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Tax extenders update 

While the Senate has begun the process of considering short-term extensions to the lion’s share of the 55 expiring tax provisions, the House is taking a different approach. House Ways and Means Committee Chair Dave Camp (R-MI), who had hoped to push comprehensive tax reform in this Congress, is leading an effort to make some of these provisions permanent parts of the tax code.

This effort got underway in earnest this week when The Ways and Means Committee voted to make six of the expiring tax provisions permanent, including the R&D tax credit and a provision intended to help businesses defray the cost of new equipment.

Making these six tax cuts permanent will cost $310 billion over the next 10 years. Republicans, however, aren’t proposing any pay fors, saying that extensions of current tax policy do not have to be paid for.

Democrats on the committee say Republicans are trying to have it both ways, pointing out that the GOP has demanded that any extension in unemployment insurance be paid for.

Reid may allow vote on Keystone

Republicans may get their long-awaited vote on the Keystone XL pipeline as early as next week as part of the debate over an energy efficiency bill.

Senate Majority Leader Harry Reid (D-NV) opened the door to a vote on the controversial oil-sands pipeline Tuesday as part of the debate on the Shaheen-Portman energy efficiency bill. "I'm open to anything that will move energy efficiency," Reid said in response to a question about a vote on the pipeline.

Sen. John Hoeven (R-ND), who's been at the front of the Keystone approval push, said he's been discussing a vote on congressional approval for the pipeline, not a looser sense of the Senate resolution.

Reid told reporters Tuesday that he's had conversations with Hoeven and fellow pipeline boosters Rob Portman (R-OH) and Mary Landrieu (D-LA) about pairing a Keystone vote to the energy bill. However, he left open how binding that vote could be.

A nonbinding Sense of the Senate solution—which already gathered 62 votes on last year's budget—does not seem acceptable to Republicans. In a statement, Sen. John Thune (R-SD) said: "It's easy to talk the talk, but it's time for all members to walk the walk on the Keystone XL pipeline."

Sen. Jeanne Shaheen (D-NH), one of the sponsors of the energy efficiency bill in question, said there's been no agreement yet on the amendment process for the measure, which is expected to come to the floor next week. It's unclear if the Keystone vote would be an amendment to the bill or brought up as a standalone, but Hoeven said that it must be attached to the energy bill in some form.

Click here to view the Washington Business Brief video, Busy week in DC.  

Minimum wage increase fails in Senate

On Wednesday, a bill to raise the federal minimum wage to $10.10 failed to advance in the Senate, garnering less than the 60 votes needed to move ahead. The bill failed 54-42, with Sen. Bob Corker (R-TN) the only Republican voting to advance.

Despite the failure, Democrats have pledged to continue to bring the issue up. Indeed, the minimum wage bill is one part of Democrats' 2014 election-year legislative agenda, intended to energize voters and draw a contrast between Democrats and the GOP. President Obama has been campaigning on it, and Senate Democrats have been messaging the bill for months.

While Democrats would have loved to see the bill advance, they've known its weak prospects for some time, as Senate Republicans have stood united against raising the wage to $10.10. Even Republican deal-maker Sen. Susan Collins (R-ME) failed to find enough support for her potential alternative proposal to raise the federal wage at a lower level. Senate Majority Leader Harry Reid and Sen. Tom Harkin (D-IA), the author of the legislation, have insisted they won't budge from the $10.10 level.

His proposal would raise the wage from $7.25 to $10.10 over 30 months. It would also increase the wage for tipped workers from $2.13 an hour to 70 percent of the federal minimum wage.

The Republican objection is that raising the minimum wage at that rate would cost the economy jobs. They cite a Congressional Budget Office report that it could reduce the labor force by 500,000 in 2016 (while also lifting 900,000 people out of poverty). That analysis has been challenged by Democrats.

Housing reform delayed

Prospects for housing-finance overhaul took a hit this week as the Senate Banking committee postponed a vote on a bipartisan plan.

Despite a year of bipartisan negotiations, Democrats remain divided on how to replace Fannie Mae and Freddie Mac. Senate Democrats, particularly progressives, are concerned about issues relating to lending in disadvantaged communities, the regulatory authority of any new institution and the dominance of big banks in the housing market.

The Johnson-Crapo bill, the most thorough proposal yet for remaking the housing-finance system, would replace the government-owned companies over five years with federal insurance for mortgage bonds that would kick in only after private investors were wiped out.

The Johnson-Crapo bill has the backing of six Democrats and six Republicans on the 22-member Senate Banking Committee. However, it will need more Democratic support before Senate Majority Leader Harry Reid (D-NV) will allow a vote on the floor

If there is no vote before the Senate leaves for the summer recess in July, the bill will probably die. With Johnson stepping down as chairman and control of the Senate in doubt ahead of November elections, the effort to remake the housing finance system probably would have to start over in 2015.

Net neutrality

The Federal Communications Commission (FCC) is trying to rework net-neutrality regulations after old regulations were struck down in court in January.

Speaking at the National Cable and Telecommunications Association's annual Cable Show on Wednesday, FCC Chairman Tom Wheeler reminded the industry that he has the power to reclassify broadband as a utility, which would grant his commission much stronger leverage to regulate the industry.

Wheeler said his options include "Title II," a move that would reclassify broadband as a "telecommunications service"—the same classification currently applied to telephone utilities.

Liberal advocacy groups have urged the FCC to take that step, saying it's necessary to protect the open Internet, but the commission has so far resisted that call.

Wheeler proposed net-neutrality rules last week that would allow Internet service providers to charge websites for access to special "fast lanes."

Consumer protection groups and liberal lawmakers, however, fear so-called "fast lanes" would give rich websites, like Netflix or Facebook, an unfair advantage over small websites.

Although Wheeler has limited legal options under the current authority, reclassifying broadband as a "telecommunications service" would give him expansive powers, including the ability to ban ISPs from speeding up any websites.

Wheeler emphasized that his priority is to get new net-neutrality rules in place as quickly as possible, but said he will do what's necessary to protect an open Internet.

Transportation in focus

Obama administration unveils transportation bill

This week, the Obama administration sent its first comprehensive transportation bill up to the Hill. The Generating Renewal, Opportunity and Work with Accelerated Mobility, Efficiency and Rebuilding of Infrastructure and Communities throughout America Act (GROW AMERICA Act) is a four-year $302 billion transportation bill. 

The proposal includes $199 billion for highways and road safety and $72 billion for transit. The proposal also includes $19 billion dedicated to rail, a $10 billion multi-modal freight program, $5 billion for the TIGER grant program and $4 billion for TIFIA. The draft bill also includes $87 billion to shore up the balances in the Highway Trust Fund, increases the penalty for automakers that don’t quickly recall unsafe vehicles, cuts the project approval and permitting timelines and lets states toll existing Interstate lanes to help pay for needed highway repairs.

Click here for the full text of the bill.

 

Political bits

House

California 7th Congressional District: A poll conducted for former Rep. Doug Ose's (R-CA) campaign shows Ose leading the field of Republicans (and Rep. Ami Bera (D-CA) out in front) in the top-two primary. In a primary ballot test, Bera received 43 percent, Ose 24 percent, former congressional aide Igor Birman (R-CA) 8 percent, and multi-time candidate Elizabeth Emken (R-CA) 6 percent.

Idaho 2nd Congressional District: Attorney Bryan Smith (R-ID) released a new TV ad attacking Rep. Mike Simpson (R-ID), saying his "liberal record is hard to defend." Rep. Simpson is also airing a new TV ad attacking Smith as a "debt collector" who is "looking out for himself."

Louisiana 5th Congressional District: Rep. Vance McAllister (R-LA) announced he will not run for re-election in November. McAllister was recently caught kissing a staffer on tape. House Majority Leader Eric Cantor (R-VA) asked McAllister to resign, but McAllister said he will serve out the rest of his term.

New York 11th Congressional District: Rep. Michael Grimm (R-NY) was indicted this week, in a 20-count indictment, which includes charges for tax fraud, obstruction of justice, mail fraud, wire fraud and employment of illegal immigrants. The charges relate to his time as a restaurateur – not his time in Congress.

North Carolina 3rd Congressional District: Former Alaska Governor Sarah Palin (R-AK) endorsed Taylor Griffin (R-NC) the primary challenger to Rep. Walter B. Jones, Jr. (R-NC).

Virginia 10th Congressional District: Barbara Comstock (R-VA) won the GOP nomination to succeed Rep. Frank Wolf (R-VA) over several Tea Party backed opponents. Comstock had been seen as the best hope for Republicans to hold this swing district.
         


         
Senate

Alaska: Senator Mark Begich (D-AK) said he believes there is still a chance that former Alaska Governor Sarah Palin (R-AK) enters the Republican Senate primary over the summer.

Georgia: According to a new poll, it looks likely that businessman David Perdue and Rep. Jack Kingston (R-GA) will be headed to a runoff in the race to succeed Senator Saxby Chambliss (R-GA). The poll shows Perdue at 26 percent, Kingston at 20 percent, former Secretary of State Karen Handel (R-GA) at 15 percent and Rep. Paul Broun (R-GA) at 13 percent. Perdue and Kingston have long been viewed as the most electable Republicans in this primary field.

Louisiana: Senator Mary Landrieu (D-LA) launched a new $250,000 ad touting her chairmanship of the Senate Energy Committee.

North Carolina: State House Speaker Thom Tillis (R-NC) leads his opponents in a new Public Policy Polling (PPP) poll. Tillis garners 46 percent, followed by physician Greg Brannon at 20 percent and Rev. Mark Harris at 11 percent. Tillis needs more than 40 percent to avoid a runoff. The winner will face incumbent Senator Kay Hagan (D-NC) in November.


Governor

Florida: Former Republican Gov. Charlie Crist (D-FL) leads Gov. Rick Scott (R-FL) in two new polls. A survey from Quinnipiac University has Crist up ten, 48 to 38 percent, largely unchanged from their last poll on the race in January when Crist led 46 to 38 percent. Scott's job approval rating is underwater at 42 to 50 percent, and 53 percent of respondents don't believe he deserves reelection. There's also a big gender gap in this race to the tune of 18 points: Crist leads Scott 51 to 33 percent among women. A SurveyUSA/WFLA-TV poll has the race much closer, Crist runs within the margin of error over Scott 44 to 41 percent.

Maine: A new Rasmussen poll out Wednesday has Gov. Paul LePage (R-ME) tied at 40 percent with Rep. Michael Michaud (D-ME) and 2010 candidate Eliot Cutler (I-ME) trailing with 14 percent. LePage is considered one of the most endangered Republican Governors in the country.

 

A look ahead

House

Thursday, May 8 – The House Veterans' Affairs Committee will hold a hearing on Defining and Improving Success for Student Veterans  at 10:00 a.m. in 334 Cannon.

Senate

Tuesday, May 6 – The Senate Finance Committee will hold a hearing on New Routes for Funding and Financing Highways and Transit at 10:00 a.m. in 215 Dirksen.

Tuesday, May 6 – The Senate Foreign Relations Committee will hold a hearing on Ukraine - Countering Russian Intervention and Supporting a Democratic State at 3:00 p.m. in 419 Dirksen.

Tuesday, May 6 – The Senate Budget Committee will hold a hearing on President Obama's proposed FY2015 budget request for education at 10:30 a.m. in 608 Dirksen.

Wednesday, May 7 – The Joint Economic Committee will hold a hearing on The Economic Outlook at 10:00 a.m. in 216 Hart.
          

Washington by the numbers                        

$24.6 million - 2013 compensation for Twitter CFO Mike Gupta.

46 percent - Percentage of Army combat brigades that would be reduced if federal sequestration cuts continue, according to the Army.

They said what?

"There aren't a lot of things that get past me. So when people tell me that we should send more of the same type of leadership to Washington, I say no, no, no." -- Former NBA All-Star Dikembe Mutombo, endorsing Georgia Senate candidate Michelle Nunn (Atlanta Journal-Constitution)

Washington humor

"The Christian Science Monitor is claiming 'Hillary Clinton will be a tad less interested in running for president now that she's about to be a grandmother.' And if you put a grain of sand in your pocket there's a tad less sand on the beach." –Seth Meyers  
           

 

 

 

  

 

 Steven C. LaTourette, President | 202.559.2600

McDonald Hopkins Government Strategies LLC
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www.mcdonaldhopkinsgs.com

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