Federal Update - Budget Resolution and Tax Reform Week

This week the House and Senate were in session, with the Senate voting to approve the latest disaster relief package and the House voting today to narrowly approve, by a vote of 216-212, the Senate passed Budget Resolution (H.Con.Res. 71) that will position Congress to move forward with comprehensive tax reform. ABC key voted the budget resolution, you can view a copy of the letter here.

The disaster relief package provides $36.5 billion to help residents of Puerto Rico, Florida and Texas and includes $16 billion in debt forgiveness for the National Flood Insurance Program. The President is expected to sign the bill, which has already passed the House.

The budget resolution allows for tax cuts of $1.5 trillion, requiring approximately $4 trillion in offsets to adhere to the overall plan that is expected to cost nearly $5.5 trillion. One of the most highly reported revenue sources has been the state and local tax (SALT) deduction, which, if eliminated, would result in an estimated $1.3 trillion of tax revenue over the next ten years. However, this idea has received significant pushback from Republicans representing these high-taxed districts that rely on the SALT deduction and is seen as one of the main reasons for 20 House Republicans voting against today’s budget resolution.

The devil, though, remains in the details, and with passage of a budget resolution, the House plans to release their tax bill on November 1st and hope to finish tax reform by the end of the year. Some have called the year-end deadline “ambitious” but we will continue provide additional updates on the legislative language and progress of tax reform in Congress.

Moving forward into November, Congress is faced with a number of issues, including funding the government past the December 8th deadline that currently looms.

Democrats have pushed to include a solution to address the status of the so-called DREAMers in any year-end spending bill as a result of the President Trump’s repeal of the Obama administration’s Deferred Action for Childhood Arrivals (DACA) policy that allowed over 700,000 undocumented immigrants to live, work and study in the United States. Two proposals have been issued to address this issue from both Democrats and Republicans and Speaker Ryan this week told Members of Congress that he plans to include a legislative fix to the DACA issue in the year-end spending deal.

Also, on the immigration front, the House Judiciary Committee held a hearing to mark-up of H.R. 3711, the Legal Workforce Act, which requires an improved E-Verify program on all employers and for all new hires. ABC supports this legislation and previously wrote a letter to the House Judiciary Committee on the bill as part of the Essential Worker Immigration Coalition (EWIC).

In health care news, as you may recall from last week, Senators Lamar Alexander and Patty Murray announced an agreement on a bipartisan Obamacare deal to fund a key insurance subsidy program and provide states some flexibility around parts of the health care law. However, this plan was panned by Speaker Ryan and House Republicans who called the proposal a “nonstarter.” A new, conservative proposal was issued by House Ways and Means Chairman Kevin Brady (R-TX) and Senate Finance Committee Chairman Orrin Hatch (R-UT). You can find more information on their four point proposal here, and we will continue to keep you updated on any new developments.

Finally, some recent announcements and departures from Congress. Late last week, Rep. Tim Murphy (R-PA-18) officially left his seat in Congress and Rep. Pat Tiberi (R-OH-12) announced that he would be retiring from Congress and leaving his seat by January 31, 2018, and will serve as the new head of the Ohio Business Roundtable. On Tuesday, Senator Jeff Flake (R-AZ) also decided that he will not seek reelection and will retire at the end of his term in January 2019.