Government Affairs

2018 AKFCF GAC Convention Update

The Government Affairs Committee had the pleasure of presenting to the AKFCF at the Townhall hosted on Saturday, February 24th in Anaheim, California.

During the presentation, Peg Duenow and Mary Donohue gave a comprehensive Government Affairs update to franchisees that covered pertinent issues on Capitol Hill.

Tax Reform: Tax reform was a major priority for Republican Leadership in this Congress. When the House tax bill was introduced, the original language was particularly problematic for franchisees registered as pass-through entities. We used KFC franchisee data to construct scenarios for legislators that outlined the effects that the original language could have had on franchise businesses.  When the numbers came back negative, we worked to distribute them to high-ranking Members of Congress. Through these examples, we were able to jump start the conversation about small business and turn the pass-through portion of the tax bill in our favor.

Joint Employer: In the recent months, there has been a flurry of activity surrounding the issue. First, on November 7th the U.S. House of Representatives passed H.R.3441 the Save Local Business Act by a roll call vote of 242-181. The bill would return the definition of a joint employer “direct and immediate control”.

Second, on December 14th, 2017 the NLRB reversed the 2015 decision to redefine the terms of a joint employer and returned to the original definition of “direct and immediate control”. In a 3-2 decision by the board’s conservative majority, they ruled that to be classified as a “joint employer”, jointly liable for labor violations, a business must have a direct and immediate connection to the employees in question.  However, this good news was fleeting.   On February 26th, the NLRB vacated their previous decision from December of 2017 and reverted to the Obama-era definition of a joint employer to “indirect and potential control”.

Overtime: The Final Obama Administration overtime rule was blocked by a preliminary injunction on November 22nd, 2016. A U.S. District Court granted summary judgement to the plaintiffs and declared the Final Rule invalid on August 31, 2017.

The DOL under the Trump Administration issued a Request for Information (RFI) on July 26th, 2017 in support of a new proposed overtime rule. The RFI was answered by businesses and business owners. Their responses included parameters about updating the salary threshold and what the appropriate bases for setting an updated standard should be and what businesses can afford.  The DOL received more than 140,000 comments before the comment period closed on September 15th, 2017. Likely, the DOL will make its position known sometime in 2018 and disclose the updated increase to the overtime threshold.

Renewable Fuel Standard: Under the Trump Administration, we’ve seen a slowing in our efforts to quell the RFS. President Trump was a vocal supporter of the RFS during his campaign, and we’re still attempting to see how he would respond to legislation to quell the program.  We’ve taken the approach amongst our coalitions involved with the RFS to strategically message Members who are undecided on the issue in hopes of gaining more support for the reversal of this program down the road.

Donate to the PAC: Contributing to the AKFCF PAC is the best way to support the election and reelection committees of pro-business Members of Congress who share the same concerns as franchisees. The money raised in the PAC goes directly to Members of Congress.  You may make your 2017 AKFCF PAC donation online by visiting our portal on the AKFCF website. Please click here to contribute.

For more information, please contact your regional GAC representative or Mary Donohue of Polaris Consulting, LLC (mdonohue@polariswdc.com).

News of the week ...

McDonald's Agrees to Settle Significant Labor Case

https://www.qsrmagazine.com/legal/mcdonalds-agrees-settle-significant-labor-case

  • Is McDonald's a joint employer of franchisees? That still isn't quite clear.

LEGAL MARCH 2018 BY DANNY KLEIN

McDonald's workers claim they were fired for fighting for higher wages.

In a case closely monitored by restaurant franchise companies around the country, McDonald’s and the National Labor Relations Board asked an agency judge to approve the settlement of a trial that was set to resume Monday (March 19) after a two-month delay.

According to Reuters, a source said the company agreed to settle the labor board case, intended to determine whether McDonald’s should be held accountable for its franchisees’ alleged labor law violations. While a NLRB judge still must approve it, this ruling would keep McDonald’s from being treated as a “joint employer” of workers at McDonald’s franchises, and, in turn, held liable for the illegal labor actions of franchisees.

The trail comes from claims made by employees of a McDonald’s franchisees who said they were fired for joining a national effort to fight for $15 hourly wages, also known as the “Fight for $15” movement. Democratic Senator Elizabeth Warren joined attorneys for the union-backed Fast Food Workers Organizing Committee Saturday in accusing the board’s general counsel, Peter Robb, of rushing to settle the case in favor of McDonald’s, according to Bloomberg.

In a motion filed Monday by a McDonald’s attorney, the company said: “A settlement that provides full relief on all the substantive unfair labor practice charges at issue in this case, and that avoids years of additional litigation that would otherwise delay whatever relief is ultimately determined, is more than reasonable.”

Some groups have warned that a ruling against McDonald’s in this case could disrupt the franchising industry by showing that franchisors could be sued and thus required to bargain with unions representing franchise workers.

According to Reuters, Robb and McDonald’s presented the settlement to an administrative judge at a hearing in New York City.

The issue stems to 2012, when Fight for $15 filed claims on behalf of McDonald’s workers, saying employees across the country were fired for protesting for a higher wage. The trial began in 2016 and was paused in January so President Donald Trump-appointed Robb could begin pursing a settlement. The issue being whether McDonald’s had enough control over its franchisees to be considered a “joint employer.” This settlement, Bloomberg said, does not include a determination that McDonald’s is a “joint employer” of the workers.

Micah Wissinger, an attorney for the Fast Food Workers Organizing Committee, is expected to object to the settlement.

This adds another chapter to the ongoing “joint employer” saga. On February 26, the NLRB unanimously vacated its December Hy-Brand ruling, meaning restaurant operators around the nation will once again be subject to the 2015 Browning-Ferris test for determining joint employment.

The NLRB did so following an inspector general report that said board member Bill Emanuel should have recused himself from voting in the case. The ruling reverts, at least for now, to the Obama-era precedent stemming from the Hy-Brand Industrial Contractors, Ltd. decision, which dramatically narrowed the situations where the joint employer doctrine could be applied. Read more about the reversal here.

Below are a few highlights of what is included in the omni:
 
BGOV Closer Look: Omnibus Funding Highlights

By Bloomberg Government | March 22, 2018 12:59PM ET | Bloomberg Government

The $1.3 trillion omnibus spending measure would boost funding for defense and domestic programs.

The measure is consistent with the two-year budget caps deal reached in February (Public Law 115-123; see BGOV Bill Summary) which allowed for $80 billion more in defense spending and $63 billion more for nondefense programs. The measure would allocate $78.1 billion for Overseas Contingency Operations (OCO) funding that doesn’t count toward the caps.

The omnibus spending package is being offered as a House amendment to the Senate amendment to H.R. 1625, which the Senate amended and passed by unanimous consent on Feb. 28.

This summary provides highlights of the spending provisions, broken out by appropriation measure. House and Senate leaders have also attached reauthorizations, changes to the 2017 tax overhaul and other legislation.

AGRICULTURE-FDA

The Agriculture Department and Food and Drug Administration would receive $23.3 billion in discretionary funding for fiscal 2018, according to a summary from the House Appropriations Committee.

The measure would provide a total of $146 billion, $7.6 billion less than fiscal 2017, when including mandatory funding for programs such as nutrition assistance and crop insurance.

Agriculture Funding

The measure would fund the following USDA agencies that support agricultural and conservation programs, according to the joint explanatory statement:

Agency (dollars in millions)

Measure

Vs. FY 2017

Vs. request

Farm Service Agency

$1,627.1

+$2.2

+$117.5

Agricultural Marketing Service

$1,613.1

+$88.7

+$69.5

National Institute of Food and Agriculture

$1,407.8

+$44.9

+$155.0

Agricultural Research Service

$1,343.4

+$73.5

+$350.2

Food Safety and Inspection Service

$1,056.8

+$24.8

+$18.8

Natural Resources Conservation Service

$1,034.1

+$7.6

+$268.1

Animal and Plant Health Inspection Service

$985.1

+$35.7

+$172.2

Policy Riders

The measure would continue a prohibition on inspecting horses, which effectively bars horse slaughter for human consumption.

FSIS would be prohibited from finalizing a June 2017 proposal that would allow China to export poultry products to the U.S. unless the agency ensures that the inspection system for Chinese facilities is equivalent to the U.S.

The measure would authorize USDA to create an under secretary of Agriculture for Farm Production and Conservation.

Rural Development

Rural development programs would receive $3 billion, $63.7 million more than fiscal 2017 and $1.02 billion more than requested. That would include $1.99 billion for the Rural Housing Service, a $72.5 million cut from last year, and $661.4 million for the Rural Utilities Service, an $11.7 million cut.

The measure also would authorize $37.6 billion in loans for programs including housing, rural electricity and telecommunications, and water and waste disposal.

Food Assistance

Domestic food programs would receive $104.9 billion, $3.19 billion less than fiscal 2017 and $457.7 million more than requested. That would include mandatory funding for the Supplemental Nutrition Assistance Program (SNAP) and child nutrition programs.

Program (dollars in millions)

Measure

Vs. FY 2017

Vs. request

SNAP

$74,013.5

-$4,467.2

+$401.0

Child nutrition

$24,254.1

+$1,460.2

-$2.1

WIC

$6,175.0

-$175.0

+$25.0

Commodity assistance programs

$322.1

+$7.0

+$28.5

International Aid

International food assistance programs would receive the following:

Program (dollars in millions)

Measure

Vs. FY 2017

Vs. request

Food for Peace grants

$1,600.0

+$134.0

+$1,600.0

McGovern-Dole International Food for Education and Child Nutrition Program

$207.6

+$6.0

+$207.6

FDA Funding

The FDA would receive a total of $5.21 billion under the measure, $483.4 million more than in fiscal 2017. Of that amount, $2.81 billion would be discretionary appropriations and $2.4 billion would come from user fee revenue.

The measure would exempt wine grapes from a 2015 FDA rule on standards for fruits and vegetables.

CFTC Funding

The CFTC would receive $249 million, $1 million less than in fiscal 2017 and the administration’s request. The commission also issued a separate request for $281.5 million.

COMMERCE-JUSTICE-SCIENCE

The Justice Department, Commerce Department, NASA, and the National Science Foundation (NSF) would each receive a funding boost under the fiscal 2018 omnibus spending agreement.

The Commerce-Justice-Science section of the omnibus would provide a net $59.6 billion in discretionary funding after scorekeeping adjustments, $3 billion more than in fiscal 2017, according to the House Appropriations Committee summary on the measure.

Commerce Department

The Commerce Department would receive $11.1 billion under the measure, $1.9 billion more than in fiscal 2017 and $3.32 billion more than requested.

The department’s major offices would be funded as follows:

Program (dollars in millions)

Measure

Vs. FY 2017

Vs. request

National Oceanic and Atmospheric Administration

$5,909.4

+$233.9

+$1,138.7

Patent and Trademark Office

$3,500.0

+$270.0

$0

Census Bureau

$2,814.0

+$1,344.0

+$1,317.0

National Institute of Standards and Technology

$1,198.5

+$246.5

+$473.5

(Note: The Patent and Trademark Office collects fees to offset its entire appropriation.)

Justice Department

The Justice Department would receive $30.3 billion under the measure, $1.35 billion more than in fiscal 2017 and $1.97 billion more than requested.

Major divisions would be funded as follows:

Program (dollars in millions)

Measure

Vs. FY 2017

Vs. request

FBI

$9,400.2

+$393.8

+$625.7

Federal Prison System

$7,278.3

+$136.8

+$77.3

U.S. Marshals Service

$2,900.9

+$187.4

+$97.9

Drug Enforcement Administration

$2,190.3

+$87.4

+26.3

U.S. attorneys

$2,136.8

+$101.8

+$79.5

State and local law enforcement activities

$2,442.3

+$374.5

+$965.0

Bureau of Alcohol, Tobacco, Firearms and Explosives

$1,293.8

+$35.2

+$20.0

The bill wouldn’t bar the department from providing funds to “sanctuary cities” that don’t comply with federal immigration law.

Science Programs

Science programs under the C-J-S section of the measure would receive $28.5 billion, an increase of $1.38 billion from fiscal 2017 and $2.76 billion more than requested.

The funding for major science agencies would be allocated as follows:

Agency (dollars in millions)

Measure

Vs. FY 2017

Vs. request

NASA

$20,736.1

+$1,082.8

+$1,643.9

NSF

$7,767.4

+$295.1

+$1,114.5

DEFENSE

The Pentagon would receive $654.6 billion for fiscal 2018 in the Defense portion of the measure -- $589.5 billion in base funding and $65.2 in OCO funds, according to a summary from the House Appropriations Committee.

The total doesn’t reflect about $5 billion in emergency funding for fiscal 2018 that was provided for missile defense, among other things, earlier this year in Public Law 115-96.

The Defense Department also receives funding under other parts of the measure, including the Military Construction-VA section.

Base Defense Funding

The measure’s base funding allocation would be divided as follows:

Account (Dollars in millions)

Bill

Vs. FY 2017

Vs. Request

Operation and maintenance

$188,245.6

+$20,642.3

-$324.7

Procurement

$133,868.6

+$25,441.8

+$19,936.8

Military personnel

$133,367.4

+$4,641.4

-$514.2

Research, development, test, and evaluation

$88,308.1

+16,006.5

+$5,616.5

Defense Health Program

$34,428.2

+$646.9

+$763.7

Procurement Highlights

The following amounts would be provided as base funding for various procurement activities across the services and DOD.

Service (dollars in millions)

Bill

Vs. FY 2017

Vs. Request

Army

$23,971.4

7,989.7

+$6,530.3

Navy & Marine Corps

$57,980.8

+$9,173.2

+$8,440.8

Air Force

$46,419.7

+$7,727.3

+$4,341.8

Defensewide

$5,429.3

+$548.2

+$593.9

The procurement funding would support the following weapon system purchases, according to the committee summary:

  • $23.8 billion for 14 Navy ships, including three littoral combat ships produced in variants by Lockheed Martin Corp. and Austal Ltd., two Virginia-class submarines built by General Dynamics Corp.’s Electric Boat Corp. and Huntington Ingalls Industries Inc.’s Newport News Shipbuilding Inc., and one carrier replacement.
  • $10.2 billion for 90 Lockheed Martin F-35 Joint Strike Fighters.
  • $2.9 billion for 18 Boeing Co. KC-46 tanker aircraft.
  • $1.8 billion for 24 Boeing F/A-18 Super Hornets.
  • $1.7 billion for Boeing Poseidon Aircraft.
  • $1.6 billion for 30 new and 50 remanufactured Boeing Apache helicopters.
  • $1.4 billion for the Evolved Expendable Launch Vehicle
  • $1.1 billion for 56 Black Hawk helicopters built by Lockheed subsidiary Sikorksy Aircraft Corp.
  • $1.1 billion for Abrams tank upgrades.

Other Defense Provisions

Defense Health Program funding would include $15 billion for private-sector care and $9.3 billion for in-house care. The measure would limit transfers for contractor-provided care by requiring prior approval for any transfers of in-house care funds. Any transfer in excess of $15 million would require approval by the secretary, according to the explanatory statement.

The measure would allow the Pentagon to spend as much as 25 percent of fiscal 2018 O&M funds in the last two months of the fiscal year, rather than the 20 percent allowed under current law, Bloomberg Government’s Roxana Tiron reported.

The measure would bar the use of funds to:

  • Close the naval detention center at Guantanamo Bay, Cuba, or transfer or release detainees.
  • Conduct business with the Russian state corporation Rosoboronexport OJSC. The Defense secretary could waive the prohibition if it’s in national security interests.
  • Demilitarize M-1 carbines, rifles, and certain pistols that aren’t prohibited for commercial sale under federal law.
  • Terminate senior Reserve Officers’ Training Corps (ROTC) programs.
  • Carry out another round of base realignment and closure activities.

ENERGY & WATER DEVELOPMENT

The Energy Department, water programs of the Army Corps of Engineers and the Bureau of Reclamation, and related agencies would receive $43.2 billion for fiscal 2018.

The measure would provide $4.77 billion more than fiscal 2017 and $9.03 billion more than the administration requested, according to the joint explanatory statement.

The bill doesn’t include provisions from the administration request and the House-passed Energy and Water appropriations bill to support development of the Yucca Mountain nuclear storage facility in Nevada.

Energy Department

The Energy Department would receive a total of $34.5 billion under the bill, $3.77 billion more than fiscal 2017 and $6.65 billion more than requested.

The following table summarizes the major allocations of funding:

Agency (dollars in millions)

Bill

Vs. FY 2017

Vs. request

National Nuclear Security Administration

$14,669.0

+$1,730.7

+$738.0

Energy programs

$12,918.0

+$1,634.4

+$5,407.2

Environmental and other defense activities

$6,828.0

+$76.0

+$445.4

Power Marketing Administrations

$105.0

-$1.87

$0.0

Energy Defense Activities

The measure would provide $10.6 billion for weapons activities, $2 billion for defense nuclear nonproliferation, and $1.62 billion for naval nuclear reactors. It would provide funds for the Columbia-class Ballistic Missile Submarine and for infrastructure needed to defuel the Navy’s aircraft carriers, according to the House Appropriations Committee summary of the bill.

Defense nuclear nonproliferation funds couldn’t be used to contract with or provide assistance to Russia, unless the Energy Department requested a waiver for national security purposes.

Funding provided for the National Nuclear Security Administration (NNSA) and cleanup activities is subject to the defense spending cap.

Energy Nondefense Activities

Funding for major nondefense Energy Department programs would include:

  • $6.26 billion for science.
  • $2.32 billion for Energy Efficiency and Renewable Energy.
  • $1.07 billion for non-defense nuclear energy research.
  • $840 million for the Uranium Enrichment Decontamination and Decommissioning Fund.
  • $726.8 million for Fossil Energy Research and Development.
  • $353.3 million for Advanced Research Projects Agency-Energy (ARPA-E). The administration proposed eliminating the program.

Strategic Petroleum Reserve

The measure would authorize the Energy Department to draw down and sell as much as $350 million of crude oil from the Strategic Petroleum Reserve.

FERC Funding

The bill would allow the Federal Energy Regulatory Commission to use $367.6 million in collected fees for fiscal 2018, $20.8 million more than in fiscal 2017.

Army Corps of Engineers

The measure would provide $6.83 billion to the Army Corps of Engineers, $789.2 million more than in fiscal 2017 and $1.83 billion more than requested.

The appropriation would include $3.63 billion for operation and maintenance, and $2.09 billion for construction.

The measure would restrict application of the Clean Water Act in certain agricultural areas, according to the committee summary.

Interior Department

The Energy and Water Development portion of the bill would provide $1.48 billion for the Interior Department, $163 million more than fiscal 2017 and $373.6 million more than requested.

Nearly all of that funding -- $1.47 billion -- would go to the Bureau of Reclamation, which is responsible for maintaining federal water and hydropower projects in the West.

The Bureau of Reclamation’s drought assistance program would be extended through fiscal 2020 and its authorization would be increased to $120 million, from $90 million, for the duration of the program.

FINANCIAL SERVICES-GENERAL GOVERNMENT

Agencies funded by the Financial Services-General Government section of the omnibus would receive a net $23.4 billion in discretionary funding, $1.91 billion more than in fiscal 2017 and $725.4 million more than requested. The agreement would also provide $21.8 billion in mandatory funding.

Net discretionary and mandatory funding for major agencies and programs would be allocated as follows:

Agency (dollars in millions)

Measure

Vs. FY 2017

Vs. request

Internal Revenue Service (IRS)

$11,430.6

+$195.6

+$455.6

Judiciary offices

$7,552.7

+$193.7

-$117.2

Small Business Administration

$700.8

-$185.9

-$128.3

Treasury Department, non-IRS

$727.4

+$366.9

+$479.4

District of Columbia (federal funds)

$721.4

-$34.9

+$17.3

Executive Office of the President

$725.5

+$16.6

+$37.2

Election Assistance Commission

$390.1

+$380.5

+$380.9

National Archives and Records Administration

$378.2

+$2.3

+$27.2

Office of Personnel Management

$290.8

+$1.6

-$19.0

U.S. Postal Service

$303.1

+$14.9

+$10.4

The measure would also set the following spending levels for agencies that are authorized to collect fees to offset their entire appropriation:

Agency (dollars in millions)

Measure

Vs. FY 2017

Vs. request

Securities and Exchange Commission

$1,896.5

+$291.5

+$50.0

Federal Communications Commission

$322.1

-$34.7

$0.0

The agreement would:

  • Provide $320 million for the IRS to implement the 2017 tax overhaul (Public Law 115-97).
  • Provide $380 million for Election Assistance Commission grants to help states improve and secure their election systems.
  • Appropriate $600 million in fiscal 2018 and $400 million in fiscal 2019 to reimburse television and radio broadcasters that relocated to new channels following a spectrum auction.
  • Allow business development companies to increase their leverage.
  • Remove a 10-year minimum on identity protection services that the Office of Personnel Management is required to provide individuals affected by a data breach.

HOMELAND SECURITY

The Homeland Security Department would receive a net $47.7 billion in discretionary funds subject to spending caps, $5.32 billion more than in fiscal 2017 and $3.72 billion more than requested.

Additional discretionary funds that wouldn’t count toward the spending caps would include $7.37 billion in disaster relief spending for the Disaster Relief Fund and $163 million in OCO funding for the Coast Guard.

Net discretionary and mandatory funding for major DHS agencies and programs would be allocated as follows:

Agency (dollars in millions)

Measure

Vs. FY 2017

Vs. request

Customs and Border Protection

$14,017.5

+$1,830.6

+$110.5

Federal Emergency Management Agency

$12,309.0

+$913.5

+$1,789.5

Coast Guard

$12,107.7

+$1,653.2

+$1,666.5

Immigration and Customs Enforcement (ICE)

$7,075.9

+$640.6

-$489.6

Transportation Security Administration

$4,925.4

-$260.8

+$803.7

Secret Service

$2,006.5

-$39.1

+$62.9

The measure would:

  • Appropriate $1.57 billion for border security infrastructure and technology, including fencing. It wouldn’t provide additional funding for concrete border wall prototypes sought by President Donald Trump.
  • Support 40,520 ICE detention beds, according to a summary from the House Appropriations Committee. That would be 1,196 more beds than in fiscal 2017, though fewer than the president requested.

INTERIOR-ENVIRONMENT

The measure would provide a total of $36.6 billion, $9.33 billion more than requested and $3.96 billion more than what was appropriated for fiscal 2017, according to the explanatory statement on the measure. That includes $1.28 billion, mostly for disaster funding, provided under the February spending caps deal.

Environmental Protection Agency

The Environmental Protection Agency would receive $8.06 billion in fiscal 2018, equal to the fiscal 2017 amount and $2.4 billion more than the administration requested.

Major programs would be funded as follows:

Program (dollars in millions)

Measure

Vs. FY 2017

Vs. request

State and Tribal Assistance Grants (STAG)

$3,562.2

+$35.0

+$628.7

Environmental programs and management

$2,598.0

$0.0

+$880.5

Hazardous Substance Superfund

$1,091.9

+3.2

+329.9

Science and technology

$706.5

$0.0

+$255.7

The measure would require that the EPA, along with the Energy and Agriculture departments, ensure that federal policy treats emissions from burning woody biomass as carbon neutral.

The measure would bar the EPA from regulating lead ammunition or fishing tackle under the Toxic Substances Control Act.

Interior Department

The Interior Department would receive discretionary appropriations totaling $13.1 billion, $2.5 billion more than requested and $863.3 million less than in fiscal 2017.

Major agencies would be funded as follows:

Agency (dollars in millions)

Measure

Vs. FY 2017

Vs. request

National Park Service

$3,202.2

+$270.2

+$648.7

Bureaus of Indian Affairs and Education

$3,063.6

+$203.9

+$575.6

U.S. Fish and Wildlife Service

$1,594.6

+$74.9

+$292.0

Bureau of Land Management

$1,297.9

+$79.5

+$258.4

U.S. Geological Survey

$1,148.5

+$63.3

+$226.3

(Note: BLM amounts exclude mandatory funding.)

Forest Service

The Forest Service, which is part of the Agriculture Department, would receive $5.93 billion, $338.4 million more than fiscal 2017 and $1.22 billion more than requested.

LABOR-HHS-EDUCATION

The agreement would provide $177.1 billion in discretionary appropriations for health, education, and labor agencies, which would be $16 billion more than fiscal 2017, according to a summary of the measure from the House Appropriations Committee. That would include:

  • $78 billion for the Health and Human Services Department (HHS), $10 billion more than last year.
  • $70.9 billion for the Education Department, $2.6 billion more than last year.

$12.2 billion for the Labor Department, $129 million more than last year.

The measure also includes $817.5 billion in mandatory funding for those agencies, which would be $56.9 billion more than in fiscal 2017, according to the joint explanatory statement on the measure.

Health and Human Services Department

Total funding for agencies within HHS, taking into account mandatory and discretionary amounts, would include the following:

Agency (dollars in millions)

Measure

Vs. FY 2017

Vs. request

Centers for Medicare and Medicaid Services

$747,558.2

+$56,752.3

+$75.7

Administration for Children and Families

$38,218.6

+$4,243.9

+$10,071.5

National Institutes of Health (NIH)

$37,084.0

+$3,000.0

+$10,480.4

Centers for Disease Control and Prevention (CDC)

$8,301.2

+$1,046.0

+$2,270.6

Health Resources and Services Administration

$7,014.0

+$552.9

+$1,197.9

Substance Abuse and Mental Health Services Administration (SAMHSA)

$5,159.0

+$1,394.0

+$1,768.2

Administration for Community Living

$2,171.9

+$178.1

+$320.5

Opioid Funding

Several agencies within HHS would receive funding for opioid treatment, prevention, and research, including:

  • A new $1 billion State Opioid Response grant under SAMHSA.
  • $500 million for research on addiction at NIH, and grant recipients would be subject to a 50 percent match. The explanatory statement would also encourage the National Institute on Drug Abuse to allocate more of its budget to opioid research.
  • $500 million for the State Response to the Opioid Abuse Crisis Account created under the 21st Century Cures Act (Public Law 114-255), the same as fiscal 2017.
  • $475.6 million for prescription drug overdose prevention activities at the CDC, $350 million more than fiscal 2017.
  • $130 million for a new Rural Communities Opioids Response program.

Abortion Prohibitions

The measure would continue the Hyde Amendment, which bars the use of federal funds to pay for abortion services, with exceptions for rape or incest or when the mother’s life is endangered.

It also would continue the Weldon Amendment, which prohibits federal agencies from discriminating against providers that don’t perform abortions.

Gun Research

The measure would continue to prohibit the CDC from advocating for gun control measures, a provision known as the Dickey Amendment.

The joint explanatory statement notes that the HHS secretary stated the agency has the authority to research the causes of gun violence. Public health officials have said the provision effectively prevents research in the area.

Education Department

The measure would provide the following amounts, including mandatory funding and advance appropriations, within the Education Department:

Account (dollars in millions)

Measure

Vs. FY 2017

Vs. request

Student financial assistance

$24,445.4

+$247.1

+$1,512.7

Education for the disadvantaged

$16,443.8

+$300.0

+$96.2

Special education

$13,366.2

+$301.8

+$424.1

School improvement programs

$5,158.5

+$749.9

+$4,461.2

Rehabilitation services

$3,587.1

+$51.5

+$24.1

Higher education

$2,246.6

+$191.1

+$701.2

Career, technical, and adult education

$1,830.7

+$110.0

+$354.2

Student Aid Administration

$1,678.9

+$102.1

-$18.8

Impact Aid

$1,414.1

+$85.5

+$177.7

The measure would increase the maximum Pell Grant award by $175, for a total of $6,095.

The measure would provide $350 million to cancel loans under the Public Service Loan Forgiveness Program.

The measure also would provide $1.1 billion for the Student Support and Academic Enrichment Program, which received $400 million in fiscal 2017.

Labor Department

Agencies within the Labor Department would receive the following:

Agency (dollars in millions)

Measure

Vs. FY 2017

Vs. request

Employment and Training Administration

$10,018.2

+$44.0

+$2,358.6

Workers’ compensation programs

$883.3

+$35.5

+$3.7

Bureau of Labor Statistics

$612.0

+$3.0

+$4.2

Occupational Safety and Health Administration

$552.8

$0.0

+$9.5

Pension Benefit Guaranty Corporation

$424.4

-$95.1

-$98.5

Mine Safety and Health Administration

$373.8

$0.0

-$1.4

Veterans employment and training

$295.0

+$16.0

+$15.4

The measure would authorize the Labor secretary to hire security details for protection, including for his or her family and other senior officers.

LEGISLATIVE BRANCH

The House, Senate and congressional agencies would receive $4.7 billion under the legislative branch portion of the package, $260 million more than in fiscal 2017.

Automatic cost-of-living increases for members of Congress would be blocked for another year, while the Library of Congress would have to create a website to allow the public to access nonconfidential Congressional Research Service reports.

MILITARY CONSTRUCTION-VA

The Military Construction-Veterans Affairs section of the omnibus would provide a net $92 billion in discretionary funding subject to spending caps, $9.62 billion more than in fiscal 2017 and $3.21 billion more than requested. Base funding for Defense Department construction would fall under the defense spending cap.

It would also provide a net $103.9 billion in mandatory funding and $750 million in OCO funding.

The agreement would include the following advance discretionary and mandatory appropriations for the VA in fiscal 2019:

Agency (dollars in millions)

Measure

Vs. FY 2017

Vs. request

Veterans Benefits Administration

$107,709.7

+$3,773.7

$0.0

Veterans Health Administration

$70,699.3

+$4,314.3

$0.0

Net mandatory and discretionary funding for major programs in fiscal 2018 would be allocated as follows:

Program (dollars in millions)

Measure

Vs. FY 2017

Vs. request

Base military construction

$10,091.0

+$2,365.0

+$308.5

VA information technology systems

$4,055.5

-$222.8

$0.0

OCO military construction

$750.0

+$330.3

+$111.9

VA major construction projects

$512.4

-$15.7

$0.0

VA minor construction projects

$342.6

-$29.5

$0.0

National Cemetery Administration

$306.2

+$20.0

$0.0

The agreement would also:

  • Provide an additional $2 billion for VA infrastructure improvements.
  • Provide $782 million for the VA to develop a new electronic health record system.
  • Prohibit the closure of the detainee prison at Guantanamo

Bay Naval Station in Cuba and provide $115 million in OCO funds for barracks at the station.

STATE & FOREIGN OPERATIONS

The State Department and foreign operations programs would receive $54.2 billion for fiscal 2018, $13.5 billion more than the administration requested and $3.35 billion less than the programs received in fiscal 2017.

About 22 percent of the total, or $12 billion, would be OCO funding that doesn’t count against the discretionary spending caps. 

The measure would reject the administration’s request to cut the international affairs budget by 30 percent compared with the fiscal 2017 enacted level.

Major programs would receive base funding as follows:

Program (dollars in millions)

Bill

Vs. FY 2017 

Vs. request

Global health programs

$8,690.0

-$35.0

+$2,209.5

Security assistance

$7,601.5

+$1,180.0

+$1,700.0

Diplomatic & consular

$5,744.4

-$402.8

+$460.7

Development assistance

$3,000.0

+$4.5

+3,000.0

Embassy security

$2,242.7

+$1,124.8

+$1,100.5

International organizations

$1,785.8

-$30.1

+$616.7

The measure would block all global health assistance funds -- not just those earmarked for family planning -- from going to nongovernmental organizations that promote or perform abortions, except in cases of rape or incest, or when the mother’s life is endangered. The provisions would support the administration’s expansion of the Mexico City policy -- or “global gag rule” to opponents -- that has typically been in effect under Republican administrations.

The measure also would allow contributions to the U.N. Population Fund, which supports reproductive health care and other rights for women and youth, only if the fund doesn’t support abortions and U.S. support isn’t used for programs in China.

The agreement would reverse rules blocking the financing of coal-fired power plants by the Overseas Private Investment Corporation, U.S. Export-Import Bank, and World Bank.

TRANSPORTATION HOUSING AND URBAN DEVELOPMENT

The Transportation Department, Housing and Urban Development Department (HUD), and related agencies would receive $76 billion for fiscal 2018. The measure would provide $12.6 billion more than in fiscal 2017 and $23 billion more than the administration requested.

The tables below don’t reflect the $29.8 billion in emergency appropriations for transportation and housing programs in Public Law 115-123. The bulk of those funds -- $28 billion -- went to HUD’s Community Development Fund.

Transportation Department

The agreement would provide $86.2 billion in budgetary resources for the Transportation Department, including a net discretionary appropriation of $27.3 billion. Total resources would be $9.97 billion more than in fiscal 2017 and $11.1 billion more than requested.

The major divisions of the department would be funded as follows, with breakdowns of the discretionary and trust fund amounts:

Program (dollars in millions)

Discretionary

Trust Fund

Total

Federal Highway Admin. (FHWA)

$2,525.0

$44,234.2

$47,498.2

Federal Aviation Admin. (FAA)

$14,650.7

$3,350.0

$18,000.7

Federal Transit Admin. (FTA)

$3,747.1

$9,733.3

$13,480.5

Federal Railroad Admin. (FRA)

$3,091.4

$0.0

$3,091.4

TIGER grants

$1,500.0

$0.0

$1,500.0

Maritime Admin. (MARAD)

$979.6

$0.0

$979.6

National Highway Traffic Safety Admin. (NHTSA)

$200.6

$746.6

$947.2

Federal Motor Carrier Safety Admin. (FMCSA)

$0.0

$844.8

$844.8

The measure would triple Transportation Investment Generating Economic Recovery (TIGER) grants for surface transportation, which the administration proposed eliminating. At least 30 percent of TIGER grants would have to be used in rural areas. The administration couldn’t use a project’s proposed federal share as a criterion when awarding grants.

The following table compares the total budgetary resources in the fiscal 2018 appropriations legislation with what was provided in the fiscal 2017 omnibus and what the administration requested:

Program (dollars in millions)

Measure

Vs. FY 2017

Vs. request

FHWA

$47,498.2

+$4,350.1

+$2,525.0

FAA

$18,000.7

+$1,593.3

+$1,874.8

FTA

$13,480.5

+$1,066.0

+$2,254.6

FRA

$3,091.4

+$1,240.0

+$1,942.4

TIGER grants

$1,500.0

+$1,000.0

+$1,500.0

MARAD

$979.6

+$457.1

+$588.8

NHTSA

$947.2

+$35.9

+$48.1

FMCSA

$844.8

+$200.6

+$187.0

Gateway Project

The measure wouldn’t set funds aside for the Gateway tunnel project between New York and New Jersey. President Donald Trump and Transportation Secretary Elaine Chao oppose the funding arrangement that the states proposed to the Barack Obama administration. The project could still access at least $541 million in funding that doesn’t require Transportation Department approval, Bloomberg Government’s Shaun Courtney reported.

Housing and Urban Development

HUD would receive a net appropriation of $42.7 billion under the measure, $3.86 billion more than in fiscal 2017 and $11.3 billion more than requested.

The major divisions of the department would be funded as follows:

Program (dollars in millions)

Measure

Vs. FY 2017

Vs. request

Public and Indian Housing

$30,298.0

+$2,788.8

+$5,777.1

Housing programs

$12,491.6

+$952.0

+$1,048.2

Community Planning and Development

$7,669.0

+$866.0

+$5,089.0

The agreement would increase funding for Community Development Block Grants by $300 million. The fiscal 2018 budget request proposed eliminating the program.

It would extend HUD’s Mark-to-Market program through Oct. 1, 2022. The program, which preserves low income rental housing, expired on Oct. 1, 2017.

To contact the analysts:
Adam M. Taylor in Washington at ataylor239@bloomberg.net;
Michael Smallberg in Washington at msmallberg@bloomberg.net;
Sarah Babbage in Washington at sbabbage2@bloomberg.net;
Danielle Parnass in Washington at dparnass@bloomberg.net

To contact the editors responsible:
Adam Schank at aschank1@bloomberg.net;
Loren Duggan at lduggan1@bloomberg.net

 


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