Congressional Leaders, White House Reach Deal on Short-Term Government Funding Bill

The House approved a stand-alone Hurricane Harvey relief bill by a 419-to-3 vote on September 6. The measure is expected to be packaged with a short-term continuing resolution (CR) once it reaches the Senate in order to avoid a government shutdown. The CR, which is expected to be added to the Harvey relief aid package along with provisions increasing the debt-limit, would keep federal government funding, including the IRS, at currently enacted levels for three months. If approved, the short-term funding bill would go into effect October 1 through December 15.

The Congressional Budget Office (CBO) released an estimate recently noting that the federal government is likely to run out of money by mid-October if the debt limit is not increased (TAXDAY, 2017/06/30, C.1). In a meeting between President Trump and bipartisan congressional leaders at the White House on September 6, Trump and Democratic leaders agreed to extend the debt-limit and continue government funding for three months, through December 15. Senate Majority Leader Mitch McConnell, R-Ky., said after the meeting that he will add the CR and debt-limit provisions to the Harvey bill once it reaches the Senate.

Reportedly, Republican leadership had originally proposed an 18-month CR, then backed a six-month CR during negotiations. Republican leaders were dismayed by Trump’s agreement with Democrats, according to several reports, which will provide Democrats leverage in future negotiations at the end of the year. House Speaker Paul Ryan, R-Wis., earlier in the day had called Democrats’ three-month extension proposal attached to Harvey relief aid as “playing politics,” and a “ridiculous idea.”

“In the meeting, the president and congressional leadership agreed to pass aid for Harvey, an extension of the debt limit, and a continuing resolution, both to December 15, all together. Both sides have every intention of avoiding default in December and look forward to working together on the many issues before us,” Senate Minority Leader Charles E. Schumer, D-N.Y., and House Minority Leader Nancy Pelosi, D-Calif., said in a joint statement. “We’ve agreed to help those recovering from Hurricane Harvey, avoid default, and avoid a shutdown,” Schumer added later in a tweet. At press time, Republican leadership had not issued any statements regarding the deal.

Meanwhile, the House also considered the Make America Secure and Prosperous Appropriations Bill, 2018 (HR 3354) on September 6. The fiscal year 2018 appropriations bill would provide $11.1 billion in funding for the IRS, cutting current levels by $149 million, but marking an $111-million increase above President Trump’s budget request. At press time, a final vote had not yet been taken.

The bill would also limit IRS enforcement of Code Sec. 5000A and specifies that none of the funds made available are permitted to be used by the IRS to “implement or enforce” the Patient Protection and Affordable Care Act’s (P.L. 111-148) individual mandate requiring minimum essential coverage. Under Code Sec. 5000A, individuals are required to pay a penalty if qualifying health care coverage is not obtained.

By Jessica Jeane, Wolters Kluwer News Staff

Division D—Financial Services and General Government Appropriations Act, 2018 of the Rules Committee Print of the Interior and Environment, Agriculture and Rural Development, Commerce, Justice, Science, Financial Services and General Government, Homeland Security, Labor, Health and Human Services, Education, State and Foreign Operations, and Transportation, Housing and Urban Development Appropriations Act, 2018

Login to read more tax news on CCH® AnswerConnect or CCH® Intelliconnect®.

Not a subscriber? Sign up for a free trial or contact us for a representative.

AUTHOR

CCHTaxGroup

All stories by: CCHTaxGroup