Legislative Activity

House, Senate Set to Move on Short-Term Highway Funding Extension

As tax-writers continue their push for tax reform this Congress, the focus this week will shift to providing a short-term extension of funding for the Highway Trust Fund. In the Senate, Finance Committee Chairman Orrin Hatch (R-UT) and Environmental and Public Works Committee Chairman Jim Inhofe (R-OK) appear to have coalesced around a plan to provide for an $11 billion extension of the Highway Trust Fund, which would fund the nation’s infrastructure through December 31 of this year. While exactly how their proposal would be funded remains unclear, it appears that a gas tax hike is off the table. As Representative Rosa DeLauro (D-CT) stated last week, “you cannot pass a gas tax. There isn’t going to be anyone that’s going to vote for an increase in the gas tax.” Lawmakers supporting an end of the year extension have suggested that funding the Highway Trust Fund through the end of the year will provide them sufficient time to come up with long-term funding for the program.

In a separate camp, Democrats (and some Republicans) who are skeptical of an end of the year extension will make strides this week to pass a two-month extension of the program, which would extend highway funding authority through July 31. The House-version of the proposal, which was introduced by Ways and Means Committee Chairman Paul Ryan (R-WI) and Transportation and Infrastructure Committee Chairman Bill Shuster (R-PA), is expected to be considered on the floor this week once the House Rules Committee reviews the legislation (H.R. 2353) later today. On the Senate side, Senators Barbara Boxer (D-CA) and Tom Carper (D-DE) have introduced a similar proposal (S. 1350), which Senate Majority Leader Mitch McConnell (R-KY) has announced will be fast-tracked and is likely to receive floor consideration this week. Lawmakers pursuing this route are hoping to put pressure on lawmakers to work toward a long-term extension of the Highway Trust in the near-term.

With Highway Trust Fund funding set to expire on May 31, and lawmakers scheduled to leave Washington at the end of the week for the Memorial Day recess, this issue is likely to stay front and center throughout the week.

JCT Struggling with Dynamic Scoring

Recently, Tom Barthold, Chief of Staff, Joint Committee on Taxation (JCT) announced that the JCT is struggling with how to arrive at a point estimate, rather than a range of estimates, when required to use dynamic scoring methods to score proposed legislation. Moreover, he noted that staff is still trying to determine “what [] extra information should be [collected]” for purposes of dynamic scoring.

Regulatory Activity

TIGTA Issues Report on Improper ACA Tax Credits

Last week, the Treasury’s Inspector General for Tax Administration (TIGTA) issued a report on improper Premium Tax Credit (PTC) payments, which are offered to qualified taxpayers under the Affordable Care Act (ACA) to help them afford health insurance purchased through insurance exchanges. According to the report, “[b]ecause the IRS and the Department of Health and Human Services are responsible for the administration of the PTC, improper PTC payments can result from weaknesses in either agency’s programs. As a result, the IRS cannot effectively assess the risk of PTC improper payments, estimate the improper payment rate and dollars, or establish corrective actions to address the causes of and reduce improper PTC payments.” In response, the IRS suggested that TIGTA “mischaracterized” the agency’s efforts and underscored that they are “working jointly” with the Centers for Medicare and Medicaid Services, the Department of Health and Human Services, the Department of the Treasury, and the Office of Management and Budget on an “interagency effort to develop the definition of an improper payment” with respect to the PTC, as well as to “develop plans for assessing risks.”