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Capital Thinking

Transatlantic Trade and Investment Partnership: Status and Financial Services Issues

Posted in Financial Services, International

On June 17, 2013, President Obama, European Council President Van Rompuy and European Commission President Barroso agreed to open negotiations on a Transatlantic Trade and Investment Partnership (TTIP) agreement. Since then, EU and US officials have conducted seven negotiation rounds on TTIP, with an eighth round expected to take place in Brussels in early February 2015.

While the original goal was to complete the TTIP negotiations in 2014, EU and US officials have recently called for a “fresh start” on the negotiations, as “an opportunity for both sides at the table to look anew at the outstanding issues and figure out how best to take them forward.” Further, EU Trade Commissioner Malmstrom has held open the possibility of a deal on TTIP being finalized before the 2016 US Presidential elections. Indeed, during a December 11 meeting in Washington DC, she noted “it’s a little bit too early to say, but we will do, from our side, our utmost to make that [timeline]. … But it’s not impossible. We’ll see, we’ll try.”

The TTIP is of significant geopolitical importance – it will generate jobs and economic growth in the US and the EU markets, in addition to regulatory compatibility and harmonization. However, the negotiations have also brought to light several challenges in the EU-US trade relationship. For example, the EU has expressed concerns regarding US restrictions on energy exports and agricultural market access and the US has highlighted investor-state dispute settlement (ISDS) as a key priority for TTIP.

Financial Services

One of the contentious issues in the TTIP negotiations is the inclusion of a financial services chapter. While EU officials have pressed for inclusion of financial services regulations to be part of TTIP, the Obama Administration is against including financial services in TTIP given fears that the negotiations may pare back US financial regulatory reforms established in the aftermath of the Dodd-Frank Act. Instead, US officials have repeatedly expressed a desire to discuss financial services regulatory issues in parallel tracks to TTIP. While recognizing the importance of financial services in the transatlantic economy, the Office of the US Trade Representative, for example, has emphasized, “a successful TTIP will increase financial services market access to the EU as well as provide consumers with access to high-quality financial services and greater choice with regard to suppliers. At the same time, we will continue to ensure that our government retains full discretion to regulate the financial sector and to take the actions necessary to ensure the stability and integrity of the US financial system.”

Issues that could be part of future financial services discussions surrounding TTIP include regulatory harmonization in areas such as the cross-border application of rules for swaps transactions, risk management requirements, enhanced prudential standards for certain systemically important institutions, and clearing and reporting requirements. In the next Congress, we expect Republicans to continue supporting a TTIP that includes such financial services discussions. As the incoming Chair of the Senate Finance Committee, Orrin Hatch (R-UT), stated in an October 2013 hearing, “financial services play an essential role in facilitating trade and investment flows between our two regions. Given the central importance of the financial sector to every other aspect of industrialized economies, I do not see how financial services regulation can be excluded from a meaningful TTIP.”

Trade Promotion Authority

As negotiations regarding TTIP continue in 2015, the US Congress will begin work on Trade Promotion Authority (TPA) legislation, which would give the President authority to negotiate international trade agreements such as TTIP, while allowing Congress to approve or disapprove without amending (or filibustering) such agreements.

Earlier this month, President Obama stated that he will work with the US Congress on a bipartisan TPA bill in 2015. Democratic lawmakers such as Senator Sherrod Brown (D-OH) and Representative Rosa DeLauro (D-CT) have expressed opposition to TPA legislation, unless it includes certain improvements on issues such as “human rights, trade enforcement and real enforceable labor and environmental standards.” On the other hand, Republicans in the House Ways and Means Committee have recently indicated they hope to release a revised TPA, with few changes, in early 2015, indicating that Republicans may not be interested in a comprehensive overhaul of the bill.

Before Adjourning, US Congress Adopts Budget with Dodd-Frank Amendments; Fails to Pass Terrorism Risk Insurance Legislation

Posted in Financial Services

Before the 113th Congress adjourned on December 16, Congress adopted the Consolidated and Further Continuing Appropriations Act of 2015, which ensures the federal government operates with budget certainty until September 2015.

Among the provisions included in the last-minute budget agreement was an amendment to a provision in the 2010 Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank Act) that will provide banks with the ability to serve their customers and hedge associated risk by expanding the categories of allowable derivative transactions that can take place within a covered institution. These changes will narrow the types of derivatives transactions required to be “pushed out” from the depository institution and into affiliates not backed by the bank-supported FDIC deposit insurance fund.

Other Dodd-Frank Act provisions were submitted for inclusion in the budget package, but failed to make it to the Senate floor, including changes to the Consumer Financial Protection Bureau’s funding. Before adjourning, Congress also adopted the Insurance Capital Standards Clarification Act of 2014, which provides flexibility to the Federal Reserve in its application of capital requirements to insurance companies designated as systemically important. The legislation clarifies Section 171 of the Dodd-Frank Act, giving room for regulators to tailor their rules to particular business models rather than broadly applying bank-centric standards.

Congress failed, however, to renew the Terrorism Risk Insurance Act (TRIA). After weeks of negotiations between the two chambers, the House passed a six-year extension of TRIA with a provision amending the Dodd-Frank Act’s application to commercial end-users who rely on derivatives to hedge risk by exempting certain energy and agricultural companies from posting collateral. As with the budget package, House Republicans tried to attach provisions to ease mortgage regulations and pare back the application of the “Volcker Rule,” which restricts banks proprietary trading activity and ownership in or sponsorship of certain hedge and private equity funds. However, these provisions were not included in the House-passed bill.

Ultimately, TRIA renewal failed because Senators could not resolve objections from retiring Senator Tom Coburn (R-OK) over an unrelated provision regarding multi-state licensing for insurance agents and brokers. House Speaker John Boehner (R-OH) has indicated TRIA will be one of the first issues the 114th Congress will address when it convenes in January, though the substance of the legislation may change to reflect the transition to a Republican-controlled House and Senate. Consideration of TRIA reauthorization early next year may soften the potential impact that the expiration may have on the insurance and other relevant industries relying on TRIA.

The maneuvers taken during the last days of the 113th Congress certainly preview the policy debates and legislative trajectory for the 114th Congress. Indeed, after passage of the spending bill, Senator Sherrod Brown (D-OH), incoming Ranking Member of the Senate Banking Committee, stated that “what happened this week shows that Wall Street never gives up, that Wall Street isn’t contrite about what it did six, seven, eight, nine years ago and that we will have to stick together and work hard to protect the public.” As Senator Elizabeth Warren (D-MA) challenged Senators during a floor debate, “does [Congress] work for the millionaires, the billionaires, the giant companies with their armies of lobbyists and lawyers? Or does it work for all of us.”

The 114th Congress will feature a Republican-controlled House and Senate, with a change in leadership in the Senate and a new set of policy priorities from a new slate of Chairmen. Of course, President Barack Obama retains veto power over any legislation. As noted in our post-election analysis, the Congressional-Executive relationship will continue to have significant implications for financial services policy formulation in 2015.

113th Congress Set to Adjourn; Capital Thinking to Resume in January

Posted in General Legislative

Capital Thinking Update

Given that the 113th Congress is scheduled to adjourn this week, please note that today, December 8, will be the last Capital Thinking update until January 5, 2015, the week when the 114th Congress is scheduled to begin.

Senate Legislative Activity

On Monday, December 8, following any Leader remarks, there will be a period of morning business until 5:30 pm. At 5:30pm, the Senate will proceed to roll call votes on various nominations.  The roll call votes include:

  1. Confirmation of Executive Calendar #1082, Jeffery Martin Baran, to be a Member of the Nuclear Regulatory Commission for the remainder of the term expiring June 30, 2018;
  2. Confirmation of Executive Calendar #1083, Lauren McGarity McFerran, to be a Member of the National Labor Relations Board for the term of five years expiring December 16, 2019; and
  3. Confirmation of Executive Calendar #552, Ellen Dudley Williams – to be Director of the Advanced Research Projects Agency-Energy, Department of Energy.

House Legislative Activity

On Monday, December 8, the House will meet at 12:00 pm for morning hour and 2:00 pm for legislative business, with no votes expected.

Lawmakers will consider H.R. 5781, the California Emergency Drought Relief Act of 2014, under a closed rule with one hour of debate.

Additionally, the following legislation will be considered under suspension of the rules:

  1. H.R. 5385 – To designate the facility of the United States Postal Service located at 55 Grasso Plaza in St. Louis, Missouri, as the “Sgt. Amanda N. Pinson Post Office”;
  2. H.R. 5794 – To designate the facility of the United States Postal Service located at 16105 Swingley Ridge Road in Chesterfield, Missouri, as the “Sgt. Zachary M. Fisher Post Office”;
  3. H.R. 4030 – To designate the facility of the United States Postal Service located at 18640 NW 2nd Avenue in Miami, Florida, as the “Father Richard Marquess-Barry Post Office Building”;
  4. H.R. 5562 – To designate the facility of the United States Postal Service located at 801 West Ocean Avenue in Lompoc, California, as the “Federal Correctional Officer Scott J. Williams Memorial Post Office Building”;
  5. H.R. 5687 – To designate the facility of the United States Postal Service located at 101 East Market Street in Long Beach, California, as the “Juanita Millender-McDonald Post Office”;
  6. H.R. 579 – To designate the United States courthouse located at 501 East Court Street in Jackson, Mississippi, as the “R. Jess Brown United States Courthouse”;
  7. H.R. 1378 – To designate the United States courthouse located at 333 West Broadway in San Diego, California, as the “James M. Carter and Judith N. Keep United States Courthouse,” as amended;
  8. H.R. 4926 – To designate the “James L. Oberstar Memorial Highway” and the “James L. Oberstar National Scenic Byway” in the State of Minnesota, as amended;
  9. H.R. 5146 – To designate the United States courthouse located at 700 Grant Street in Pittsburgh, Pennsylvania, as the “Joseph F. Weis Jr. United States Courthouse”;
  10. S. 1434 – To designate the Junction City Community-Based Outpatient Clinic located at 715 Southwind Drive, Junction City, Kansas, as the “Lieutenant General Richard J. Seitz Community-Based Outpatient Clinic”;
  11. S. 229 – Corporal Michael J. Crescenz Act of 2013; and
  12. S. 2921 – To designate the community based outpatient clinic of the Department of Veterans Affairs located at 310 Home Boulevard in Galesburg, Illinois, as the “Lane A. Evans VA Community Based Outpatient Clinic.”

On Tuesday, December 9, and Wednesday, December 10, the House will meet at 10:00 am for morning hour and 12:00 pm for legislative business.  Lawmakers will also consider H.R. 1422, the EPA Science Advisory Board Reform Act of 2013, subject to a rule.  On Thursday, December 11, the House will meet at 9:00 am for legislative business, with last votes expected by 3:00 pm.

The following legislation will be considered under suspension of the rules:

  1. H.R 5086 – To amend the National Trails System Act to direct the Secretary of the Interior to conduct a study on the feasibility of designating the Chief Standing Bear National Historic Trail, and for other purposes, as amended;
  2. H.R 5699 – John Muir National Historic Site Expansion Act, as amended;
  3. H.R 5701 – Western Oregon Indian Tribal Lands Act, as amended;
  4. S. 1000 – Chesapeake Bay Accountability and Recovery Act of 2014;
  5. H.R. 5705 – Propane Education and Research Enhancement Act of 2014;
  6. H.R. 5185 – EARLY Act Reauthorization of 2014, as amended;
  7. H.R. 5764 – Great Lakes Restoration Initiative Act of 2014;
  8. S. 2759 – To release the City of St. Clair, Missouri, from all restrictions, conditions, and limitations on the use, encumbrance, conveyance, and closure of the St. Clair Regional Airport;
  9. H.R. 5059 – Clay Hunt SAV Act, as amended;
  10. H.R. 5656 – Global Food Security Act of 2014, as amended;
  11. H.R. 2901 – Senator Paul Simon Water for the World Act, as amended;
  12. S. 1683 – Naval Vessel Transfer Act of 2013; and
  13. S. 1691 – Border Patrol Agent Pay Reform Act of 2014.

The House will also consider legislation related to the Terrorism Risk Insurance Act (TRIA), as well as legislation related to the FY 2015 Appropriations process.

No votes are expected on Friday, December 12.

Cybersecurity Legislation Possible This Week; DHS to Hold Cybersecurity Webinars in 2015

Posted in Cybersecurity

Legislative Activity

Cybersecurity Legislation Possible This Week

Last week, Senate leadership began the process of moving two cybersecurity bills – the Federal Information Security Modernization (FISMA) Act of 2014 (S. 2521) and the National Cybersecurity and Communications Integration Center (NCCIC) Act of 2014 (S. 2519) – to the floor to be considered under unanimous consent. S. 2521 would update FISMA, which is the current law that seeks to protect federal government information and security systems; S. 2519 would codify the role of the NCCIC at the U.S.  Department of Homeland Security (DHS) and expand efforts with existing Information Sharing Analysis Centers (ISACs.) The House has previous passed two similar bills related to FISMA reform (H.R. 1163) and the NCCIC (H.R. 3696).  While both of the House bills passed with strong bipartisan support, it is unclear whether there will be any Senators that object to final passage of these bills and may prevent them from moving forward under unanimous consent.

National Defense Authorization Act Cyber Provisions

Last week, the House passed its version of the National Defense Authorization Act (NDAA) which included a number of provisions related to cybersecurity for the U.S. Department of Defense (DOD). The Senate plans to vote on the bill early this week. The legislation adds cybersecurity to DOD’s list of major force programs, which highlights the imp0rtance of cybersecurity to the Department even though this addition is mainly symbolic. Additionally, after there have been many issues in recent years with breaches of contractor networks at DOD, the newest version of the NDAA bill requires the Department to establish a timeline and procedures for contractors to report network breaches and calls on DOD to designate a single office to receive those reports. The bill also requires a report to Congress on the cyberwarfare and hacking capabilities of China and Russia and gives authority to the President to sanction any foreign nationals that engage in cyber espionage of U.S. assets.

This Week’s Hearings:

  • Wednesday, December 10: The Senate Banking, Housing and Urban Affairs Committee will hold a hearing titled “Cybersecurity: Enhancing Coordination to Protect the Finance Sector.” Officials from DHS, FBI, Secret Service and the Department of Treasury are scheduled to appear as witnesses.

Regulatory Activity

DHS to Hold Cybersecurity Webinars in January

DHS recently announced that it was planning to launch a new cybersecurity webinar series next month as part of its Critical Infrastructure Cyber Community (C3 or C-Cubed) Voluntary Program. The first webinar will be held on Wednesday, January 14 and will focus on building a cyber risk management community through the use of the National Institute of Standards and Technology (NIST) Cybersecurity Framework and C3 Program resources. DHS has not announced the dates for the other webinars in the series.

Senate To Take Up the Defense Authorization Bill

Posted in Defense

National Defense Authorization Act (NDAA)

Last Thursday, the House passed the Senate-House compromise FY 2015 Carl Levin and Howard P. ‘Buck’ McKeon NDAA by a vote of 300-119. Retiring House Armed Services Committee Chairman Buck McKeon (R-California) gave his farewell address on the House floor last week, imploring,

“I hope sometime next year a compromise can come to the floor that will end sequestration.”

This week, the Senate is expected to vote on the $577.1 billion bill (H.R. 3979), which sets Pentagon policy and funding levels through October 2015. Similar to the House, the Senate leadership is likely to take procedural steps to preclude votes on amendments.

Secretary of Defense

Last Friday, President Barack Obama  announced his intention to nominate former Deputy Secretary of Defense Ashton Carter as the next Secretary of Defense. Mr. Carter is expected to be able to win Senate approval in the Republican-controlled 114th Congress.

Hostage Rescue Mission

President Barack Obama, Secretary of State John Kerry and Defense Secretary Chuck Hagel condemned last Friday’s murder of U.S. photojournalist Luke Somers in Yemen by al Qaeda terrorists as U.S. and Yemeni military forces attempted a rescue. President Obama said:

“It is my highest responsibility to do everything possible to protect American citizens. As this and previous hostage rescue operations demonstrate, the United States will spare no effort to use all of its military, intelligence, and diplomatic capabilities to bring Americans home safely, wherever they are located. And terrorists who seek to harm our citizens will feel the long arm of American justice.”

ISIL

On Tuesday, Secretary of State Kerry will testify before the Senate Foreign Relations Committee on the Obama Administration’s policy against the Islamic State and congressional authorization of the use of military force. While President Obama has said that he would “welcome” congressional approval, the Administration has drawn criticism from Republicans for not sending Congress a military authorization to consider.

Congressional Hearings

  • On Tuesday, December 9, the Senate Armed Services Committee will hold a confirmation hearing for the following individuals:  Robert Scher to be Assistant Secretary of Defense for Strategy, Plans, and Capabilities; Elissa Slotkin to be Assistant Secretary of Defense for International Security Affairs; David Berteau to be Assistant Secretary of Defense for Logistics and Materiel Readiness; and Alissa Starzak to be General Counsel of the Department of the Army.
  • On Wednesday, December 10, the House Armed Services Subcommittee on Strategic Forces will hold a hearing titled, “Russian Arms Control Cheating and the Administration’s Responses.”

Senators to Hold Campus Sexual Assault Hearing; White House Holds Higher Education and Early Learning Summits; Department Releases Teacher Preparation Proposed Rule

Posted in Education

Legislative Activity

Campus Sexual Assault Legislation to Remain a Priority Next Congress

This week, the Senate Judiciary Committee will hold a hearing on campus sexual assault to explore the roles and responsibilities of law enforcement in handling these types of cases.  Senator Claire McCaskill (D-MO) and Senator Kirsten Gillibrand (D-NY) are scheduled to testify at the hearing, along with representatives from law enforcement agencies at Oregon State University and Cornell University. This hearing is part of an ongoing effort to address issues of sexual assault and violence on college campuses, which included Senators McCaskill and Gillibrand’s efforts along with 16 other bipartisan co-sponsors to introduce the Campus Accountability and Safety Act (S. 2692) in July. The legislation will not be considered in the remaining time of the 113th Congress but it is expected to be reintroduced next year. Incoming Chairman of the Senate Health, Education, Labor and Pensions (HELP) Committee Lamar Alexander (R-TN) worked closely with Senator McCaskill’s staff to draft the bill and will likely continue to be supportive of passing campus sexual assault legislation in the next Congress.

This Week’s Hearings:

  • Tuesday, December 9: The Senate Judiciary Subcommittee on Crime and Terrorism will host a hearing titled “Campus Sexual Assault: the Roles and Responsibilities of Law Enforcement.”

Regulatory Activity

White House Holds Second College Opportunity Summit

Last Thursday, the White House held its second College Opportunity Summit focused on helping more students prepare for and graduate from college. University presidents, school superintendents, business leaders and other education stakeholders attended the Summit and made over 600 new commitments to expand access and opportunities for more students to enroll and succeed in college, particularly low-income and underrepresented students. The White House released a fact sheet that details the commitments which were focused in one of four areas:  (1) building networks of colleges focused on promoting completion, (2) creating K-16 partnerships around college readiness, (3) investing in high school counselors as part of the First Lady’s Reach Higher initiative, and (4) increasing the number of college graduates in science, technology, engineering, and mathematics (STEM) fields. Additionally, the President announced action would also be taken on the following commitments:

  • Dedicate $10 million to research college completion through the Institute of Education Sciences;
  • Expand college access through the AmeriCorps Partnership Challenge to provide education awards for AmeriCorps members through public-private partnerships;
  • Launch an experimental site to test the impact of making Pell grants available to high school students in dual enrollment programs;
  • Expand the FAFSA completion initiative; and
  • Produce new customized college access guides and resources through the White House Initiatives on Educational Excellence for Hispanics and Education Excellence for African Americans and the Center for Faith Based and Neighborhood Partnerships.

Department to Release College Ratings System

As part of the President’s college affordability agenda announced last year, the Department of Education has been working to create a college ratings system that it plans to unveil before the end of the year. The Department has worked with stakeholders to develop the metrics that would be used to rate colleges and universities based on its three key principles – access, affordability, and outcomes – but many stakeholders have expressed concerns about how the ratings system may be structured. While President Obama originally proposed to tie federal financial aid to the college ratings system, it is unlikely to occur given that it would require Congressional action and Republicans in both chambers have noted their concerns over the proposed system.

Department Releases Teacher Preparation Proposed Rule

The Department of Education recently released its teacher preparation proposed rule to strengthen current teacher preparation programs and hold these programs accountable to ensure that they are preparing K-12 teachers well for the classroom. The proposed rule will require states to report on all programs in their state, including alternative certification programs, as opposed to only reporting on teacher preparation programs at institutions of higher education as is currently required. After collecting comments on the proposed rule, the Department plans to release a final rule in September 2015 and states will have one year from that time to work with stakeholders to design a teacher preparation accountability and data collection system. Academic Year 2016-17 will be the first year that the Department collects data on teacher preparation programs under the new systems, and a report card for each state will be published for the general public in April 2018. Also, the Department plans to tie the data from the report cards to the eligibility for Teacher Education Assistance for College and Higher Education (TEACH) grants starting in July 2020. Comments on the proposed rule are due February 2, 2015.

Education Department Makes Improvements to Student Loan Servicing

On Monday, December 8, the Department of Education Office of Federal Student Aid (FSA) will publish a comment request seeking information related to third party servicer data collection. The Department is seeking approval of a Third Party Servicer Data Collection form to validate the information reported by higher education institutions regarding servicers administering Title IV student aid programs on an institution’s behalf.  It also seeks information related to the effective oversight of such entities.  Comments are due on or around January 7, 2015.

In late November, FSA issued a request for information (RFI) on how to improve borrower satisfaction and outcomes as the office manages a growing portfolio of Title IV student loans.  Specifically, the RFI seeks feedback on: how to efficiently and effectively manage a growing portfolio in a manner that will improve borrower satisfaction and outcomes; provide common borrower experiences; and allow for consolidated reporting of financial information, borrower data, etc., consistent with Federal accounting and audit requirements. FSA is particularly interested in information related to alternative approaches to its multi-servicer, multi-system contract model, including “the use of a single servicing platform, the use of specialized vendors to provide discrete services such as call center operations, and opportunities to leverage broader commercial servicing models within the student loan environment.” Responses to this RFI are due January 30, 2015.

White House to Hold Early Learning Summit

On Wednesday, December 10, the White House will host a Summit on Early Learning, which will bring together a broad coalition of stakeholders committed to expanding access to high-quality early education. The President is expected to announce the winners of this year’s federal Preschool Development Grants and Early Head Start-Child Care Partnership Grants – an investment of $750 million to expand preschool programs and improve access to high-quality care.  Several private sector commitments to expand early learning opportunities also will be announced at the event.

Senate Takes Action on Energy Nominees

Posted in Energy

Legislative Activity

Senate Ready to Vote on NRC Nominee

On Thursday, December 3, the Senate voted to end debate and move forward on a vote to approve President Obama’s nomination of Jeffrey M. Baran to serve as a member of the Nuclear Regulatory Commission (NRC). The vote to end debate on Mr. Baran’s nomination was contentious and ended in a 53-40 vote despite the relatively non-partisan nature of the Commission’s work, and the fact that Mr. Baran already serves as a member of the Commission. Republicans argued that Mr. Baran’s nomination should have been subject to a full confirmation hearing. Others argued that President Obama deliberately bypassed more experienced potential nominees by nominating Mr. Baran to serve. The Senate will likely vote to approve Mr. Baran’s nomination today, December 8.

Senate Energy Committee Appears Supportive of FERC Nominee

On Thursday, December 4, the Senate Energy and Natural Resources Committee held a hearing to consider President Obama’s nomination of Ms. Collette Honorable to serve as a member of the Federal Energy Regulatory Commission (FERC). The hearing went smoothly, and committee members’ questions seemed to indicate that Ms. Honorable will not face partisan opposition when the committee votes to approve her nomination.

This Week’s Hearings:

  • Thursday, December 11: The House Energy and Commerce Committee will hold a hearing titled “The Energy Policy and Conservation Act of 1975: Are We Positioning America for Success in an Era of Energy Abundance?”
  • This week, the House Energy and Commerce Committee is expected to hold a hearing to investigate the Environmental Protection Agency’s decision not to finalize the 2014 Renewable Fuel Standard mandate during the calendar year.

EPA to Boost Brownfields Response and Hold WIFIA Input Session

Posted in Environment and Natural Resources

Regulatory Activity

Brownfields

On Monday, December 8, EPA will accept requests for funding to increase state capacity to address and remediate brownfields. States and tribes are eligible to receive up to $1 million in funding, which is used for assessment, cleanup and redevelopment of brownfields and other contaminated sites.

WIFIA

Also on Monday, December 8, EPA will hold a public meeting to receive input concerning the implementation of the new Water Infrastructure Finance and Innovation Act (WIFIA) of 2014. WIFIA allows for new financing mechanisms for public drinking water and sewage treatment facilities.

Environmental Justice

EPA has extended its deadline to January 9, 2015 for its 2015 Environmental Justice Small Grants (EJSG) applications. Funding through this program is intended to help communities educate and address exposure to local environmental risks.

Legislative Activity

Nuclear Energy

On Wednesday, December 11, the House Science, Space and Technology Committee, Subcommittee on Energy, will hear from, Peter Lyons, Assistant Secretary, Office of Nuclear Energy at the Department of Energy concerning the future of nuclear energy.

Renewable Fuels

On Wednesday, December 11, the House Oversight and Government Reform Committee, Subcommittee on Energy Policy, Health Care and Entitlements, will hold a hearing titled, “Examining EPA’s Management of the Renewable Fuel Standard Program.”

Chemical Facility Security

On Thursday, December 11, the Senate Environment and Public Works Committee, in conjunction with the Senate Health, Education, Labor, and Pensions (HELP) Committee, will hold a joint oversight hearing concerning implementation of the President’s Executive Order regarding chemical facility safety and security.

Lawmakers Near Deal on TRIA; CFTC to Host Meeting of Agriculture Advisory Committee

Posted in Financial Services

Legislative Activity

Lawmakers Near Deal on TRIA, May Consider Insurance Capital Standards

As the legislative session draws to a close, it appears that lawmakers in the Senate and House are nearing a deal to reauthorize the Terrorism Risk Insurance Act (TRIA), which is set to expire at the end of the year. While there has been much discussion about a short-term TRIA reauthorization, it seems that lawmakers have been able to reach agreement on most issues that would prevent a longer-term reauthorization.  Nevertheless, certain issues must still be resolved. In particular, Democrats are insisting that House Financial Services Committee Chairman Jeb Hensarling (R-TX) drop his demands for $3.5 billion in budget cuts to pay for TRIA.

It is also possible this week that lawmakers may consider legislation on insurance capital standards that would amend the Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank Act) and ensure that bank-like risk-based capital standards are not applied to insurers.

This Week’s Hearings:

  • Tuesday, December 9: The Senate Banking Subcommittee on Housing, Transportation, and Community Development will hold a hearing titled “Inequality, Opportunity, and the Housing Market.”
  • Wednesday, December 10: The Senate Banking Committee will hold a hearing titled “Cybersecurity: Enhancing Coordination to Protect the Financial Sector.”
  • Wednesday, December 10: The Senate Agriculture Committee will hold a hearing titled “The Commodity Futures Trading Commission: Enforcement and the Future of Derivatives Regulation.”  Note that Commodity Futures Trading Commission (CFTC) Chairman Timothy Massad will be the sole witness at the hearing.

Regulatory Activity

CFTC to Hold Meeting of Agriculture Advisory Committee

On Tuesday, December 9, the CFTC will hold a meeting of its Agricultural Advisory Committee (AAC). The meeting will focus on issues related to deliverable supplies of agricultural commodities, as they pertain to position limits, and the agricultural economy.

House Oversight Hearing on Obamacare Transparency; ACO Proposed Rule Released

Posted in Health Care

Legislative Activity

With the end of the year in sight, Congress remains busy in the health policy arena. Partisan talking points are expected to fly on Tuesday, when Chairman Darrell Issa (R-CA) will chair one of his final hearings in the House Committee on Oversight and Government Reform focused on the Affordable Care Act. Economist Jonathan Gruber, who has been reported as saying the “stupidity of the American voter” aided the White House in passing the health reform law, is expected to appear before the Committee. Marilyn Tavenner, Administrator of the Centers for Medicare and Medicaid Services (CMS), is also expected to testify. Administrator Tavenner will likely be asked about Obamacare implementation issues, including the misreported Obamacare enrollment figures that came to light after the midterm elections.

Washington continues to focus on the global treatment of Ebola. This past week, the Centers for Disease Control and Prevention identified a preliminary list of hospitals that have the resources, capacity, and preparation to treat Ebola patients. President Barack Obama is pressing Congress to authorize $6.2 billion in emergency funding to fight the virus in the United States and abroad. The Senate Committee on Foreign Relations, Subcommittee on African Affairs will also hold a hearing to hear testimony on keys to success for the international response.

Some lawmakers and outside groups are requesting a delay of the ICD-10 coding system implementation, which was originally set for 2013. If this movement gains enough traction, applicable delay language may be attached to a spending bill or other significant legislation.

While a permanent sustainable growth rate (SGR) patch is not expected to be passed before the holidays, such legislation will likely be taken up in the first months of the 114th Congress, before the current patch expires on March 31, 2015.

This Week’s Hearings:

  • Tuesday, December 9: The House Committee on Oversight and Government Reform will hold a hearing titled “Examining Obamacare Transparency Failures.” The House Committee on Energy and Commerce, Subcommittee on Health will hold a hearing titled “Setting Fiscal Priorities.”
  • Wednesday, December 10: The House Committee on Energy and Commerce, Subcommittee on Health will hold a hearing titled “Examining FDA’s Role in the Regulation of Genetically Modified Food Ingredients.” The Senate Committee on Foreign Relations, Subcommittee on African Affairs will hold a hearing titled “The Ebola Epidemic: The Keys to Success for the International Response.”

Regulatory Activity

Accountable Care Organization (ACO) Proposed Rule Released

On Monday, December 1, CMS released the “Medicare Program; Medicare Shared Savings Program: Accountable Care Organizations” Proposed Rule. This proposed rule provides modifications to Accountable Care Organizations (ACOs) under the Medicare Shared Savings Program. The proposed rule makes changes to the current program by: clarifying and establishing new definitions of terms; adding a procedure for ACOs to renew their participation agreements; adding, clarifying, and revising the beneficiary assignment algorithm; expanding the types of beneficiary-identifiable data that would be given to ACOs in reports under the program, as well as simplifying the opt-out process for claims data sharing; and adding or modifying policies to encourage increased participation in risk-based models. Amongst other requests, CMS is soliciting comments from ACOs and other stakeholders on the use of telehealth technologies for the coordination of care for assigned beneficiaries.