Friday, April 24, 2009

 

This Week in Washington - 4/24/09

Congress named its conferees to the budget resolution yesterday and could finish work on the budget resolution next week. The Administration has indicated it could send up its detailed budget request the first week in May, which should help jumpstart the appropriations process.

BUDGET CONFERENCE

Congressional Quarterly is reporting that a tentative deal has been reached between the House and Senate on a final budget resolution that includes reconciliation instructions for health care and student aid and that cuts $10 billion from the President’s discretionary levels. (The House had cut discretionary funding by $7 billion below the President, the Senate had cut $15 billion.) CQ is also reporting that a formal conference meeting will be held on Monday, April 27. If that happens, we can expect the final resolutions to be taken up in the House and Senate during the course of the week.

The House named the following members to be conferees on the budget resolution: Budget Chairman Spratt (D-SC), ranking member Paul Ryan (R-WI), and Reps. Allen Boyd (D-FL), Rosa DeLauro (D-CT), and Jeb Hensarling (R-TX). The House also defeated a motion to instruct conferees to drop the budget reconciliation instructions from the final resolution. The vote was 227 to 196.

The Senate also named conferees after taking a series of votes on several procedural motions. The conferees are Budget Chairman Conrad (D-ND), ranking member Gregg (R-NH), and Sen. Murray (D-WA).

ESTATE TAX

It appears increasingly likely Congress will wait to take up tax legislation to address the 2001/2003 “middle class” tax cuts, AMT, and the refundable credits until next year. This could change, particularly if the debate on health care bogs down. But we remain concerned about the prospects for enacting a one-year extension of the 2009 parameters of the estate tax should the larger tax debate indeed be put off.

To review: enacting a one-year extension to the estate tax could require 60 votes in the Senate, which could be difficult after the vote on the Lincoln-Kyl amendment during the budget resolution. Estate tax supporters are likely to push adopting the Lincoln-Kyl parameters for one year as a “compromise” instead of the 2009 levels. (The Lincoln-Kyl amendment increased the exemptions to $10 million per couple/$5 million per individual and reduced the tax rate to 35 percent.)

Proponents have leverage because, unless 60 votes can be produced for any proposal, the default will be that the estate tax will be completely eliminated in 2010, which they would prefer. Allowing either the Lincoln-Kyl parameters to be adopted for one year or the estate tax to disappear in 2010 would make it more difficult to restore the 2009 parameters as part of a broader tax bill because many members on both sides of the aisle will not want to be perceived as voting for a tax increase.


HEALTH CARE
Action is well underway to structure components of health reform legislation for consideration this summer. Committee chairmen in both the House and Senate are working to have bills ready for committee mark-ups following Memorial Day with floor debate after the July 4th recess.

In the Senate, the HELP and Finance Committees are expected to produce separate bills that will be combined on the Senate floor. Finance Chairman Baucus and Ranking Member Grassley hope to drill down on a number of key issues during a series of health reform roundtables for committee members and health experts, which kicked off on Tuesday. They will focus on three areas: delivery system reform, coverage, and financing.

In the House, the chairmen of the Energy and Commerce Committee, the Ways and Means Committee, and the Education and Labor Committee have pledged to work together on health reform legislation that is expected to follow a similar timetable as the Senate legislation. (Although the public focus of the Energy and Commerce Committee this month has been on climate change legislation, intense behind the scenes work on health reform is well underway.)

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