Government Relations: Holiday Update

Certainty is always desirable, but perhaps never more than during the holiday season. Unfortunately, at the moment, there is little in Washington that we can be sure of. Funding the government, in particular, remains in a state of flux.

Funding the Government

You may recall that Congress passed a continuing resolution (CR) to fund the federal government until December 8 and then another to fund it through December 22. Presumably, the idea was that Members of Congress would rush to complete work on funding so they could spend time with their families during the holidays. With one week to go before the current CR expires, it is obvious that there will need to be at least one more CR --   this one to fund the government through the first few weeks of January 2018.

House Republicans have circulated a proposed bill to keep the government running after this continuing resolution (CR) expires next week. The proposed legislation would extend current funding levels for virtually all non-defense programs until January 19, 2018, while providing a $73 billion increase for defense spending. This level is far above the existing sequester-level cap for defense and would violate the Budget Control Act. 

It also funds the Children's Health Insurance Program (CHIP), although the Center on Budget and Policy Priorities reports, "The spending package includes a harmful provision ... that would take insurance away from up to 688,000 low- and moderate-income people each year who miss a premium payment for marketplace coverage. It would also deeply cut the Affordable Care Act's Prevention and Public Health Fund, which provides essential support for Centers for Disease Control and Prevention programs in areas such as responding to infectious disease outbreaks, reducing tobacco use, and immunizing children."

The proposal is a non-starter for Democrats, who oppose it for many reasons. Of particular importance to us is that it does not lift the non-defense discretionary (NDD) cap or fund NDD programs for the full year, breaking the principle of parity between defense and non-defense spending that Democrats have insisted on.

Nor does the House Republican proposal contain a fix for Deferred Action for Childhood Arrivals (DACA) Dreamers or disaster relief--- both items that different Congressional constituencies have insisted be included in a year-end funding bill. 

Now that it seems that Congress will pass the tax bill, it is possible that the House will pass this bill next week --- likely without any Democratic support --- after it acts on taxes. Even if this bill can pass the House, it would take 60 votes in the Senate to pass this CR, and the votes are not there to pass this bill because Senate Democrats, and some Republicans, are likely to oppose the bill.

There are a number of possible scenarios of what could happen next, but Senate Majority Leader McConnell is on record that there will not be a government shutdown. Earlier this week he said, "There isn't any chance we are going to shut the government down. We're in discussions, not only on a cap deal, but also on the way forward on appropriations. The American people need not worry that there is going to be any kind of government shutdown." For his part, Senate Minority Leader Schumer was quoted as saying, "Democrats will oppose any budget deal that would allow defense spending to increase while holding down domestic priorities."

In short, it is clear that there will need to be another CR after December 22 and further action in 2018, but it's not clear what the next steps will be. Eventually, an increase in both the defense and non-defense caps is likely. Whether the principle of parity is retained also remains to be determined.

Other Legislation

As of this writing, it appears that there will be a tax bill that Congress will pass. Its contents are not yet completely known, but rumors are that some of the items that were deemed most harmful to education have either been dropped or modified.

Higher Education Act Reauthorization

The House Education and Workforce Committee reported out a Higher Education Act Reauthorization (called the PROSPER Act) along party lines.

PROSPER stands for Promoting Real Opportunity, Success, and Prosperity Through Education Reform.

Higher Education Community is largely united in its opposition to the bill arguing that overall the proposals would make higher education more expensive for students and families and significantly change federal higher education policy. The bill cuts programs, restructures policies, and imposes new regulations that many argue are harmful to students and families. 

Among the programs slated for elimination or reduction: 

  • The in-school interest subsidy for undergraduate students 
  • The Supplemental Educational Opportunity Grant program 
  • Loan forgiveness and other benefits currently available in the student loan programs 
  • Title III-A Strengthening Institutions Program
  • The Teacher Quality Partnership Grants program reduced by $50 million

Graduate students would be hit hard, losing Federal work-study eligibility and having their federal graduate loans limited, forcing them to borrow at higher costs and with fewer protections in the private market. 

Among the PROSPER Act provisions the associations support, the legislation would provide a bonus to Pell Grant recipients to incentivize completion, simplify the process of applying for federal aid, eliminate origination fees on student loans, provide statutory authority to accreditors to use risk-based or differentiated accreditation procedures, and provide institutions the authority to limit borrowing. 

The bill does strive to reduce unnecessary or duplicative regulations on students and institutions. However, these proposals are offset by other changes that would add burden and complexity, such as requiring weekly or monthly disbursements of student aid. 

This bill will not come up for a vote this year. The consensus is that the real action is in the Senate, which has not yet produced a bill. 

Best wishes to all for a happy, healthy, and peaceful holiday season and New Year.