Capitol View VOLUME 3, NUMBER 2 MARCH 2005 Four Seats When the 109th Congress convened in January of this year, Republicans in the Senate controlled four more seats than they had in the 108th Congress. This relatively small shift from 51 to 55 Republican Senators has had a significant impact on the ability of the Republicans to pass some of their high priority legislation. A number of these bills had been stalled in the Senate for many years over several Sessions of Congress. On Thursday, March 10, the Senate voted to pass the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005 (S.256) by a vote of 74-25. This was the culmination of eight years of efforts led by some banks and credit card companies to make it more difficult for individuals to eliminate the payment of all debts by declaring bankruptcy. Under the legislation passed by the Senate, some consumers who in the past could liquidate all debt through a Chapter 7 bankruptcy proceeding would be placed in a repayment plan under a Chapter 11 or a Chapter 13 proceeding. The bill establishes a means test to determine if certain bankruptcy filers have sufficient financial resources to repay some or all of their debts. During two weeks of debate on the Senate Floor, proponents of S.256 were able to defeat all significant amendments to the underlying bill. This had not been the case in the past. One of the more contentious amendments was offered by Senator Charles Schumer (D-NY). It would have barred violent protestors, including those directed at abortion clinics, from discharging court ordered fines or monetary judgments through bankruptcy proceedings. The Schumer Amendment was defeated by a vote of 46-53. The inclusion of similar language in the bankruptcy reform bills in the 107th and 108th Congress generated enough opposition to prevent final enactment. The House Judiciary Committee voted to approve the identical bankruptcy reform language on March 16 by a vote of 22-13. All attempts to amend the bill in Committee failed. The full House will likely consider the measure when Congress returns from its Spring Recess during the week of April 4. Since both the Senate and House will have passed the same bills, no conference will be needed. President Bush has stated he will sign the bankruptcy reform bill. President Clinton exercised a pocket veto over similar legislation five years ago. Another long standing priority of the Republican Leadership was advanced on March 16 when the Senate voted by 49-51 to reject an amendment offered by Senators Maria Cantwell (D-WA) and John Kerry (D- MA) which would have removed a provision in the Concurrent Resolution on the Budget for FY2006 (S. Con. Res. 18) recognizing $2.5 billion in revenues from plans for oil and gas development in the Arctic National Wildlife Refuge (ANWR) in Alaska. Some Members of the Senate have lobbied for oil and gas exploration in ANWR for the past 10 years but the budget resolution vote was the first time these efforts had led to success in that body. VALUE ADDED, VALUES DRIVEN.SM CAPITOL VIEW MARCH 2005 2 However, this issue is far from being finally resolved. Although it may be included in the non-binding budget resolution it will not become law unless ANWR exploration is included in the subsequent budget reconciliation legislation that the President actually signs. Nevertheless, the vote on ANWR in the budget resolution is illustrative of the increased Republican strength in the Senate. In 2003, when there were 49 Senate Democrats rather than 44, opponents of ANWR exploration were able to remove a similar provision by a vote of 52-48. Supporters of class action reform have been actively pursuing such legislation over the last three Congresses. Their long-standing efforts finally saw success in the opening weeks of the 109th Congress. The increased Republican Senate majorities eased Senate passage of the Class Action Fairness Act of 2005 (S. 5). The Act amends the Federal diversity of citizenship jurisdiction statute to make it easier for the defendants in large multi-state class actions to remove these suits from state to Federal court. In previous Congresses, similar legislation passed the House but was bogged down in the Senate. (See a more detailed article on class action reform in the February 2005 edition of Capitol View.) President bush signed the bill into law on February 18. The increase in Republican seats has also made implementation of a rule change, or a rule clarification, governing filibusters of the President's judicial nominees more likely. With four more Senators now in the Republican Caucus, Majority Leader Frist may feel he is more likely to succeed than he had been in the 108th Congress when he only had a 51-member Caucus in instituting what he calls the "Constitutional Option" and what the Senate Democrats have termed the "Nuclear Option." While there is some disagreement between Democrats and Republicans over the issue of whether filibusters have been used in the past to oppose a President's judicial nominees, there is no doubt they are being increasingly employed by Senate Democrats to oppose President Bush's appointments to the Federal judiciary. In the 108th Congress, Democrats filibustered 10 of the President's nominees to various Circuit Courts of Appeals and thus required the Majority Leader to produce 60 votes to invoke cloture. None of the 10 nominees was able to overcome the 60 vote obstacle. President Bush has already resubmitted seven of these nominees to the Senate in the 109th Congress. Senator Frist has stated that while filibusters may be appropriate for the Senate when it considers legislation, they infringe on the President's authority to appoint judges when they are employed in the Senate's "advise and consent" considerations. Frist may therefore seek a ruling from the President of the Senate that only a simple majority is needed to end debate on judicial nominees or to clarify Senate rules to the same end. The Majority Leader will need 51 votes to sustain this parliamentary maneuver. Senate Democrats have threatened to shut down most of the work of the Senate if the Republicans implement this procedure. The switch of four Senate seats in the 2004 elections has already had a significant impact on major pieces of legislation in the opening weeks of the 109th Congress. How long this will continue is difficult to predict. If disagreements over the judicial confirmation process are not resolved and the Majority Leader exercises his "Constitutional" or "Nuclear" option, the legislative process in the Senate may be severely curtailed. It is thought that if Senator Frist concludes he needs to implement this option he would likely do so in the May or June timeframe. Kevin Faley is the Editor of Capitol View and a partner in Venable's Legislative Practice Group. Mr. Faley can be reached at 202-344-4706. __________________________________________________________________________________________ VALUE ADDED, VALUES DRIVEN.SM CAPITOL VIEW MARCH 2005 3 Earmarks One of the growth areas in the Washington government relations practice is Congressional appropriations, specifically obtaining Federal funds for clients by means of what is known as an “earmark.” While the general outline of the legislative process is clear to anyone who has read the classic How Our Laws Are Made (first issued from the office of the Parliamentarian* of the House of Representatives in 1953, with updated editions reprinted many times since), the details of how the process actually works and results in the spending of money are less well known to those who have not actually worked in the Congress. Accordingly, a first-hand familiarity with Congressional procedures for allocating funds and an ability to direct Federal funds to designated recipients are marketable commodities in Washington. What Can Be Funded The short answer is: Just about anything for which the federal government provides funding, which is lots and lots and lots and lots of things. These include – · products or services sold to any department or agency of government (and not just the federal government, because the federal government provides money to governments at the state, local, and tribal level as well); · programs and activities (for example, grants for research, training, education, health and medical, etc.) · construction (this is particularly applicable state and local governments and to nonprofits, and can include buildings, roads, bridges, and so forth) In short, for anyone who wishes to sell something to government, or engages in an activity that is government-funded, an earmark may be a possibility. What is an “Earmark”? In general, the Congressional funding process has two steps. These are authorization (which is enactment of legislation providing legal authority for the Executive Branch departments and agencies, and their programs) and appropriation (which is enactment of legislation providing money to the Executive entities). As a general matter of legislative practice, policy issues are supposed to be determined in authorization bills, while appropriation bills are only intended to allocate money. With respect to the latter, the purest form of appropriation is language stating simply that for a specified agency or program, a certain amount of money is provided. However, one method used by Congress to determine with greater specificity Executive entities’ use of money – and by extension, to more precisely limit the policies funds are used to implement – is to include in the appropriations bill language to limit the purposes for which money may be used. These limitations are commonly known as “earmarks,” though the term has no official status in the legislative process. For example, it is not unusual for a appropriations bill section providing funds to an office (“For the Office of [name of program], $X,000,000.”) to be followed immediately by a limitation on a portion of that money (“Provided further, That of the funds appropriated under this heading that are available for [name of program], $Y00,000 may be used only for [subcategory within that program].”) Within this basic framework can be plugged in the names of the office or program, integers in place of “X” and “Y,” and the right number of zeroes.