MEMORANDUM To: ABA Board of Directors From: Suzanne Rohde, ABA Vice President for Government Affairs and Policy Re: September 2017 Government Affairs and Policy Board Report Date: September 5, 2017 I. OVERVIEW The following report provides an update on Government Affairs and Policy Division (GAP) activities since the last board report, dated April 12, 2017. It is organized around Legislative, Executive and Operations activities undertaken by GAP during this time period, on behalf of the American Bus Association. II. LEGISLATIVE A. NOMINATIONS Congress and the Administration continue to make progress on nominations to fill presidentially appointed positions for executive branch agencies. As of mid-July, all cabinet-level positions were confirmed; however, on July 28 th , the President named Secretary of Homeland Security General John Kelly as his new Chief of Staff, once again creating a vacancy at the Department of Homeland Security. An updated list of appointments and confirmations is attached. Just a brief note regarding nominations at the USDOT. Prior to August recess, the Senate did a mass push of voting out nominations, and confirmed Robert Sumwalt to be a member and chairman of the National Transportation Safety Board, Mark Buzby to be administrator of Maritime Administration, and David Pekoske to be TSA administrator. However, several DOT nominees were held up, including Steven Bradbury to be DOT general counsel, Ron Batory to be FRA administrator, Derek Kan to be undersecretary of Transportation for Policy and Adam Sullivan to be assistant secretary for governmental affairs. Although these nominations were ready for a vote, a hold was placed on them due to regional politics concerning funding for a large transportation project in New York known as the Gateway Program. The votes to confirm these nominations may occur this fall, when the Senate is back in session. B. LEGISLATION 1. Appropriations a. FY 2017 In May, after passing a week long Continuing Resolution (CR) to extend the April 29 deadline established by the previous CR to allow more time for negotiations, both chambers of Congress passed a $1.1 trillion omnibus appropriations package funding the federal government through September 30, 2017, the end of the fiscal year. The legislation was signed into law on May 5th,
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MEMORANDUM
To: ABA Board of Directors
From: Suzanne Rohde, ABA Vice President for Government Affairs and Policy
Re: September 2017 Government Affairs and Policy Board Report
Date: September 5, 2017
I. OVERVIEW
The following report provides an update on Government Affairs and Policy Division (GAP)
activities since the last board report, dated April 12, 2017. It is organized around Legislative,
Executive and Operations activities undertaken by GAP during this time period, on behalf of the
American Bus Association.
II. LEGISLATIVE
A. NOMINATIONS
Congress and the Administration continue to make progress on nominations to fill presidentially
appointed positions for executive branch agencies. As of mid-July, all cabinet-level positions were
confirmed; however, on July 28th, the President named Secretary of Homeland Security General
John Kelly as his new Chief of Staff, once again creating a vacancy at the Department of Homeland
Security. An updated list of appointments and confirmations is attached. Just a brief note
regarding nominations at the USDOT. Prior to August recess, the Senate did a mass push of
voting out nominations, and confirmed Robert Sumwalt to be a member and chairman of the
National Transportation Safety Board, Mark Buzby to be administrator of Maritime
Administration, and David Pekoske to be TSA administrator. However, several DOT nominees
were held up, including Steven Bradbury to be DOT general counsel, Ron Batory to be FRA
administrator, Derek Kan to be undersecretary of Transportation for Policy and Adam Sullivan to
be assistant secretary for governmental affairs. Although these nominations were ready for a vote,
a hold was placed on them due to regional politics concerning funding for a large transportation
project in New York known as the Gateway Program. The votes to confirm these nominations
may occur this fall, when the Senate is back in session.
B. LEGISLATION
1. Appropriations
a. FY 2017
In May, after passing a week long Continuing Resolution (CR) to extend the April 29 deadline
established by the previous CR to allow more time for negotiations, both chambers of Congress
passed a $1.1 trillion omnibus appropriations package funding the federal government through
September 30, 2017, the end of the fiscal year. The legislation was signed into law on May 5th,
averting a government shutdown. Through aggressive lobbying efforts by GAP, the omnibus
package did include funding for the Intercity Bus Security Grant Program; however, Congress
reduced it to $2 million from the Senate’s original mark of $3 million. Candidly, GAP’s advocacy
to continue funding for the program faces strong resistance, both in the House and Senate. As to
distribution of the $2 million in FY 2017 funding, due to the delay in passing an omnibus measure,
the Transportation Security Administration (TSA)/Federal Emergency Management
Administration (FEMA) managed an expedited application process that closed on June 22. The
announcement of grant awards was made on September 1, 2017. The overall number of award
recipients was considerably down this year, with only 18 companies receiving awards (compared
with 90, in 2016).
Also noteworthy, the omnibus legislation did not include language restricting the Federal Motor
Carrier Safety Administration (FMCSA) from moving forward on its Safety Fitness Determination
rule; however, the agency had formally withdrawn the rule in March, prior to enactment of the
omnibus. Also, the legislation did not include language to establish federal preemption over hours
of service, to render current the California “meal & rest break” law preempted. This is a
controversial issue with the challenge being led by the American Trucking Association with
ABA’s support. However, ABA supported language concerning the FMCSA lease & interchange
rule did survive, as it was included in both the House and Senate appropriations bill reports.
b. FY 2018
While the FY 2017 omnibus negotiations were underway, Congressional appropriations
committees also attempted to move forward with the FY 2018 funding process, under “regular
order.” However, with a new presidential administration, details of a formal budget request from
the Administration were delayed until May 23. Then, once the request was submitted, many in
Congress found it to be unrealistic in terms of funding priorities and proposed cuts. Also
challenging the effort for “regular order” was the wrangling over passing a budget resolution,
legislation Congress uses to set the levels for discretionary spending for the 12 appropriations bills.
Nonetheless, House appropriations committees held hearings and marked up all 12 appropriations
bills by mid-July, cramming what usually is about a 7-8-month process into about 3-weeks. After
discussing the possibility of packaging all 12 bills into an omnibus measure to pass before August
recess, which faltered due to Republican interest moving it with only Republican support, the
House settled for passing a small “national defense” mini-bus package of 4 of bills (Legislative
Branch, Energy-Water, Defense and Military Construction) before leaving for recess on July 28.
The Senate was not as aggressive, completing the committee process for only 6 bills before August
recess, even though it remained in session an additional two weeks into the month. For September,
the House plans to move the remaining 8 bills in a larger mini-bus package, prior to the end of the
fiscal year. However, the Senate is considerably behind in moving appropriations bills and there
is significant resistance to the House-version of many of the bills, due to a number of controversial
provisions including cuts to discretionary programs and increases to defense spending. It is
unlikely a funding package for FY 2018 will pass prior to September 30, and members are
discussing the likelihood of a CR, although its term is unclear at this point. Most expect that the
CR will fund the government through the end of the calendar year, so while we may not be worried
about a government shutdown at the end of September, there could be one at the end of December.
Further, now in the wake of Hurricane Harvey, emergency relief funding will likely play a
significant role in FY 2018 funding decisions. In short, September will be a challenging month in
the federal legislature.
During the summer, as part of the FY 2018 appropriations process, GAP aggressively engaged in
support of two key ABA objectives: stopping the Federal Motor Carrier Safety Administration
(FMCSA) lease and interchange rule (L&I rule); and funding for the IBSGP. In terms of the L&I
rule, GAP was again successful in working with both House and Senate appropriators to obtain
inclusion of language in the transportation appropriations bill reports. However, efforts to obtain
continued funding for the IBSGP were not as successful. The House appropriations committee
declined to include funding for the program in its homeland security appropriations measure (this
is one of the 8 remaining bills expected to be brought to the floor in September). Congressman
Dent (PA) conducted outreach on our behalf to the committee, and raised the issue at the mark-up
for the bill. As well, several ABA members and representatives joined GAP in conducting direct
outreach to specific House members, including the chairman of the House appropriations
committee Congressman Frelinghuysen (R-NJ). We also elicited support from the U.S. Travel
Association, as part of our broader effort to work with organization on travel related issues. Since
the House mark-up, GAP has concentrated its efforts on the Senate side, continuing outreach to
key offices, working with the Transportation Security Administration on data to support the
funding request, and coordinating with various ABA members on Senator outreach. We were
successful in facilitating the re-introduction of legislation in the House to reauthorize the IBSGP,
by Congressman Lipinski (D-IL) and Congresswoman Comstock (R-VA). We also gained support
for funding the program, including interest in legislation to reauthorize it, from Senator Shaheen
(D-NH), a member of the Senate homeland security appropriations subcommittee. This support is
in addition to support we received from senators Blunt, Hoeven, and Baldwin, all members of the
Senate appropriations committee. In late July, GAP also learned of a letter sent to the homeland
security appropriations leadership from Senator Durbin, a ranking member in Senate leadership,
along with a contingent of over 30 Democrat Senators, urging robust funding of the transportation
grant programs, including the IBSGP. Aside from the appropriators, GAP also engaged in efforts
to work with Senator Johnson’s (R-WI) office, both directly and through ABA members, due to
his role as chairman of the Senate Homeland Security Committee and based on his prior criticism
of the program with Senator Flake (R-AZ). Because of the Johnson/Flake previous identification
of the IBSGP as wasteful, we continue to face an uphill battle to obtain funding. The GAP team,
with assistance from ABA members and member representatives, remain in close touch with the
offices of senators Blunt, Hoeven, Baldwin and Manchin, and plan to continue seeking support for
the program in the Senate, as we head toward final funding negotiations this fall and building long
term support for the program. We are currently targeting other members of the Senate
Appropriations Committee, including senators Boozeman (R-AL), Collins (R-ME), Shelby (R-
AL), Murkowski (R-AK). However, as we stay engaged in the entire appropriations process, we
are hearing from staff of significant pressure to find ways to reduce spending and cut programs.
Also noteworthy, the FY 2018 financial services appropriations bill passed by the House contains
language prohibiting the Internal Revenue Services (IRS) from finalizing and implementing the
estate and gift tax valuation discounts changes, opposed by ABA. Working with the Family
Business Coalition, GAP has remained vigilant in opposing this rulemaking. Finally, federal
funding for Brand USA, which GAP included in its appropriations advocacy efforts, was retained
in the FY 2018 appropriations despite the Administration’s proposal to redirect the funding to
border security.
2. Tax
Although tax reform continues to be identified as a high priority for the Trump Administration and
the Republican Congress, the past several months demonstrated, like other Republican priorities,
Republicans are not united on this issue. Initially, tax reform was relegated to second place in
terms of priorities, while Republicans attempted to keep campaign promises to repeal/replace the
Affordable Care Act. However, by August, although the House did eventually pass legislation, it
became clear the Republican controlled Congress and Administration have not found a way to
keep this promise. This outcome makes success on tax reform even more urgent for Republicans,
as they need a victory going into the 2018 mid-term elections. Thus, to avoid the pitfalls of the
ACA repeal/replace effort the Administration and Republican Congressional leadership are
working more closely together, and they may scale back on the level of ambition. Further
complicating things, Republicans had hoped to use the money saved by passing Obamacare repeal
and replace to help pay for tax reform, but now they do not have those savings.
Over the course of the summer, while the ACA repeal/replace effort floundered, the
Administration and Republican leadership spoke of turning attention to tax reform, and to some
degree this occurred but without producing an agreed upon product. The House tax writing
committee began holding hearings on tax reform in the spring; while the Senate tax writers held
their first hearing on July 18. Yet, the real work on the issue is being done through the “Gang of
Six,” a group comprising House Speaker Ryan (R-WI), House Ways and Means Committee Chair