Nooley Reinheardt & Associates
Providing Government Relations and
Public Affairs Strategies Since 1981
December 17, 2014
WASHINGTON REPORT
The tax extenders bill a chairman couldn’t love, or even like,passed the Senate Tuesday 76-16 as the Senate joined the House in declaring victory and calling it quits with the 113th Congress. The 114th Congress convenes on January 6.
The $42 billion extenders legislation, which continues 50 or so expired or expiring provisions through the end of December but not prospectively for 2015, goes to the president who will sign the legislation. Among the 16 Senators votingagainst the House bill was Senate Finance Chairman Ron Wyden (D-Oregon). The minimum nine percent credit, which is of no benefit at this point, is included in the package.
Chairman Wyden and a majority of the Senate wanted the two-year, $85 billion bipartisan bill that the Finance Committee reported last April, but the House balked at the two-year deal and the Senate leadership did not have the appetite for a final-hour battle. A White House veto threat and objections from many liberal Senate Democrats a couple of weeks ago squashed a $400 billion deal between Senate Democratic Leader Harry Reid (D-Nevada) and departing Ways and Means Chairman Dave Camp (R-Michigan) which would have made some provisions permanent and extended others for two years.
The new year seems to offer another year of tax extender hell as any action will probably have to wait while the Administration and incoming tax writing chairs Senator Orrin Hatch (R-Utah) and Paul Ryan (R-Wisconsin) spare and posture over tax reform.
In the final days, Congress also agreed to fund most agencies for the reminder of fiscal 2015 which ends September 30. The $1.1 trillion omnibus spending package makes small cuts in most HUD and USDA programs, with HOME taking a direct $100 million hit, putting it at its lowest funding level ever.
The omnibus deal also authorizes an increase in the number of units eligible for the HUD Rental Assistance Demonstration program (RAD) from 60,000 to 185,000 units. Notable is the fact that California Democrat Representative Maxine Waters, the ranking member of the Financial Services Committee, has asked the Obama administration to “rethink” its support of RAD which allows the conversion of public housing units.
NOW, some notes of interest.
In the final days, Chairman Camp took his working draft of tax reform and introduced it as H.R. 1 – the coveted bill number which was reserved for tax reform at the start of the 113th Congress in January of 2013. All pending legislation dies at the end of a two-year Congress, so Mr. Camp’s bill is only a marker, and part of his legacy. But most of us would have preferred that it not be formally introduced.
On the Ways and Means Committee, Representative Dave Reichert (R-Washington) will succeed Representative Pat Tiberi (R-Ohio) as chair of the Select Revenue Measures Subcommittee, whose jurisdiction includes tax policy. Mr. Tiberi, the lead sponsor and advocate for our nine and percent legislation, moves to chair the Trade Subcommittee. Mr. Reichert, however, is also one of the cosponsors of the measure making the minimum rates permanent.
New to the Ways and Means panel in the 114th are Representatives: Pat Meehan (R-Pennsylvania), Kristi Noem (R- South Dakota), Jason Smith (R-Missouri), and George Holding (R-North Carolina). Of the four, only Mr. Smith is a cosponsor of the permanent minimum rate legislation.
None of the three new Republicans on the Senate Finance Committee are co-sponsors of our legislation. The three Senators—Dan Coats (Indiana), Dean Heller (Nevada), and Tim Scott (South Carolina).
Democrats, because of the flip of control of the Senate, lost one seat on Finance, but retiring (by choice) Senator Jay Rockefeller (West Virginia), a cosponsor, just will not be replaced.
Please remember, we have numerous supporters of the LIHTC and our legislation who, for one reason or another, are not cosponsors.
There are two other changes of committee chairmanships relevant to our interest. On the Financial Services Committee (whose jurisdiction includes HUD and USDA housing programs), Rep. Blaine Luetkemeyer (R-Missouri) replaces Rep. RandyNeugebauer (R-Texas) as chairman of the Housing and Insurance Subcommittee.
On the Appropriations Committee, Rep. Mario Diaz-Balart (R-Florida) will assume the chairmanship of the Subcommittee on Transportation-HUD (THUD).
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Former North Carolina Congressman Mel Watt, now Director of the Federal Housing Finance Agency (FHFA), has directed Fannie Mae and Freddie Mac to begin funding the National Housing Trust Fund and the Capital Magnet Fund. Both were created by the Housing and Economic Recovery Act of 2008 and were to be funded by profits from the two GSEs. This, of course, was before the $200 billion “bailout” of the housing giants which put the funding on hold. Each year the Obama Administration has called for a $1 billion authorization for the Trust.
HUD describes the Housing Trust as a major production program where 80 percent of the resources will go to rental housing efforts. More details to come.
Financial Services Committee Chairman Representative Jeb Hensarling (R-Texas) immediately attached the decision calling it a “grave mistake that harms hard working taxpayers and violates both the letter and spirit of the law.”
The chairman continued “…decision to activate the Fannie and Freddie slush fund may be an early Christmas present for Acorn-like liberal housing activists, but it’s a lump of coal in the stocking of every American taxpayer.”
Mr. Hensarling said his committee will hold early 2015 oversight hearings on the decision by Director Watt.
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And, finally, if you were wondering, House Majority Leader Kevin McCarthy (R-California) says the House is scheduled to be in session 132 days in 2015, with no five-day work weeks. The Senate is expected to clock more time in session.
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