YOUR CONGRESS AT WORK

(Photo courtesy of WikiMedia.)

DURING THE WEEK ENDING 

JULY 18, 2014

HOUSE RESOLUTION 5021:

H.R. 5021 is the Highway and Transportation Funding Act of 2014, which will fund highways, highway safety programs, public transportation programs and hazardous materials. This bill references underground storage tanks, employee retirement benefits and the Dingell-Johnson Sports Fishing Restoration Act, oddly.

This bill passed in the House with a bipartisan vote of 367 for, and 55 against, and will provide for a temporary patch of the highway fund by adding $10.8 billion to the Highway Trust Fund in order to finance ongoing road, bridge and mass-transit projects. Unless Congress acts quickly to replenish the fund, it will fail to fund completion of many existing projects across the nation, and hundreds of thousands of jobs will be lost.

This bill would raise $6.4 billion over 10 years using a scheme that involves allowing companies with defined-benefit pension plans to defer some portion of pension contributions, which would raise profits and federal tax payments in the immediate future. My take on this provision is that it sucks for employees, who I'm sure will continue to contribute to their pensions even as employers get to defer their contributions. But it appears an acceptable plan for companies, who would pay more in taxes due to increased profits, while delaying their obligation to employees over the next 10 years. (Of course, who knows what will happen over 10 years, or if employees will really have their pensions fully funded at any time in the next decade.)

The remainder of the budget will be raised by taking as much as $4.4 billion resulting from changes in customs fees, and from an existing fund that has been appropriated for the repair of leaking underground storage tanks.

HOUSE RESOLUTION 5016:

H.R. 5016 is the Financial Services and General Government Appropriations Act, 2015. It will fund Department of Treasury operations through September 30, 2015.  H.R. 5016 passed in a 228 to 195 vote with all but six of the aye votes coming from Republicans.

H.R. 5016 includes some 15 amendments. In a 338 to 80 vote, House Amendment 1058 passed with the support of 222 Republicans and 116 Democrats.  H. Amend. 1058 proposes to increase funding for taxpayer services at the IRS by $10 million by reducing IRS enforcement by a similar amount. One can only imagine that this is great for corporations who do not want the IRS enforcing tax laws against them. It may also benefit citizens who skirt tax laws and hope to avoid an audit, though that seems less likely.  Audits of individual tax returns are far less complicated and costly to conduct than audits of corporate tax returns, thus there will probably be no benefit for the individual.

H. Amend. 1067 to H.R. 5016 proposes to increase the fiscal budget for the Securities and Exchange Commission by $300 million to the $1.7 billion level requested by President Obama. The SEC is charged with regulating the securities industry and providing oversight to protect investors. This amendment was NOT passed, in a vote of 184 for and 235 against. 225 Republicans voted against increasing the budget of the SEC, whereas 183 Democrats thought it wise to allow the SEC to do it's job of regulating the securities industry.

H. Amend. 1098 to H.R. 5016 proposes to prohibit the use of funds to any authority of the government in the District of Columbia for the purpose of enforcing any provision of the Firearms Registration Act of 2008. This is an interesting amendment in that it will have the effect of creating a zone where gun laws are not enforced right in our nation's capitol. Presumably, lawmakers aren't worried about becoming victims, since they spend so little time in D.C., but maybe some House representatives are secretly hoping that President Obama could become a victim ...

HOUSE RESOLUTION 4719:

The America Gives More Act of 2014, H.R. 4719, also known as the Fighting Hunger Incentive Act of 2014, passed in a 277 to 130 House vote. H.R. 4719 includes a provision to give permanent status to tax deductions that all non-C corporations receive for donating food inventory to charitable organizations. (C corporations already get the deduction.) The bill also expands inclusion for the tax break to ranchers and farmers. This bill will increase from 10% to 15% the maximum percentage of net income that all businesses can deduct for food donations.

According to official budget projections, H.R. 4719 will add $1.9 billion to the national debt over 11 years.

To determine the fair market value of donations, H.R. 4719 states:

"In the case of any such contribution of apparently wholesome food which cannot or will not be sold solely by reason of internal standards of the taxpayer, lack of market, or similar circumstances, or by reason of being produced by the taxpayer exclusively for the purposes of transferring the food to an organization described in subparagraph (A), the fair market value of such contribution shall be determined—

(I) 

without regard to such internal standards, such lack of market, such circumstances, or such exclusive purpose, and

(II) 

by taking into account the price at which the same or substantially the same food items (as to both type and quality) are sold by the taxpayer at the time of the contribution (or, if not so sold at such time, in the recent past)."

So, it looks like businesses will be able to donate food they can't sell, even for the reason that it is substandard, and all the food must be is "apparently wholesome." It also doesn't matter if businesses produce the food "exclusively for the purposes of transferring the food to an organization" that would fit the definition of charitable. This language suggests that businesses can produce food they consider not fit to sell to consumers with the intention to donate it to charitable organizations, and receive the tax break of up to 15% of net income. Does anyone else find this to be, well, a substandard plan?

H.R. 4719 was passed by Republicans, who comprised 221 of the 277 aye votes. It's unsurprising that Republicans are more concerned that businesses have significantly improved benefits (15% of net income can be deducted through the donation of food they can't or wouldn't sell at market!) while placing the burden of $1.9 billion squarely on the shoulders of citizens over the next 11 years.

This highlights the lie we are so often told: that Republicans are fighting for our children and grandchildren's future financial health by attacking government expenditures now. The bills passed on to the Senate for a vote seem consistent in one area -- they all cost individual taxpayers oodles of money for years to come, while benefiting business exclusively. Sure, charitable organizations will be able to feed more hungry people food that is not fit for consumers who buy their food at the store, but doesn't this seem to be forward planning for the eventuality of there being a lot more hungry people? The House keeps passing bills that have very little chance of being enacted into law. So while it may appear that the House is doing something by passing resolutions, they are resolutions that do not pass into law.

Another disappointing week in the House.