Capitol Hill’s Must-Pass Agenda

As Congress returns to Washington after a two-week recess, and we finally have Fiscal Year 2024 in the rearview mirror, Lot Sixteen took a look at the remaining must-pass items as well as other priorities in the legislative agenda before the end of the year. 

There are seven must-pass items that Congress is staring down before the end of the year along with a laundry list of at least ten other high-priority issues proponents will be looking to attach to must-pass legislation.

MUST-PASS BILLS

• Foreign Intelligence Surveillance Act (FISA) Section 702 Reauthorization

• Expiration Date: April 19

• Federal Aviation Administration (FAA) Reauthorization

• Expiration Date: May 10

• Farm Bill

• Expiration Date: September 30

• FY25 Government Funding

• Expiration Date: September 30

• Coast Guard Reauthorization

• Timeline: September 30

• National Defense Authorization Act 

• Timeline: House & Senate Armed Services Committees have the goal of floor action before the August recess.

• Water Resources Development Act (WRDA) 2024

• Timeline: Hearings are underway in the committees of jurisdiction.

LOOKING TO HITCH A RIDE

• Ukraine Funding

• Israel Funding

• Francis Scott Key Bridge Supplemental

• Tax Relief for American Families and Workers Act (H.R.7024)

• PFAS

• Pipeline and Hazardous Materials Safety Administration (PHMSA) Reauthorization

• Permitting Reform

• China, Trade and Investment

• Artificial Intelligence

• Rosemont Fix

QUICK SKETCH ON THE OUTLOOK FOR EACH

Foreign Intelligence Surveillance Act (FISA) Section 702 Reauthorization
Expires April 19

• Disagreements in the House Mean Final Passage Will Be Challenging. The House tried to pass a FISA reauthorization (H.R. 7320), which included reforms to the surveillance program under Section 702, this week, but failed when House Freedom Caucus members voted against the rule that would have allowed for consideration of the underlying bill.  Speaker Johnson has now indicated that he will bring up a clean FISA extension next week, punting a long-term reauthorization to later this year, likely to be included as part of the National Defense Authorization Act (NDAA). 

Federal Aviation Administration (FAA) Reauthorization
Expires May 10

• If the House and Senate Can Find Agreement on a Few Sticky Items, It Should Move Quickly – but We Said IF. The House and the Senate are informally conferencing their bills, which we expect to continue through next month. At this time, we are hopeful an agreement will be finalized ahead of the latest short-term extension, but several items – such as the Reagan National Airport slot and perimeter rules – may still be at issue, preventing an agreement before the deadline. If an agreement can be reached, we then expect the final package to move very quickly and not serve as a vehicle for other priorities.

Farm Bill
Expires September 30

• No Movement Means There WIll Probably Be Another Extension. At this time, it looks like there will have to be another extension, as there have been no signs of significant movement in either chamber towards a comprehensive agreement. Nutrition programs and use of Inflation Reduction Act (IRA) funding seem to be the biggest barriers to reaching an agreement and the fight over the IRA’s climate-ag money is only set to heat up in the coming months. House Republicans – in their hopes to unveil a farm bill draft this spring – are still pressing to repurpose some of the IRA funds in order to pay for some key farm programs and other bipartisan priorities in the legislation.

FY25 Government Funding
Expires September 30

• Spoiler Alert - This Movie Ends with (another) CR and a Lame-Duck Push. The fundamentals haven’t changed and so the odds are on a CR to carry us through the Election as the calendar, and razor thin margins in the House, continue to vex Congress. The FY2025 Appropriations timeline (below) looks doable on paper, but when you consider the actual number of working days and difficult politics of an Election year, we’re guessing we see another CR. We believe there will have to be a Continuing Resolution to carry Congres past the election, setting up a lame-duck push to wrap up appropriations and other unfinished business.

• March / April: Member deadlines

• Late April / Early May: House Subcommittee markups

• Late May / Early June: House Full Committee markups

• June / July: Senate Committee markups

• June / July / September: Possible floor consideration

Coast Guard Reauthorization
Expires September 30

• Crewing Has This Issue Grounded. On March 13, House Transportation & Infrastructure (T&I) Committee Chair Sam Graves (R-MO) introduced H.R. 7659, the Coast Guard Authorization Act of 2024. The bill was marked up and reported out of Committee by an overwhelming 53-3 vote on March 20. But…the bill includes a controversial provision that would mandate that certain specialized vessels, including those used in the construction of offshore wind farms, have crews made up entirely of Americans or citizens of the nation where the vessel is flagged. That’s got things jammed up, making the passage a bit of a question mark.

NDAA

• Prediction: NDAA could look like a Christmas Tree Covered in Ornaments. Hearings are underway in the House and Senate Armed Services Committees with the House Armed Services Committee likely to hold markups in mid/late Spring, with hopes of floor action before the August recess. Same in the Senate except the Armed Services Committee plans to hold markups in mid/late June, with the same goal of floor action before the August recess. 

  Will they make it? We doubt it. We expect the House and Senate to finalize a bipartisan and bicameral Conference Report before year’s end, which this year, means passage during the lame duck. We would also expect the Intelligence Authorization Act to be enacted as part of NDAA, although it remains to be seen what else will be able to hitch a ride on this must-pass vehicle. Last year, managers were very strict on allowing non-germane items to attach to the Conference Report, but the amount of must-pass items piling up for this year’s lame duck may necessitate NDAA serving getting adorned with enough ornaments to resemble a Christmas tree as a vehicle for those priorities.

Water Resources Development Act (WRDA) 2024
Timeline: Hearings are underway 

• Everyone Knows Ducks Need Water. But Did You Know That WRDA Needs The Lame Duck? The House T&I Committee will likely hold a mark-up on WRDA in April, to set up floor consideration of WRDA before the August recesswhile the Senate Environment & Public Works (EPW) Committee is targeting a May mark-up, with the goal to have the bill reported out of Committee by mid-to-late May. Despite the progress, we are hearing that this year’s WRDA will primarily focus on the U.S. Army Corps of Engineers project implementation provisions, and will not include any policy provisions. That means we should expect the House and Senate to pre-conference the bill late summer/early fall so that final passage can occur during the lame duck. In 2022, WRDA hitched a ride on the FY23 NDAA. We would not be surprised if WRDA 2024 sees a similar outcome in the post-election lame duck session.

ITEMS LOOKING FOR A RIDE

Ukraine Funding

• The Speaker Is Committed But It’s Hard to See it Right Now. While Speaker Mike Johnson (R-LA) has recently signaled that he wants new Ukraine funds approved “right away,” it remains unclear how he plans to soften opposition from hard-liners within his Conference. The House Freedom Caucus has threatened a Motion to Vacate over Ukraine funding and Rep. Marjorie Taylor Greene (R-GA) has already filed a Motion to Vacate, though she has not specified when she would call it up. Nevertheless, Speaker Johnson seems committed to taking up Ukraine aid in the next two weeks after the House returns to Washington. However, the provisions Johnson has previewed – attaching new conditions to the aid; seizing Russian assets as an offset; and reversing a Biden administration pause on new licenses to export LNG – are much different than the supplemental passed by the Senate in February, potentially creating a lengthy delay in actually getting Ukraine the money.

Israel

• There’s Still A Lot of Support But The Politics of Israel Have Been Badly Shaken by the War in Gaza. As the war moves into its sixth month, it remains unclear how the House and Senate will proceed on emergency aid, particularly as frustrations mount over Israel’s tactics. While the Ukraine/Israel/Taiwan bill passed the Senate with 70 votes, a lot has happened since then, which has increased calls by some in Washington for more conditions on any new aid to Israel.

Francis Scott Key Bridge Supplemental

• Could Baltimore Bridge Funding be the Key to a Larger Stalled Supplemental? To coincide with President Biden’s Friday visit to Baltimore in the wake of the Francis Scott Key Bridge disaster, OMB Director Shalanda Young sent Congress a letter to key lawmakers urging Congress to authorize a “100 percent Federal cost share for rebuilding the bridge.” Notably, the letter does not spell out how much money Congress needs to approve in response to the bridge collapse, although we expect it could run into the billions of dollars. While the Biden administration sent a domestic-focused supplemental spending request to Capitol Hill in October, Congress never acted on it. The national economic emergency created by the Key Bridge collapse may provide the vehicle for Congress to act on all these domestic priorities. Some readers may remember that Congress provided $250 million in funding to rebuild the Interstate 35W bridge that collapsed across the Mississippi River in 2007, and it was repaired within a year. Members of the Maryland delegation are hoping for the same swift response from this Congress.

Tax Relief for American Families and Workers Act (H.R.7024)

• Hopes Are Dimming. Conversations continue in the Senate about how it may consider the House-passed tax package, which reflects the agreement reached between House Ways & Means Committee Chair Jason Smith (R-MO) and Senate Finance Committee Chair Ron Wyden (D-OR). However, many Senate Republicans, led by Finance Committee Ranking Member Mike Crapo (R-ID), are not on board with the agreement on the child tax credit, among other provisions. There are no indications that the measure’s supporters will be able to find the support necessary to get it moving. Today marks one week before the end of tax-filing season and it’s unclear how long this bipartisan package can just sit around. We know that Chair Wyden hasn’t given up hope just yet; in the latest round of conversations with ranking member Crapo, he counter-offered with some sweeteners for Republicans, including traditional tax extenders and technical corrections to the Secure 2.0 retirement bill. 

Permitting Reform

• More Than the House Can Stomach – Or a Grand Bargain in the Wings? Senate Energy Chair Joe Manchin (D-WV) continues to insist that he and Ranking Member John Barrasso (R-WY) are “close” on agreeing to permitting reform legislation that Manchin wants to move before the August recess. However, House Republicans continue to downplay the odds for permitting reform in the current Congress, and have suggested that limited sector-specific permitting relief is as much as the current political climate can bear. 

Per- and Polyfluoroalkyl Substances (PFAS)

• Disagreements Exist but This is One to Watch. While we wait for the Environmental Protection Agency (EPA) to finalize its forthcoming rule on PFAS Comprehensive Environmental Response, Compensation and Liability Act (CERCLA) designation, industry concerns about the rule’s potential to expose passive receivers of PFAS to liability caught the attention of the Senate EPW Committee, which recently held a hearing on the matter. We believe Chair Tom Carper (D-DE) and Ranking Member Shelley Moore Capito (R-WV) are committed to moving legislation which would provide some sort of liability exception to passive receivers, the details of which are still being worked out. If an agreement can be reached, we believe this legislation could move on NDAA or the forthcoming emergency supplemental to address the Francis Scott Key Bridge’s collapse.

Pipeline and Hazardous Materials Safety Administration (PHMSA) Reauthorization

• To Authorizing Committees Make PHMSA Fraught. PHMSA’s reauthorization is split between two House Committees – T&I and Energy & Commerce (E&C). E&C reported its portion (H.R. 7655) out of Committee in March, just prior to this last recess. E&C’s bill was heavily criticized by Democrats for being too partisan. The T&I portion of the bill (H.R. 6494) passed out of Committee on a bipartisan vote in December, and is non-controversial. Movement on the reauthorization bill will be complicated given the partisan nature of the E&C portion of the bill. It’s worth noting that PHMSA has been without a full time Administrator for three years, and its authorization expired in September 2023.

China, Trade, and Investment

• Everyone Agrees China is a Threat. No One Agrees What To Do About It. Congress continues to debate legislation that would restrict U.S. investment in critical technologies from countries of concern like China, but remains starkly divided over the best approach. Some are pushing to codify and build upon the President’s Executive Order on outbound investments while others are pursuing a mix of sanctions and monitoring requirements. There is a great deal of work to be done between the Chambers on this, but if differences are bridged a compromise could possibly hitch a ride on the NDAA.

  Other China-related trade measures at center of conversations on the Hill: reforms to the treatment of customs de minimis shipments and changes to China’s Permanent Normal Trade Relations status, both of which were referenced in a slate of policy recommendations from the House Select Committee on the Chinese Communist Party (CCP) but face a narrow window to achieve consensus and move in 2024. 

  Rep. John Moolenaar (R-MI), the incoming Chairman of the House Select Committee on the CCP, is expected to maintain the Committee’s focus on the above issues upon the departure of outgoing Chairman Mike Gallagher (R-WI) on April 19. Moolenaar’s tenure may also bring heightened attention to the NO GOTION Act (H.R. 6175), which would prohibit companies affiliated with the CCP from receiving IRA tax benefits. As with the other potential China measures noted, there are narrow windows of opportunity remaining to get such bills passed but the NDAA may present an opportunity. 

  Bipartisan skepticism toward China has deepened significantly on Capitol Hill over the past year and staff have begun to reject meetings with firms connected to Chinese companies. Meanwhile, legislation like Sen. Josh Hawley’s (R-MO) Time to Choose Act (S. 3810) would prohibit conflicts of interest among consulting firms that simultaneously contract with the U.S. and Chinese governments. We expect to see legislation and actions along these lines continue through the remainder of this Congress.

Artificial Intelligence (AI)

• Senate and House Reports Are Being Produced, And NDAA Might Provide a Vehicle. Senate Majority Leader Chuck Schumer’s (D-NY) bipartisan AI Working Group – comprising Sens. Todd Young (R-IN), Mike Rounds (R-SD), and Martin Heinrich (D-NM) – is preparing to release a report containing policy recommendations, intended to help inform the efforts of the committees of jurisdiction. The House’s bipartisan Task Force on AI – established by Speaker Johnson and Minority Leader Hakeem Jeffries (D-NY) and co-led by Reps. Jay Obernolte (R-CA) and Ted Lieu (D-CA) – has been deputized to produce a comprehensive report detailing guiding principles and policy proposals. As both efforts seek to ensure America’s continued leadership in AI innovation and consider appropriate guardrails, NDAA appears to be the most likely vehicle for any consensus legislation. An additional complicating factor is opposition to certain directives in the President’s sweeping AI Executive Order, such as the novel invocation of the Defense Production Act to compel disclosures from industry. 

Rosemont Fix

• Ninth Circuit Rosemont decision upended precedent - but it is unclear if Congress can pass a fix. The mining industry and its supporters are still looking for a legislative fix to the Ninth Circuit’s so-called “Rosemont decision” which overturned decades of precedent for “ancillary” uses of mining lands—freezing investments in a sector that underpins much of President Biden’s climate, energy, and defense goals. Mining advocates had hoped to secure a fix in the FY24 appropriations bills but were unsuccessful and are now looking to other vehicles, such as the foreign aid supplemental.

As always, the Congressional landscape is constantly changing, but we’ll be sure to keep tracking the noise. Check back here for more updates.