H.R. 5485, Financial Services and General Government Appropriations Act, 2017

H.R. 5485

Financial Services and General Government Appropriations Act, 2017

Committee
Appropriations

Date
June 22, 2016 (114th Congress, 2nd Session)

Staff Contact
John Huston

Floor Situation

On Wednesday, June 22, 2016, the House will begin consideration of H.R. 5485, Financial Services and General Government Appropriations Act, 2017, under a structured rule. The bill was introduced by Rep. Ander Crenshaw (R-FL) and was reported by the Committee on Appropriations as an original measure on June 15, 2016.

Bill Summary

H.R. 5485 appropriates $21.7 billion in funding – $1.5 billion below the fiscal year 2016 enacted level and $2.7 billion below the President’s budget request for the Treasury Department, the Judiciary, the Small Business Administration, the Securities and Exchange Commission, and other related agencies. Major provisions of the bill include:[1]

Internal Revenue Service (IRS) – The bill provides $10.9 billion for the IRS – a cut of $236 million below the fiscal year 2016 enacted level and $1.3 billion below the President’s budget request. This holds the agency’s budget to below the 2008 level. The bill maintains the current level – $2.1 billion – for Taxpayer Services and provides an additional $290 million to improve customer service – such as phone call and correspondence response times – fraud prevention, and cybersecurity.

To address concerns related to recent IRS transgressions, the bill includes:

  • A prohibition on a proposed regulation related to political activities and the tax-exempt status of 501(c)(4) organizations. The proposed regulation could jeopardize the tax-exempt status of many nonprofit organizations and inhibit citizens from exercising their right to freedom of speech;
  • A prohibition on funds for bonuses or to rehire former employees unless employee conduct and tax compliance is given consideration;
  • A prohibition on funds for the IRS to target groups for regulatory scrutiny based on their ideological beliefs;
  • A prohibition on funds for the IRS to target individuals for exercising their First Amendment rights;
  • A prohibition on funds for the production of inappropriate videos and conferences;
  • A prohibition on funds for the White House to order the IRS to determine the tax-exempt status of an organization; and
  • A requirement for extensive reporting on IRS spending.

Judiciary – Included in the bill is $7.0 billion for the federal courts – an increase of $177 million above the fiscal year 2016 enacted level. This includes operational funding for federal court activities, to improve public safety through the supervision of offenders and defendants, to bolster the security of courtrooms and facilities, and to improve the speed and efficiency of processing federal cases.

Small Business Administration (SBA)  The bill contains $883 million for the SBA to help promote opportunities for American small businesses to begin, grow, and thrive. This includes full funding – $157 million – to support $28.5 billion in 7(a) and $7.5 billion in 504 small business loans.

General Services Administration (GSA) – The bill provides $9.2 billion out of the Federal Buildings Fund for the GSA, a reduction of $951 million below the fiscal year 2016 enacted level. Savings and reductions were made primarily within GSA’s new construction account. In addition, the bill helps to save taxpayer dollars and reduce the federal footprint by providing funds for space consolidation and property disposal. The funding includes $200 million to continue the construction of a new Federal Bureau of Investigation headquarters.

Securities and Exchange Commission (SEC) – Included in the bill is $1.5 billion for the Securities and Exchange Commission (SEC), which is $50 million below the fiscal year 2016 enacted level and $226 million below the President’s budget request. The bill focuses this funding on critical information technology initiatives and its economics division to help the Commission better serve investors. The bill rescinds the unobligated balances of the SEC’s “reserve fund” – a slush fund created under Dodd-Frank from which the SEC can freely spend without congressional oversight.

Consumer Financial Protection Bureau (CFPB) – The bill includes a provision to increase oversight over the CFPB by bringing funding for the agency under the annual congressional appropriations process, instead of direct funding from the Federal Reserve. This change will allow for increased accountability and transparency of the agency’s activities and use of tax dollars. The legislation also changes the leadership structure of the CFPB from a single Director to a five-member Commission, and requires the CFPB to study the use of pre-dispute arbitration prior to issuing regulations.

Federal Communications Commission (FCC) – The bill contains $315 million for the FCC – a cut of $69 million below the fiscal year 2016 enacted level and $43 million below the request. The legislation prohibits the FCC from implementing the net neutrality order until certain court cases are resolved, requires newly proposed regulations to be made publicly available for 21 days before the Commission votes on them, prohibits the FCC from regulating broadband rates, and requires the FCC to refrain from further activity of the recently proposed set-top box rule until a study is completed.

Executive Office of the President (EOP)  The legislation contains $692 million for the EOP, which is $171 thousand above the fiscal year 2016 enacted level. The bill denies the President’s proposed cuts of $70 million to drug control efforts, including the High-Intensity Drug Trafficking Areas (HIDTA) and Drug-Free Communities programs, and instead increases funding for these programs by $5 million above the fiscal year 2016 enacted level. The bill also includes a requirement that the Office of Management and Budget release information on the expected costs of Executive Orders and Presidential Memorandums.

District of Columbia  The bill contains a $725 million federal payment to the District of Columbia – which is $4.6 million below the fiscal year 2016 enacted level and $38 million below the request. Within this amount, the bill targets resources on public safety and security costs, and other essential services. It also includes $45 million for scholarships to low-income students in DC to attend private schools, and reauthorizes the program through 2021 as well as the text of H.R. 4901, Scholarships for Opportunity and Results Reauthorization Act, which passed the House on April 29, 2016, by a roll call vote of 224-181. The bill also repeals the Local Budget Autonomy Amendment Act and includes the text of H.R. 5233, Clarifying Congressional Intent in Providing for DC Home Rule Act, which passed the House on May 26, 2016, by a roll call vote of 240-179 and it continues to appropriate the District’s local funds.

DC Marijuana & Needle Exchange – The legislation maintains provisions prohibiting federal and local funds from being used for abortion or to further marijuana legalization, and it maintains a prohibition on federal funds from being used for needle exchanges in the District of Columbia.

Presidential Transition – The bill provides one-time funding increases for the presidential transition for the Executive Office of the President ($7.6 million), General Services Administration ($9.5 million), National Archives and Records Administration ($4.9 million), and Federal Payment for Emergency Planning and Security in the District of Columbia ($25 million).

ObamaCare – The bill also includes provisions to stop the IRS from further implementing ObamaCare, including a prohibition on any transfers of funding from the Department of Health and Human Services to the IRS for ObamaCare uses, and a prohibition on funding for the IRS to implement an individual insurance mandate on the American people. The bill also prohibits funding for abortions through OPM-negotiated “multi-state qualified health plans” offered under Obamacare.

Other Legislative Provisions – The legislation contains several policy provisions, including:

  • A prohibition against the use of funds for abortion in the Federal Employee Health Benefits program;
  • A prohibition on funding to require that entities applying for or conducting work under federal contracts disclose campaign contributions;
  • Several prohibitions related to Cuba, including a prohibition on travel to Cuba for certain educational exchanges, a prohibition on the importation of property confiscated by the Cuban Government, a prohibition on financial transactions with the Cuban military or intelligence service, and a prohibition on funds to approve the licensing of a mark, trade name, or commercial name that was confiscated by the Cuban Government without express consent;
  • A prohibition on funds for a pay increase for the Vice President and other senior political appointees; and
  • A prohibition on funding to implement an Executive Order on flood management until certain conditions are met.

Other Provisions –

The bill includes H.R. 3784, the SEC Small Business Advocate Act, which creates an office within the SEC and establishes an advisory committee to identify challenges that are unique to small businesses. The bill passed the House by voice vote on February 1, 2016.

The bill also includes H.R.2947the Financial Institution Bankruptcy Act, which makes changes to the U.S. bankruptcy code to facilitate the orderly and efficient resolution of a failing financial firm. The bill passed the House by voice vote on April 12, 2016.

United States Postal Service Mail Delivery Standards – The bill restores mail delivery standards to the July 1, 2012, level, which would restore overnight mail delivery within metropolitan areas and towns, and re-establish the two- and three-day delivery standards for first-class mail and periodicals that were eliminated in 2015.[2]

CFPB Payday Lending Rule – The bill prohibits funding for the CFPB to finalize or implement a rule that would restrict payday lending until the CFPB completes a report, with public comment, on the impact of the rule on populations with limited access to credit, and until it identifies existing credit products available to replace the current sources of short-term, small-dollar credit.

Manufactured Housing The bill revises the definition of a high-cost mortgage and mortgage originator as those terms apply to manufactured housing. The Committee on Financial Services found that the new tests in determining if a loan is “high cost” have resulted in reduced access to credit for consumers of affordable manufactured and modular housing.[3] Due to increased lender liability associated with making small-balance loans applicable to HOEPA standards, some lenders reduced or stopped providing such loans to some consumers. This provision is similar to provisions H.R. 650, the Preserving Access to Manufactured Housing Act of 2015, which passed the House on April 14, 2015, by a vote of 263 to 162.

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[1] See Appropriations Committee Press Release, “Appropriations Committee Releases Fiscal Year 2017 Financial Services Bill,” May 24, 2016.
[2] See Post & Parcel Article, “House Appropriations Committee votes for amendment to restore mail delivery standards,” June 10, 2016.
[3] Id.

Background

The Financial Services and General Government (FSGG) appropriations bill includes funding for the Department of the Treasury, the Executive Office of the President (EOP), the judiciary, the District of Columbia, and more than two dozen independent agencies. The House and Senate FSGG bills fund the same agencies, with one exception. The Commodities and Futures Trading Commission (CFTC) is funded through the Agriculture appropriations bill in the House and the FSGG bill in the Senate. This structure has existed since the 2007 reorganization of the House and Senate Committees on Appropriations.[1]

According to the bill sponsor, Rep. Crenshaw, “Federal agencies have a duty and obligation to use hard-earned taxpayer dollars in the most effective and efficient manner. Americans work hard for the money they send to Washington and expect their legislators to make the same tough budget decisions that they have made. Our bill is the product of comprehensive hearings with input from both sides of the aisle with an emphasis on economic growth and job creation through small businesses, while bolstering law enforcement to protect our citizens. [. . .] In addition, our bill reduces funding for agencies that we believe can produce results with fewer dollars. And, where there is a history of inappropriate behavior, such as the Internal Revenue Service, cutbacks and reforms are recommended to hold them accountable.”[2]

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[1] See CRS Report, “Financial Services and General Government (FSGG) FY2016 Appropriations: Overview,” June 8, 2016.
[2] See Appropriations Committee Press Release, “Appropriations Committee Releases Fiscal Year 2017 Financial Services Bill,” May 24, 2016.

Cost

The bill appropriates $21.7 billion in funding.

Amendments

  1. Keith Ellison (D-MN) – This amendment reprograms already appropriated funds to create an Office of Good Jobs for the Department of Treasury.
  2. Sean Duffy (R-WI) – This amendment decreases by $20.7 million the Community Development Financial Institutions (CDFI) account to offset an inappropriate augmentation of this account outside of the congressional appropriations process by the Department of Justice through settlement agreements which required banks to donate $20.7 million to certified CDFI entities.
  3. Rep Xavier Becerra (D-CA) – This amendment strikes Section 127, which prevents the IRS from issuing guidance to more clearly define political activity for 501(c)(4) organizations.
  4. Keith Ellison (D-MN) – This amendment strikes restrictions on the Consumer Financial Protection Bureau’s ability to promulgate rules restricting pre-dispute mandatory arbitration agreements in consumer contracts with firms offering financial products.
  5. Gwen Moore (D-WI) – This amendment strikes Section 501 to preserve the independent funding and transfer of funds from the Federal Reserve to Consumer Financial Protection Bureau.
  6. Gwen Moore (D-WI) – This amendment strikes Section 503 to preserve the independent funding and transfer of funds from the Federal Reserve to Consumer Financial Protection Bureau.
  7. Gwen Moore (D-WI) – This amendment strikes Section 505 to preserve the current management structure of the Consumer Financial Protection Bureau under a single Director.
  8. Dave Brat (R-VA) – This amendment designates $3 million from existing National Archives and Records Administration funds to coordinate the digital publication of the U.S. Statutes at Large under 1 U.S.C. 112.
  9. Sean Duffy (R-WI) – This amendment increases funding for the SEC’s Division of Enforcement to investigate instances of possible market abuse whereby pharmaceutical innovators’ patents are disputed and then their stock is shorted.
  10. Jim Himes (D-CT) – This amendment increases funding for the SEC by $50 million.
  11. Peter DeFazio (D-OR) – This amendment decreases funding for the Selective Service System by $22,703,000 and increases the spending reduction account by the same amount.
  12. Alan Grayson (D-FL) – This amendment strikes section 613.
  13. Dan Kildee (D-MI) – This amendment strikes Section 625 of the bill, a provision that prevents the SEC from developing or finalizing a rule that requires the disclosure of political contributions to tax exempt organizations.
  14. Anna Eshoo (D-CA) – This amendment strikes section 632.
  15. Keith Ellison (D-MN) – This amendment strikes section 637.
  16. Keith Ellison (D-MN) – This amendment strikes section 638.
  17. Terri Sewell (D-AL) – This amendment strikes section 639, which prohibits funds from being used by the Bureau of Consumer Financial Protection (CFPB) to enforce regulations or rules with respect to payday loans, vehicle title loans, or other similar loans during FY 2017.
  18. Mark DeSaulnier (D-CA) – This amendment strikes section 735 (relating to Federal election contributions).
  19. Eleanor Holmes Nortion (D-DC) – This amendment strikes the repeal of the District of Columbia budget autonomy referendum.
  20. Mark Amodei (R-NV) – This amendment prohibits funds from being used to enforce the requirement in section 316(b)(4)(D) of the Federal Election Campaign Act that solicitation of contribution from member corporations’ stockholders or personnel from a trade association be separately and specifically approved by the member corporation involved prior to the solicitation, and that such member corporations does not approve any such solicitation by more than one trade association in any calendar year.
  21. Marsha Blackburn (R-TN) – This amendment prohibits funds made available by the Act from being used to implement, administer or enforce any of the rules proposed in the Notice of Proposed Rulemaking adopted by the FCC on March 31, 2016 (FCC 16-39), intended to regulate consumer privacy obligations as necessitated by the FCC’s net neutrality regime.
  22. Marsha Blackburn (R-TN) – This amendment provides for a one percent across the board cut to the bill’s discretionary spending levels.
  23. Ken Buck (R-CO) – This amendment reduces the salary of the IRS Commissioner to $0 annually from date of enactment through January 20, 2017.
  24. Rick Crawford (R-AR) – This amendment prohibits funds from being used to implement, administer or enforce Section 902(b) of the Trade Sanction Reform and Export Enhancement Act of 2000 which requires agriculture commodities sales to Cuba be carried out on a cash basis.
  25. Warren Davidson (R-OH) – This amendment prohibits the use of funds to change the Selective Service System registration requirements.
  26. Sean Duffy (R-WI) – This amendment prohibits funds from being used to implement, administer, or enforce a new regulatory action of $100 million or more.
  27. Sean Duffy (R-WI) – This amendment prohibits funds from being used with respect to the case Rainey v. Merit Systems Protection Board.
  28. Scott Garrett (R-NJ) – This amendment prohibits the Securities and Exchange Commission from proposing or implementing a rule that mandates the use of universal proxy ballots during proxy contests.
  29. Scott Garrett (R-NJ) – This amendment prohibits the use of funds to designate any nonbank financial company as “too big to fail” or as a “systemically important financial institution” or to make a determination that material financial distress at a nonbank financial company could pose a threat to U.S. financial stability.
  30. Paul Gosar (R-AZ) – This amendment prohibits the use of funds to pay a performance bonus to any senior IRS employee.
  31. Paul Gosar (R-AZ) – This amendment prohibits the use of funds made available by this Act to be used to provide financial assistance to Sanctuary Cities.
  32. Frank Guinta (R-NH) – This amendment makes no funds available to the CFPB to enforce or administer guidance pertaining to indirect auto lending.
  33. Richard Hudson (R-NC) – This amendment prohibits funding to propose or finalize a regulatory action until January 21, 2017.
  34. Bill Huizenga (R-MI) – This amendment states no funds appropriated in this Act may be used to enforce a SEC rule pursuant to Section 1502 of DoddFrank relating to “conflict minerals.”
  35. Bill Huizenga (R-MI) – This amendment states no funds shall be made available to finalize, implement, administer, or enforce the Securities and Exchange Commission’s Pay Ratio Disclosure rules.
  36. Steve King (R-IA) – This amendment blocks the federal government from borrowing money.
  37. Leonard Lance (R-NJ) – This amendment prohibits funds from being used to give Iran access to the U.S. dollar.
  38. Steve King (R-IA) – This amendment defunds an Executive Order which directs Federal agencies to provide foreign-language services to anyone who might seek to engage with federal, state, and local governments.
  39. Blaine Luetkemeyer (R-MO) – This amendment prohibits funding for Operation Choke Point.
  40. Luke Messer (R-IN) – This amendment prohibits funds from being used by the CFPB to commence any administrative adjudication or civil action beyond the 3 year statute of limitation established by the Dodd-Frank Wall Street Reform and Consumer Protection Act.
  41. Gary Palmer (R-AL) – This amendment prohibits funds from being used to implement D.C.’s Reproductive Health Non-Discrimination Amendment Act (RHNDA).
  42. Bruce Poliquin (R-ME) – This amendment ensures paper statement delivery of financial reporting information by prohibiting funds for the Security and Exchange Commission’s (SEC) Proposed Rule 30e-3 from allowing mutual funds to switch to digital delivery of financial reporting information, unless the investor affirmatively objects.
  43. Mike Pompeo (R-KS) – This amendment prohibits funds from being used to finalize, implement, administer or enforce CPSC’s proposed rule on Voluntary Remedial Actions and Guidelines for Voluntary Recall Notices.
  44. Bill Posey (R-FL) – This amendment prohibits funds under this Act from being used to implement, administer, enforce, or codify into regulation, the SEC’s guidance relating to “Commission Guidance Regarding Disclosure Related to Climate Change”
  45. Peter Roskam (R-IL) – This amendment prohibits any funds from being used to issue a license pursuant to any Office of Foreign Assets Control (OFAC) memo regarding section 5.1.1 of Annex II to the JCPOA, including the OFAC memo titled, “Statement of Licensing Policy For Activities Related to the Export Or Re-Export to Iran of Commercial Passenger Aircraft and Related Parts and Services’’ and any other OFAC memo of the same substance.
  46. Peter Roskam (R-IL) – This amendment prohibits any funds from being used to authorize a transaction by a U.S. financial institution (as defined under section 561.309 of title 31, Code of Federal Regulations) that is ordinarily incident to the export or re-export of a commercial passenger aircraft to the Islamic Republic of Iran.
  47. Mark Sanford (R-SC) – This amendment prohibits the use of funds to enforce regulations limiting the rights of Americans to travel to Cuba.
  48. Lee Zeldin (R-NY) – This amendment prohibits funds from being used by the GSA to market or sell Plum Island, NY.
  49. Peter DeFazio (D-OR) – This amendment prohibits funds from being used to administer the Selective Service System.
  50. John Delaney (D-MD) – This amendment extends the redesignation period for HUBZones to 7 years.
  51. Ron DeSantis (R-FL) – This amendment prohibits funds made available by the Act to be used to pay final judgments, awards, compromise settlements, or interest and costs specified in the judgments to Iran using amounts appropriated under section 1304 of title 31, United States Code, or interest from amounts appropriated under such section.
  52. Ron DeSantis (R-FL) – This amendment would prohibit funds made available by the Act to be used to circumvent the conditions of Section 104 of the Comprehensive Iran Sanctions, Accountability, and Divestment Act of 2010.
  53. Hakeem Jeffries (D-NY) – This amendment precludes the relocation of an Office of Disability Adjudication and Review, of the Social Security Administration, away from the population center it mainly serves.
  54. John Yarmuth (D-KY) – This amendment prohibits funds from being used in contravention of Section 317 of the Communications Act of 1934.
  55. Sean Duffy (R-WI) – This amendment decreases by $1 million Department of the Treasury salaries and expenses and transfers the same amount to the spending reduction account.
  56. Alan Grayson (D-FL) – This amendment increases the minimum funding level for Tax Counseling for the Elderly by 50%.
  57. Grace Meng (D-NY) – This amendment increases funding for Tax Counseling for the Elderly by $1.5 million.
  58. Evan Jenkins (R-WV) – This amendment increases funding for the High Intensity Drug Trafficking Areas (HIDTA) by $2 million with an offset.
  59. Barbara Comstock (R-VA) – This amendment increases resources for the High Intensity Drug Trafficking Areas (HIDTA) Program, offset by resources for GSA rental space.
  60. Jackie Speier (D-CA) – This amendment increases funding for the Federal Trade Commission by $1 million for additional enforcement of the Do Not Call Registry and education for the public about avoiding telemarketer deception and abuse.
  61. Jim Himes (D-CT) – This amendment increases funding for the Privacy and Civil Liberties Oversight Board by $1,784,000.
  62. Kathleen Rice (D-NY) – This amendment increases funding for the Office of Special Counsel (OSC) by $800,000.
  63. Stephen Lynch (D-MA) – This amendment increases funding for the Financial Crimes Enforcement Network (FinCEN) by $3,300,000.
  64. Tim Walberg (R-MI) – This amendment increases funding for the High Intensity Drug Trafficking Area program (HIDTA) by $2 million.
  65. Gerry Connolly (D-VA) – This amendment reduces the General Services Administration’s Federal Building Fund Rental of Space Account by $5 million and increases the IT Oversight and Reform Office by $5 million.
  66. Grace Meng (D-NY) – This amendment increases funding for Small Business Development Centers by $5 million.
  67. Eliot Engel (D-NY) – This amendment prohibits funds made available by this Act from being used to lease or purchase new light duty vehicles unless those vehicles meet the requirements of President Obama’s May 24, 2011 Executive Order on Federal Fleet Performance.
  68. Ruben Gallego (D-AZ) – This amendment specifies that no funds may be used to revise any policy or directive related to hiring preferences for veterans of the Armed Forces.
  69. Alan Grayson (D-FL) – This amendment prohibits the government from entering into a contract with an entity that discloses, as it is required to by the Federal Acquisition Regulation, that it has been convicted of fraud or another criminal offense in the last three years in connection with obtaining, attempting to obtain, or performing a public contract or subcontract. Prohibits the government from contracting with entities that have been notified of any delinquent Federal taxes for which the liability remains unsatisfied.
  70. Vicky Hartzler (R-MO) – This amendment prohibits the CFPB from implementing any contract with a vendor to provide informational messages.

Additional Information

For questions or further information please contact John Huston with the House Republican Policy Committee by email or at 6-5539.