it clear that he would not hesitate to act unilaterally if Congress fails to advance legislation of consequence. In his speech, Obama outlined several executive initiatives, including a proposal to raise the minimum wage from $7.25 to $10.10 for new federal contract employees, while pressing lawmakers to follow suit with legislation to raise the minimum wage for all workers.
The president also used the opportunity to praise several recent bipartisan accomplishments in Congress, including the two-year Ryan-Murray budget agreement. Additionally, he urged lawmakers to take action on issues such as unemployment insurance benefits, transportation and water infrastructure, economic development, healthcare, and trade promotion authority. Of particular interest to counties, the president encouraged lawmakers to approve a new surface transportation law for federal highway, transit, and safety programs, as well as complete action on a pending Water Resources Development Act (WRDA) reform bill.
As expected, President Obama strongly urged Congress to pass a comprehensive overhaul of the nation’s immigration system. While the Senate has already acted on a comprehensive bill (S 744), House Republicans have largely opposed such an approach. To date, the House Judiciary Committee and Homeland Security Committee have approved five piecemeal measures dealing with agricultural guest workers (HR 1773), employment verification (HR 1772), visas for high-skilled workers (HR 2131), state and local authority over immigration enforcement (HR 2278), and border security issues (HR 1417). The president expressed optimism that a compromise can be forged with the GOP that would lead to a path to citizenship for the county’s 11 million undocumented workers.
On a related matter, immigration policy took center stage for House Republicans during their annual three-day policy retreat, which began on Wednesday, January 29. For his part, House Speaker John Boehner (R-OH) provided members with a one-page document laying out principles for an immigration overhaul. Incidentally, the speaker’s principles stress interior and border enforcement while explicitly stating that Republicans oppose a special pathway to citizenship for anyone who illegally entered the United States.
Another key issue discussed by Republicans was how to deal with the impending debt limit, which, according to the Treasury Department, must be extended by the end of February. It remains unclear what type of concessions GOP members will seek in exchange for another debt-limit increase.
As reported in the lead article of this week’s Legislative Bulletin, House and Senate Agriculture Committee leaders announced on January 27 a bipartisan, bicameral agreement to reauthorize for five years the nation’s agriculture and nutrition assistance programs. The long overdue Farm Bill rewrite had been held up for weeks over disputes on a number of issues ranging from dairy policy to farm subsidies to the Supplemental Nutrition Assistance Program (SNAP).
The Congressional Budget Office (CBO) estimates that the compromise measure would reduce deficits by $16.5 billion over the next decade. Some of the savings would be achieved by eliminating the system of direct payments to farmers and replacing it with two new risk-management programs and expanding the use of crop insurance for risk mitigation. The House approved the nearly 950-page conference report (HR 2642) on January 29 by a vote of 251-166, with the Senate expected to clear the measure early next week.
Among other things, the legislation includes a number of issues that are of interest to California’s counties. In particular, and in a victory for CSAC, the bill restores for one year mandatory funding for the Payments-in-lieu-of-Taxes (PILT) program. It should be noted that funding for PILT was not included in recently approved fiscal year 2014 omnibus appropriations legislation (PL 113-76), leading to an outcry from counties in California and other public lands states.
Under the final Farm Bill, over $400 million will be available for PILT nationwide in fiscal year 2014, a moderate increase from the previous year. While the one-year extension will ensure that counties receive their annual payments in June, this will be the last year that full funding will be provided for the program. Unless Congress reauthorizes PILT as a mandatory entitlement, it will once again become subject to the uncertainty of the annual appropriations process. For its part, CSAC has encouraged lawmakers to provide a multi-year renewal of this critically important program to provide public lands counties with long-term certainty.
In addition, the bill contains an $8 billion cut to SNAP, or CalFresh, as it’s known in California. By comparison, the Senate-passed Farm Bill (S 954) would have cut SNAP by roughly $4 billion, while the House measure (HR 2642) proposed a nearly $40 billion reduction to the program. The savings would be achieved by restricting states’ use of a nominal Low-Income Home Energy Assistance Program (LIHEAP) payment to trigger a larger SNAP benefit.
To date, 16 states, including California have employed this option by providing a LIHEAP payment as low as $1 annually to trigger higher SNAP benefits. Under the new Farm Bill, an individual could only get the expanded food stamp benefits if they receive a minimum of $20 in LIHEAP benefits.
It should be noted that California’s program began about a year ago, and initial estimates from the State indicate that as many as 200,000 households could see an average reduction in benefits of about 13% or $43 per month. The legislation also retains provisions from the House and Senate bills that would ban SNAP eligibility for violent felons, even those who have already served their prison terms. The compromise, however, did modify the language to only ban benefits if the felon violates the terms of his/her probation or other conditions.
Finally, the legislation would restore mandatory funding for rural development programs, which includes $150 million for the Water and Wastewater Program; $100 million for the Beginning Farmer and Rancher Development Program; $63 million for the Value-Added Producer Grant Program; and $15 million for the Rural Microenterprise Assistance Program (RMAP).
In other developments, the Senate passed on January 30 legislation (S 1926) that would postpone National Flood Insurance Program (NFIP) premium increases mandated under the Biggert-Waters Flood Insurance Reform Act of 2012 (BW-12). Pursuant to BW-12, the increased rates – which are intended to reflect the current flood risk to properties and address the NFIP’s $24 billion debt – are required to be phased-in over five years.
In response to concerns from many homeowners and businesses that BW-12 will result in massive insurance premium increases, a coalition of lawmakers from flood-prone states have been working to delay the rate increases until the Federal Emergency Management Agency (FEMA) conducts an affordability study. Under S 1926, the proposed FEMA study and a subsequent congressional review are expected to take roughly four years.
It should be noted that a faction of lawmakers – as well as the White House – favor amending BW-12 to allow for a slower phase-in of the law’s premium increases (as opposed to delaying the rate hikes, as called for under S 1926). Supporters of a slower phase-in argue that this would give property owners time to prepare for higher premiums while at the same time addressing the NFIP’s debt. During Senate floor debate, that assertion was rejected by sponsors of S 1926, who argue that such an approach would allow rate increases to occur before FEMA completes the proposed affordability study.
Across Capitol Hill, it remains uncertain whether House leaders will consider the Senate-passed bill or seek to modify the phased-in rates mandated by BW-12.
Finally, Representatives David Valadao (R-CA), Devin Nunes (R-CA), and Kevin McCarthy (R-CA) on January 30 led the entire California Republican congressional delegation in introducing emergency drought legislation. The bill, entitled the Sacramento–San Joaquin Valley Emergency Water Delivery Act (HR 3964), would make changes to the Central Valley Project Improvement Act and repeal the San Joaquin River restoration program in an effort to boost water deliveries to the Central Valley. The measure also would limit enforcement or consideration of environmental regulations, including the National Environmental Policy Act and the Endangered Species Act.
Supporters of the bill maintain that quick action is needed in order to address the state’s unprecedented drought conditions. Incidentally, the legislation is expected to largely bypass committee consideration and move straight to the House floor next week.
For their part, opponents of the measure – including members from the Bay-Delta region and Senators Dianne Feinstein (D-CA) and Barbara Boxer (D-CA) – argue that the bill would undermine environmental and endangered species protections while undoing several delicately crafted water compromises. Feinstein, who has expressed her strong opposition to the House bill, is expected to introduce her own drought package in the near future.