Proposed grant funding for COVID-19

The CARES Act includes funding for specific departments and agencies as described below. Details on the disbursement of these funds are not yet available but check back here for more information. We expect these programs to run applications through grants.gov.

  • $20.5 million for the USDA Rural Business Cooperative Service – provides $1 billion in lending authority available for the Business and Industry loan guarantee program, which provides financing to business owners that might not be able to qualify for a loan on their own;
  • $1.5 billion for the Economic Development Administration – funding to support economic development grants for states and communities suffering economic injury as a result of COVID-19;
  • $31.1 billion for the Department of Transportation (DOT) – funding included for the Federal Aviation Administration, Airport Improvement Program, Essential Air Service, Federal Highway Administration, Federal Transit Administration Transit Infrastructure Grants, and Amtrak;
  • $4.3 billion for the Centers for Disease Control (CDC) – funding for public health preparedness and response which includes direct funding to state and local public health responders as well as State and Local Preparedness Grants;
  • $45 billion for the Federal Emergency Management Administration (FEMA) – funding to continue FEMA’s entire suite of response and recovery activities and reimbursements provided to states and localities nationwide by the Disaster Relief Fund.

Additional information will be circulated once it become available.

A must-pass Fall for Congress

To say Congress has a full plate as it returned to work this week doesn’t do the plate justice.

The August recess was, at best, tempestuous, as divisions between President Donald Trump, his party and, in particular, his party’s leaders were laid bare in his Twitter feed.

Hurricane Harvey’s historic devastation, and cost to clean up and rebuild, is just now coming into focus. And as members of Congress were packing their bags to return to Washington, the president gave them six months to address another highly emotional issue: his planned phase-out of DACA, which protects immigrants who were brought into the United States as children.

And while the GOP’s Affordable Care Act repeal-and-replace efforts were stymied in June, the Senate HELP Committee picks up the ball and will begin hearings on stabilizing the Obamacare markets—while the president threatens to withhold market stabilization payments.

On the foreign policy front, North Korea’s nuclear missile program has prompted a powerful response from Secretary of Defense Jim Mattis, who in blunt language warned Kim Jong-un of total annihilation. Meanwhile, Venezuela teeters on the brink; ISIS, though facing setbacks, continues to fight; and, breaking with his campaign rhetoric, the president has decided to send more troops into Afghanistan.

Congress faces a list of must-pass bills. Here, Dentons’ Public Policy and Regulation Practice dives deep into the marquee issues awaiting the attention of Congress and the administration:

Congress seeks elusive consensus before summer recess

Barring cancellation of a portion or all of the scheduled summer recess—an event not currently expected despite the requests of several Republican senators and House members, as well as conservative media personalities—the House, when it returns for legislative business on July 11, will be in session for only 13 days before leaving on July 28, not to return till September 5. The Senate returns a day earlier, on July 10, and is scheduled to be in session for 15 days before also leaving for summer recess on July 28 and returning on September 5.

Below is an overview of some of the matters that may receive Congressional consideration before the end of July and our assessment of their current prospects.

Health care reform legislation

Senate GOP leadership decided on June 27 to delay consideration of the Better Care Reconciliation Act (BCRA), their proposed legislation to repeal and replace Obamacare. After several GOP senators stated their opposition to the BCRA draft, Senate Majority Leader Mitch McConnell (R-KY) was short of the votes he needed to bring the bill to the Senate floor. He has now spent his 4th of July holiday on the very challenging task of threading the needle and making changes to the BCRA that can win the votes of 50 Republican Senators to bring such health care legislation to the Senate floor and pass it.

To do so, Leader McConnell must address the concerns of conservative Republican Senators who say that the current version of the BCRA does not repeal and replace enough of the Affordable Care Act. At the same time, Leader McConnell also must be responsive to those moderate Republican Senators who say, among other things, that the cuts to Medicaid under the bill ($772 billion) are far too severe.   In addition, the CBO score that the bill would result in an estimated 22 million additional uninsured persons by 2026 is an attention-grabbing headline that has stoked public opposition to the bill.

Leader McConnell wants to bring a revised repeal-and-replace bill to the floor as soon as possible after the July 4th recess   The Congressional Budget Office is currently reviewing legislative language sent by Leader McConnell and will score the fiscal impact of these potential changes to the BCRA bill. The Senate parliamentarian will also have to consider whether these proposed changes can properly be raised in a reconciliation bill. These factors are likely to push any roll call on a revised BCRA bill to the last half of July, either during the weeks of July 17 or July 24, rather than immediately after the July 4 recess.

It currently seems as if any overture that Leader McConnell makes to either the conservative or more moderate wings of his Conference in an effort to win votes for the bill threatens the willingness of the other wing to support it. The key open question is whether Leader McConnell, an extremely skilled legislative tactician and veteran horse trader, can craft a compromise that will attract enough votes from both conservative and moderate Republican Senators to get to 50 votes.

The passage, or the abandonment, of Affordable Care Act (ACA) repeal-and-replace legislation, and when these events occur, is likely to have an enormous impact on the timing, the terms, and the likelihood of success for many key elements of the Republican legislative agenda. If the status of ACA repeal-and-replace legislation is not resolved until the final week in July, it surely will delay consideration of many of the subjects that Congressional Republicans hoped to consider before leaving at the end of July for their summer recess.

FY18 budget resolution

Because adoption of a fiscal year 2018 budget resolution will vitiate the reconciliation process of the FY17 budget resolution under which ACA repeal-and-replace legislation currently is being considered, the House will not adopt an FY18 budget resolution until it is definitively determined whether ACA repeal-and-replace legislation can be enacted through use of the reconciliation process.

House Budget Committee Chair Diane Black (R-TN) has been unable to finalize a budget because conservatives are demanding huge cuts to mandatory programs, such as food stamps. No agreement presently exists on how to spread the pain of the $200 billion in mandatory spending cuts (down from $500 billion in Chairman Black’s initial draft) that are necessary to offset the cost of the additional military spending that Black proposes. Republican moderates with concerns about the budget resolution say passage of such a resolution will make it more difficult to pass tax reform. Even if the House Budget Committee manages to push through a budget resolution at some point in July, it’s unclear whether it will be able to attract enough support from Republican moderates to make it through the House.

The Tuesday Group (moderate Republicans), because of their concern about the impact of entitlement cuts, particularly to Medicaid, on the public, and their belief that these mandatory spending cuts could “imperil tax reform,” has asked House Speaker Paul Ryan to delay consideration of a budget until health care legislation is passed or abandoned so that the members have a clearer idea of what the fiscal picture looks like. They have threatened to oppose the curbs in entitlement spending unless there is a bipartisan deal to increase spending caps. At the other end of the spectrum within the House Republican Conference, Freedom Caucus members say that they will back an FY18 budget resolution only if it cuts mandatory programs, including Medicaid and food stamps. (The Freedom Caucus and the Tuesday Group each represent enough House Republicans that either group’s opposition to an FY18 budget resolution would be sufficient to bring about its defeat.)

Moderates say that the budget resolution’s proposed $621.5 billion in defense spending (not including war funds) also would violate the law by exceeding the $548 billion cap on defense spending for FY18 under the Deficit Reduction Act.

FY18 appropriations bills

The continuing struggle over ACA repeal-and-replace legislation has delayed consideration of an FY18 budget resolution. The failure to adopt an FY18 budget resolution has left the Appropriations Committees in the dark as to the overall level of resources that will be available for spending in FY18. As a result, the FY18 appropriations bills are being marked up without any section 301 overall spending limit or any section 302(b)s divvying up the overall spending limits among the various appropriations bills.

The foregoing factors have led to a backlog in the appropriations process. With only 25 legislative days remaining in the House before FY17 ends on September 30, the House Appropriations Committee has now marked up about half of the bills and has reported to the House only its version of the FY18 Military Construction and Veterans Affairs Appropriations bill. With 27 legislative days remaining in the Senate until the FY17 fiscal year expires on September 30, the Senate Appropriations Committee has yet to mark up and report to the Senate any of the FY18 appropriations bills.

This backlog has led some House Republicans to propose that some or all of the appropriations bills be packaged in a single bill to be taken up by the House before the August recess as a way to accelerate consideration of the FY18 bills. Whether the House Republican leadership elects to move forward with such an omnibus appropriations bill, the delays in the appropriations process and the inactivity to date in the Senate on appropriations bills make it highly likely that a continuing resolution will be required to fund the federal government’s operations after September 30 and avoid a government shutdown.

Debt ceiling increase

Treasury Secretary Stephen Mnuchin wants the debt ceiling raised before the summer recess and a vote on raising the debt limit may be held immediately before the long August recess if health care has been dealt with by the end of the month, though it could slip to September if Treasury offers reassurances to Hill leaders that such a timeline would work. (The Congressional Budget Office says that, currently, extraordinary measures can get Treasury to October before the debt ceiling is reached.)

Health care has to get done first says House Majority Leader Kevin McCarthy (R-CA). The unanswered question is whether a coalition of Democratic and Republican members can be mobilized to pass a “clean” debt ceiling increase or whether Congressional Republicans will attempt the far more difficult task of tying an increase in the debt ceiling to the adoption of further spending cuts.

Tax reform

Comprehensive tax reform legislation is not expected to be introduced and considered by Congress before the summer recess. The Big Six—Treasury Secretary Mnuchin, National Economic Council Director Gary Cohn, Speaker Ryan, Senate Majority Leader Mitch McConnell, House Ways and Means Committee Chairman Kevin Brady and Senate Finance Committee Chairman Orrin Hatch—have been meeting to discuss tax reform, with the goal of reaching agreement on a framework to be considered by the House and the Senate this fall.

Meanwhile, Ways and Means will hold tax reform hearings in July, with a hearing on how tax reform will help small businesses grow and create jobs already scheduled for July 13. The Senate Finance Committee, for its part, will begin considering comments it has received as a result of Chairman Hatch’s June 16 request for submissions and recommendations for tax reform (Chairman Hatch’s letter gave a deadline of July 17).

Perhaps the most significant event for tax reform in July will be how the Senate deals with health care reform, as passing or failing to pass health care legislation will directly impact both its likelihood of success and potential scope. The reconciliation process can’t be used for tax reform unless and until there is an FY18 budget resolution and an FY18 budget resolution can’t be addressed until ACA repeal-and-replace legislation is disposed of, one way or the other.

Conflict in Iraq and Syria: Debate on the 2001 Authorization of Military Force (AUMF)

On Thursday, June 29, the House Appropriations Committee approved an amendment to the FY18 Defense Appropriations Act from Congresswoman Barbara Lee (D-CA). The amendment would repeal the 2001 Authorization for the Use Of Military Force (AUMF) 240 days after enactment of the Department of Defense Appropriations bill. As of 2013, the AUMF had been invoked more than 30 times to authorize troop deployments and other military measures, including detentions at Guantanamo Bay and military trials for terrorism suspects.

According to the Congressional Research Service, the AUMF has been used more than 37 times in 14 countries to justify military action. Under Presidents George W. Bush and Barack Obama, the AUMF was used to justify the deployment of US forces to Afghanistan, the Philippines, Georgia, Yemen, Djibouti, Kenya, Ethiopia, Eritrea, Iraq and Somalia. President Obama also used it to justify military action against ISIS, a group that did not even exist when the AUMF was adopted in 2001.

While Rep. Lee’s AUMF language is expected to be stripped from the FY18 Defense Appropriations bill at some point before it becomes law, the inclusion of this language in the text of the Defense Appropriations Act, as adopted by the House Appropriations Committee, makes it likely that the House, and possibly the Senate as well, will have a debate on the relevance and propriety of the AUMF language at some point before the Defense Appropriations Act becomes law. GOP military veterans have voiced strong support for a debate on the AUMF.

Flood insurance

Authorization for the National Flood Insurance Program expires at the end of September. A dispute in the Senate Banking Committee over a privatization proposal offered by Senator Jon Tester (D-MT) is keeping the version of an NFIP reauthorization from moving forward to date in the Banking Committee.

The House version of an NFIP reauthorization is further along. On June 15 and June 21, the House Financial Services Committee approved a package of seven flood insurance bills. While the House has yet to take up these bills, the chamber is expected to vote at some point in July on a five-year reauthorization of the NFIP. That said, several members of the Louisiana delegation say that because of reductions in funding levels and several controversial privatization proposals, this package of bills currently lacks the votes to pass the House. (The National Association of Homebuilders, the National Association of Realtors and many members of Congress are said to oppose the House bill.).

Infrastructure

While many observers hoped and believed that a proposal to upgrade America’s roads, bridges and airports would be an early priority for the Trump administration—as well as one with the potential to attract bipartisan support—it now seems clear that infrastructure sits behind health care, tax reform, a debt ceiling, government funding and even an FAA reauthorization on the administration’s legislative wish list.

On June 29, with the White House still yet to unveil formal legislative text for its massive infrastructure proposal and not expected to do so until the fall, Senate Commerce Committee Chairman John Thune (R-SD) observed that congressional work on the president’s $1 trillion infrastructure package would likely slip to next year.

FAA reauthorization

The House and Senate committees of jurisdiction have marked up two separate versions of FAA reauthorization bills, the major difference being air traffic control reform. The Senate bill lacks the ATC reform language and is very similar to the comprehensive bill passed (with a bipartisan majority) in the Senate in the 114th Congress. Congressman Bill Shuster (R-PA), chair of the House Committee on Transportation and Infrastructure, wants to bring his bill to the floor in mid-July. However with the expectation of a highly contentious dispute over the ATC privatization proposal, the bill’s prospects in the House are uncertain. Meanwhile, consideration of the Senate FAA reauthorization bill may be delayed by the pendency of health care legislation in the Senate.

New drone applications taking flight

Major retailers have been quietly road testing for years the use of drones for product deliveries and warehouse management, but until very recently the universe interested in the commercial application of unmanned aerial systems has been a narrow one.

That’s changing in the wake of a new federal framework taking shape now.

While the U.S. government has deliberately slow-walked the most audacious drone practices until regulators can address critical public safety concerns, progress in the direction of a Jetsons-like sky of robotic vehicles has been made.

In June, the Federal Aviation Administration, which exerts regulatory authority over US airways,  published rules for the use of small drones–a critical first step in accelerating commercial drone applications.

Those rules, which took affect only last month, limit flights to daylight or civil twilight and require that the drones, weighing no more than 55 pounds, must remain within the operator’s line-of-sight at a maximum altitude of 400 feet. (A Chinese company, EHang, has already developed passenger drones that are completely autonomous, though FAA rules would require certification as a manned vehicle even if the passenger is not controlling the craft.)

While the FAA’s rules stop short of permitting broad scale product delivery, they exceed the regulatory regime imposed by much of the rest of the developed world.

(No developed nation has approved routine delivery of products, but federal regulators recently approved earlier this month the delivery of burritos to the campus of Virginia Tech by Google’s parent company, Alphabet Inc., and Mexican quick service chain Chipotle.)

But even as the FAA’s flight restrictions have impeded the most grandiose of drone applications–like automated deliveries and pickups–some intrepid clinicians have begun testing new drone applications for medical treatment within the existing framework.

Pathologists at Seattle, Washington’s Harborview Medical Center recently tested the impact of UAS flights on blood samples, performing a clinical study in which they found that biologics were unharmed in the course of flight, according to NPR.

In sparsely populated or remote areas (like those in Ghana, where health care workers are using drones to deliver contraceptives), accessing and transporting biologic samples can be a costly undertaking.

But unmanned drones could not only reduce transport time but also the transportation cost. Absent more permissive federal regulations, though, those samples will have to stay grounded. For now, that is: FAA estimates that some 60,000 commercially-operated drones will take flight within the next year.

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