Congress will work all week to wrap up the end of the year legislation with the hopes that the first session of the 112th Congress can conclude by weeks end.
This will require both the House and the Senate to pass an extension of the payroll tax holiday provision along with other expiring tax provisions, as well as passing another stopgap appropriations spending bill to fund our federal government into next year. Also, expect Congress to enact the Department of Defense authorization bill before the membersleave for the Christmas holiday season.
The Senate will be considering a constitutional amendment requiring the federal government to balance their budget in the middle of the week while awaiting House action on the payroll tax holiday bill and the omnibus appropriations bill. The balanced budget proposal requires two-thirds of the Senate present and voting to vote in the affirmative. Most Hill watchers believe that the Senate will fail to pass the constitutional amendment. By the time the Senate conducts that vote, they expect to have the tax holiday bill, HR 3606, sitting in their chamber for Senate consideration.
This new payroll tax holiday proposal is expected to be passed in the House on Tuesday following a 5:30 p.m. Rules Committee meeting on Monday. The leadership is asking the Rules Committee to report out HR 3606 and provide that the House floor debate restrict any amendments. Assuming the House successfully passes the tax holiday bill, they expect to then pass the omnibus appropriations bill which will continue the funding of our federal government well into next year. The House is then expected to pass the Department of Defense authorization bill. All of this will land in the Senate chamber by midweek leaving the final work in the hands of the United States Senate.
The highlights of the payroll tax holiday bill are as follows:
- Extends the current lower payroll tax for employees for one year.
- Extends unemployment benefits and scales them back.
- Allows states, if they desire, to perform drug screening as a condition of providing unemployment insurance benefits.
- Approval of the application of the Keystone pipeline within 60 days.
- Includes the EPA Regulatory Relief Act, HR 2250, passed by the House on Oct. 13.
- Includes spectrum auctions to advance wireless broadband service.
The offsets for the cost of the bill are as follows:
- Extends the current pay freeze for federal workers (including members of Congress) through fiscal year 2013 (saves $26 billion).
- Changes the co-pay structure for civilian federal retirees (saves $36 billion).
- Raises Government Sponsored Enterprise (GSE) guarantee fees (saves $38 billion).
- Includes spectrum auctions (saves $16 billion).
- Reforms the National Flood Insurance Program by eliminating the premium subsidy for certain properties (saves $4 billion).
- Better coordinates with states and localities to prevent Social Security overpayments (saves $3 billion).
- Ensures that illegal immigrants who are not eligible to work in the U.S. do not get checks from the IRS (saves $9.4 billion).
- Gradually increases Medicare premiums for high-income beneficiaries (saves $31 billion).
- Prohibits millionaires from receiving unemployment insurance and Food Stamp benefits (saves $20 million).
Stay tuned to see how this week ends in Congress.
Elizabeth B. Letchworth is a retired, elected United States Senate secretary for the majority and minority. Currently she is a senior legislative adviser for Covington & Burling, LLC and is the founder of GradeGov.com (http://www.gradegov.com)