H.R. 6517: Omnibus Trade Act of 2010

H.R. 6517

Omnibus Trade Act of 2010

Sponsor
Rep. Sander M. Levin

Date
December 15, 2010 (111th Congress, 2nd Session)

Staff Contact
Communications

Floor Situation

H.R. 6517 is expected to be considered on the floor of the House on Wednesday, December 15, 2010, under a motion to suspend the rules, requiring a two-thirds majority vote for passage.  The legislation was introduced on December 13, 2010, by Rep. Sander Levin (D-MI). 

Bill Summary

H.R. 6517 would extend the Generalized System of Preferences (GSP), the Andean Trade Preferences Act (ATPA), and the Trade Adjustment Assistance Act.  It also would implement temporary suspensions or reductions of tariffs on certain imports and extends certain already existing provisions.  Finally, it would make a limited and temporary adjustment to the Wool Trust Fund.

Extension of Generalized System of Preferences and Andean Trade Preferences Act:  The legislation would extend the GSP and ATPA programs until June 30, 2012.  Both of these programs are scheduled to expire at the end of this year.

The legislation would require an annual report be submitted to Congress to assess how the beneficiary countries, particularly Ecuador, are complying with the program’s eligibility criteria.

Extension of Trade Adjustment Assistance
:  The bill would extend, until June 30, 2012, the Trade and Globalization Adjustment Assistance Act of 2009, which expanded the TAA program.  The current authorization expires on December 31, 2010. 

The version of the bill being considered would delay, until at least July 2012, a controversial Labor Department rule mandating that states use only state “Employment Service” employees to administer TAA-funded benefits and services.  Unless the bill is enacted, the Department’s mandate will immediately prevent 27 states from being able to continue to use a mix of staff at their discretion to provide TAA services. 

The bill would also make modifications to the community college and career training grant program authorized by the 2009 law and authorizes five percent of grant funds for the U.S. Department of Labor to administer this program.

Temporary Duty Suspensions and Reductions:  The legislation would extend or implement 299 temporary duty suspensions or reductions.  The purpose of these provisions is to help U.S. manufacturers compete at home and abroad by lowering costs on intermediate products or materials and some finished products that are not made domestically.  The duty reductions would be available to any firm that imports the product and are not limited to any specific firm.

Adjustment to the Wool Trust Fund:  The legislation would make a temporary adjustment to ensure that the Wool Apparel Manufacturers Trust Fund is sufficiently funded, but does not extend the fund, which is currently authorized through 2014.

Background

Some Members may be concerned that this legislation contains earmarks as defined by House Rules.  The House Republican Conference has adopted a moratorium on all earmarks.  According to the resolution adopted by the Conference and House Rules, a limited tariff benefit—meaning a provision modifying the Harmonized Tariff Schedule of the U.S. in a manner that benefits 10 or fewer entities—is an earmark. 

The Generalized System of Preferences (GSP) is the largest U.S. trade preference program and provides trade preferences to over 130 countries.  Many U.S. companies source raw materials and other inputs from GSP countries, and the duty-free treatment of these imports reduces the production costs of these U.S. manufacturers, making them more competitive.

Extension of the Andean Trade Preferences Act (ATPA) for Colombia would prevent a substantial increase in import duties on imports from Colombia while Colombia awaits Congressional action on the U.S.-Colombia Trade Promotion Agreement.

The legislation does not extend ATPA for Peru because the U.S.-Peru Trade Promotion Agreement has been implemented and the U.S. generally does not continue trade preference program benefits for FTA partner countries.

 

 

Cost

According to Ways and Means Committee Republicans, the Congressional Budget Office (CBO) has estimated the cost of the bill at approximately $2.5 billion and the cost of the bill is fully offset by an extension of existing custom user fees.