Legislative Updates

Keeping you apprised of policy action from The Presidential Administration and U.S. Congress.

July/August 2011
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» Announcements and Grants

  • The White House has launched a website for African Americans with up-to-date information where visitors can sign up to receive alerts. Click here.
  • On July 26th, NBCSL hosted a webinar with the Nuclear Energy Institute (NEI), a public policy organization representing nuclear technology companies, to hear about the industry's response to safety concerns in the wake of the Fukushima Daiichi Nuclear Power Plant. Click here to access the PowerPoint presentation slides. For questions about the presentation, please call Marshall Cohen, NEI's Senior Director of State and Local Government Affairs at (202) 739-8000.
  • On July 28th, the Department of Housing and Urban Development (HUD) announced the availability of grant monies to support sustainable local initiatives through the FY2011 Community Challenge Planning Grant Programs from HUD's Office of Sustainable Housing and Communities. Awarded competitively, the program works to expand housing choices, improve connections between employment centers and homes, and reduce barriers to achieving affordable, economically vital, and sustainable communities. Applications are due September 9th. For the full announcement and to apply, click here.
  • The Assistance to Firefighters Grants program runs until September 9th. Funds are available to fire departments for fire operations and firefighter safety, which includes training, equipment, wellness and fitness, vehicles, and modifications to fire stations and facilities. A total of $380.7 million is available for both career and volunteer departments. Click here for more info. For questions go to the AFG Program Help Desk at (866) 274-0960 or This e-mail address is being protected from spambots. You need JavaScript enabled to view it .

Appropriations

So far, the House has voted out the following appropriation bills: Agriculture, Defense, Energy & Water, Homeland Security, Legislative Branch, and Military/Veterans Affairs. The Senate has only acted on the Military/Veterans Affairs bill, sending the legislation to Conference. All of the appropriations bills reported out of the House chamber have endured significant cuts with more to come in the pending, discretionary-heavy funding bills not yet considered. Of the bills passed by the House thus far, Agriculture and Energy & Water budget cuts have the largest fiscal impact on NBCSL member states. Here is a quick tally of the critical cuts made in both bills:

AGRICULTURE = $3 billion cut overall as compared to FY2011 funding

  • The Women, Infant, and children program (WIC) was cut by $652 million from the FY2011 amount;
  • The Emergency Food Assistance Program (TEFP) mandatory commodity funding was capped at $200 million, a $51 million cut from FY2011;
  • The bill cuts the TEFP storage and distribution fund by $12 million from FY2011 levels;
  • The McGovern/Dole International Food for Education and Child Nutrition Program (a program that greatly benefits African children) was cut by 10% below FY2011 funding; and
  • The $4.6 billion enacted in November of 2010 to compensate black farmers for USDA discrimination was not impacted by this bill.

ENERGY & WATER = $1 billion cut overall as compared to FY2011 funding

  • Cuts $89 million from Corps of Engineer Projects compared to FY2011;
  • Cuts $97 million from solar energy programs compared to FY2011;
  • Cuts $46 million from Fuel Efficient Vehicle Technology Program compared to FY2011;
  • Cuts $61 million from the FY2011 levels of the Building Technologies Program;
  • Cuts $33 million from the Biomass & Bio-Refinery Research & Dev. Program compared to FY2011; and
  • Cuts $141 million from the FY2011 levels of the Weatherization Assistance Program

The Debt Limit Deal Impacts States

The agreement reached by Congress to raise the debt ceiling has significant implications for Sates as $2.4 trillion must be removed from Federal spending by FY2021. Without additional revenues or tax increases to help meet this target, Congress will have to cut an average of $240 billion per year. Broadly, these cuts come in two fashions. First, a joint Congressional Committee may make recommendations for cuts totaling $1.2 trillion by November 23, 2011. If those recommendations are not passed, then automatic cuts to Federal spending across the board will take effect, achieving the desired decreases by FY2021 through spreading reductions evenly among nine budget cycles.

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» Labor, Military and Veterans' Affairs

President Obama to Unveil the Administration's Jobs Package in September

Aides close to the President are reporting that after Labor Day, the President will unveil his plan to put Americans back to work and say the package is likely to target the long-term unemployed, some 6.2 million Americans who have been out of work for six months or more. White House sources indicate the President is "particularly interested" in pursuing an existing workforce program in the State of Georgia---"Georgia Works"--as a model. "Georgia Works" is operated by the Georgia Department of Labor allowing jobless workers receiving unemployment insurance to train for jobs at participating businesses, at no cost to the employer. The trainees also receive a small stipend to cover transportation and other expenses. After eight weeks of training, the company may hire the person, but is not required to do so. Speaking at a town-hall meeting last week in Atkinson, IL, President Obama called it a "smart program." The President added, "You're essentially earning a salary and getting your foot in the door into that company." The concept resembles welfare-to-work programs of the 1990s, in which welfare recipients were encouraged and, in some cases, required to work in exchange for benefits.

Congressional Black Caucus Launches "For the People" Jobs Initiative

Following the Department of Labor's July employment figures reporting that 16.2% of African Americans are unemployed, members of the Congressional Black Caucus (CBC) unanimously introduced the Congressional Black Caucus 'For the People' Jobs Initiative Resolution (H. Res. 348) to encourage the House of Representatives to immediately consider and pass critical jobs legislation to address the growing jobs crisis throughout America. To address the unemployment crisis and the need for job creation solutions in underserved communities, the CBC partnered with the private and public sectors seeking remedies to the crisis. The partnership's goal is to connect job seekers with potential employers by going into communities with legitimate, immediate employment opportunities for the underserved.

In mid-August, the CBC kicked off its initiative in Chicago, IL. The CBC's For the People Jobs Initiative has begun hosting job fairs in some of the country's most economically distressed cities, including Atlanta, Cleveland, Detroit, Los Angeles, and Miami. Members of the CBC have been in attendance in efforts to demonstrate their commitment to getting members of the community back to work. Offering more than traditional job fairs, each two-day stop incorporates a town hall meeting in which job seekers can offer feedback and describe their employment challenges.

Since the beginning of the 112th session of Congress, members of the CBC have introduced over 40 pieces of legislation focusing on job creation. The CBC plans to continue introducing legislation based on the strong showing of support from leaders and concerned unemployed persons within the community. CBC Chairman Emanuel Cleaver said at the tour's end, the Caucus will commission a newly created CBC jobs advisory council of top black economic and business experts to draft a report. The report will detail the outcomes of each event and propose a long-term solution for job creation and economic growth.

Percentage of African Americans Remain Most Unemployed Among Nation

The United States Department of Labor released the July 2011 Employment Situation Report showing a total number of 13.9 million Americans are unemployed, representing 9.1% of the population. While there have been marginal decreases over the past months, the fact is many Americans are still struggling to secure jobs. States across the nation have enacted job training programs and provided workforce services to connect job seekers with potential employers. From an historical perspective, mixed signals from economic indicators during recovery are common. Fluctuations in rates of unemployment and job growth are typical examples of starts and stops while the economy rebounds and unemployed workers who may have given up looking for work rejoin the workforce. The puzzling question for economists and labor officials is the disparity of unemployment figures between whites and people of color. According to the July 2011 data from the Bureau of Labor Statistics, the unemployment rate amongst white Americans continues to be significantly lower (8.1%) compared to African Americans (15.9%) and Latinos (11.3%). The onus remains on Congress and the White House to address the problem with a well-crafted jobs and economic development bill. The White House has reported President Obama will unveil the Administration's plan for putting Americans back to work on Labor Day. For more information on the July 2011 Employment Situation, click here.

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» Emergency Preparedness and Homeland Security

WMD Prevention and Preparedness Act of 2011

In late June, Rep. Bill Pascrell, Jr. (D-NJ) and Rep. Peter T. King (R-NY), Chairman of the House Committee on Homeland Security, reintroduced the Weapons of Mass Destruction Prevention and Preparedness Act of 2011, a bipartisan bill that would continue implementing recommendations from the Weapons of Mass Destruction Commission. The act would be used to enhance homeland security and take measures to "protect, respond, and recover from a WMD attack in the US."

The proposed legislation is a follow-up to a report by the WMD Commission which came out in December 2008, headed by former U.S. Senators Bob Graham (D-FL) and Jim Talent (R-MO). The commission was created to evaluate the "nation's current activities and capabilities to prevent WMD proliferation and terrorism," and to provide "recommendations for addressing these threats in the future." A subsequent report card was issued a year after the report's debut. The two former senators sought to review the administration's progress in implementing the recommendations from the report, as well as assess areas of improvement.

The WMD Commission's report card gave the government gave a failing grade "on its efforts to enhance the nation's capabilities for rapid response to prevent biological attacks from inflicting mass casualties," and for not reforming congressional oversight " to better address intelligence, homeland security, and crosscutting 21st-century national security missions." Given these claims around gaps in prevention and preparedness efforts, the WMD bill seeks to develop a bio-defense plan, while requiring the President to "appoint a member of the National Security Staff to serve as the Special Assistant to the President for Bio-defense."

Senators Joseph Lieberman (I-CT) and Susan Collins (R-ME) have advocated for a similar WMD defense bill in the Senate, which is expected to be introduced shortly.

In a Committee on Homeland Security congressional hearing, Senator Talent testified, "Given the ubiquity of select agents readily found in nature and the rapid advances in bio-technology that allow non-state actors the capability to produce sophisticated bio-weapons, a major part of our bio-defense strategy must be based on building a level of preparedness that will effectively remove bio-weapons from the category of WMD. An attack would still cause casualties, but it would not be of a magnitude that would change the course of history." The legislation aims to provide a comprehensive framework on securing the nation's borders against WMD threats by looking at prevention, deterrence, preparedness, response and recovery.

Limit Enforcement of Federal Immigration Laws

The Department of Homeland Security announced last week it will halt deportation proceedings against illegal immigrants who meet certain criteria, including school attendance, military service, or primary responsibility for the care of family members.

Although President Obama indicated he was unable to have "broad categorical authority" to halt deportations, Homeland Security Secretary Janet Napolitano said she does have "discretion" to focus on specific priorities. This would mean that her department along with the Justice Department will review about 300,000 ongoing cases to determine who meets the new criteria.

The announcement received strong support and praise from Hispanic activists and congressional Democrats who have long lobbied the administration to issue such a directive. Rep. Luis V. Gutierrez (D-IL) praised the change, saying, " It is not in our national interest to send away young people who were raised in the U.S. and have been educated here and want only to contribute to this country's success." The focus of this policy would be on enforcing deportation proceedings for criminal offenders and those who are considered national security threats. It is aimed at helping those who were brought to the United States as undocumented children and want to attend college or join the military. This population has been the target of the DREAM Act, a proposal that offered a path to legal residency for undocumented immigrants who grew up in the U.S.

"This case-by-case approach will enhance public safety," said Napolitano. "Immigration judges will be able to more swiftly adjudicate high priority cases, such as those involving convicted felons." Secretary Napolitano assured that a working group would be put into place to provide a framework for "guidance on how to provide for appropriate discretionary consideration" for "compelling cases" in those instances where someone had already been ordered deported. Congressional Republicans have expressed opposition to the change. In a press release, Reps. Peter King (R-NY) and Candice Miller (R-MI) complained the "new non-enforcement policy" is "a blatant attempt to grant amnesty to potentially millions of illegal aliens in this country, and is totally unacceptable."

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» Education

Education Funding Flexibility Clears House Committee

The State and Local Funding Flexibility Act, which passed the House Education and Workforce Committee in early July, grants state education agencies and district-level officials greater flexibility to allocate funding away from programs under Title I to use for other programs and activities they believe will do the most to improve student achievement.

Rep. John Kline (R-MN), chairman of the committee and the bill's chief sponsor, says states should have more freedom to distribute money to programs and activities where they see fit. "Time and time again, school officials have talked about the innovative reforms they would undertake if only they had the flexibility to target federal funds according to their priorities," Kline said in a press release last month. The move is part of a larger push to reduce the federal government's role in public education. Other proponents of the bill, including the American Association of School Administrators (AASA) and the National School Boards Association (NSBA), have written letters in support of the legislation. "In order to ensure substantial academic progress," explains Michael A. Resnick of the NSBA, "local school boards must have the necessary flexibility to use federal funds to strategically meet local needs." The AASA's Bruce Hunter adds, "The carryover of all program reporting requirements is a prudent check on the proposed expansion of flexibility, providing a transparent mechanism for giving local educators the flexibility they need while allowing for state and federal oversight of expenditures and activities."

Opponents insist the change would give officials too much leeway and weaken education resources for students from at-risk demographics, including minority students and those from lower economic strata. Rep. George Miller (D-CA), ranking member on the committee, has said the "shortsighted proposal would allow chief state school officers and school district superintendents to siphon away money intended for poor and minority students" and characterized the measure as a "direct attack on civil rights." Other opponents of the measure, including Education Trust, which works on behalf of low-income and minority students, complains the bill will undo a key federal role in public education, which is to ensure "long-overlooked populations get their fair share of resources and attention." The National Education Association has warned that "this misguided 'flexibility' would undermine the spirit and intent of the original Elementary and Secondary Education Act (ESEA) by narrowing protections for the very students it was designed to protect." In an interview with National Public Radio, Secretary of Education Arne Duncan also expressed the opposition to legislation. The Obama administration is looking for a more bipartisan bill passed before the start of the school year.

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» Health and Human Services

On August 19th, the U.S. Department of Health and Human Services (HHS) released the "50 States/50 Stories" site which relays instances of how the Healthcare Act is making a positive difference in each state. NBCSL members can look at what is posted for their state by clicking here. The link does take a moment to load.

On August 15th, the Centers for Disease Control (CDC) awarded more than $49 million in grants for State and local healthcare operations. To see if your state is a grantee, click here.

Proposed Regulations Issued to the Patient Protection and Affordable Care Act

On August 12, 2011, the Departments of Health and Human Services (HHS) and Treasury issued three proposed rules under the Patient Protection and Affordable Care Act (PPACA) regarding the use of state-run insurance exchanges to purchase private health insurance, beginning in 2014, and subsidies to help qualifying small businesses, individuals, and families purchase coverage. The proposed rules cover the following:

  1. Health Exchange Eligibility and Employer Standards
    The first proposed rule affects tax credits for small employers participating in the federal Small Business Health Options Program (SHOP). Small employer purchasing employer-sponsored health coverage through SHOP could qualify to receive a small business tax credit for up to 50% of the employer's premium contributions toward employee coverage.
  2. Health Insurance Premium Tax Credit
    Under the second proposed rule, qualifying individuals and families would receive premium tax credits to help defray insurance costs. To be eligible for the premium tax credit, a taxpayer must have household income 100-400% of the federal poverty line amount for his/her family size ($22,350-$89,400 for a family of four in 2011). In addition, the taxpayer must not be claimed as a dependent by another taxpayer and, if married, must file a joint return.
  3. Medicaid Eligibility
    The third proposed rule would coordinate the exchanges with Medicaid and Children's Health Insurance Program (CHIP) eligibility. Most adults under age 65 with incomes up to 133% of the federal poverty line-$14,500 for an individual and $29,700 for a family of four in 2011-would be eligible for Medicaid. Children would be eligible for either Medicaid or CHIP at higher income levels based on the eligibility standards in their state.

HHS and Treasury announced they will conduct an outreach campaign and ask for public comment on the three proposed rules from employers, consumers, state leaders and health care providers and insurers. The IRS (on behalf of Treasury) invites written comments on the proposed regulations, which must be received by Oct. 31, 2011. Comments may be sent via www.regulations.gov. To view the proposed regulations by HHS and Treasury, please click here.

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» Energy, Transportation and Environment

FAA Reauthorization

Congress' failure to reauthorize the Federal Aviation Administration (FAA) bill giving the FAA the authority to collect (and therefore spend) airline tax revenue resulted in 4,000 FAA employees being furloughed and millions of dollars in FAA projects being halted, affecting another 70,000 jobs. As it stands now, the bill has been extended until September 16th. The non-agreement, in part, stemmed from $16.5 million in subsidies that has been used to assist 13 rural airports (since industry deregulation in 1978). The September 16th extension eliminates that $16.5 million, but the Department of Transportation has stated that it could continue to subsidize individual airports meeting the criteria for a waiver. The House bill had originally eliminated the entire Essential Air Service program by 2013 in 48 States (affecting 150 rural airports receiving a total of $200 million in subsidies). After negotiations, there were 13 remaining rural airports that became the sticking point in passage of reauthorization. But, the waivers are expected to be a temporary fix. House transportation leadership is not expected to budge on its position to eliminate the EAS program altogether when voting on reauthorization again in September.

Congress' Next Major Fight - Reauthorization of the Gas Tax

All of the nation's surface transportation program laws expire on September 30th of this year. Of note is the law authorizing the collection (and thus expenditure of) gasoline tax revenue. Transportation and Infrastructure Committee Chair Rep. John Mica (R-FL) earlier this year introduced a six-year proposal authorizing surface transportation programs. The proposal recommends reducing federal transportation programs by 34% and consolidating many existing programs into one block grant for states to spend according to their priorities. The Senate Committee on Environment and Public Works has assembled an impact sheet showing the effects such cuts would have on each state. NBCSL members can click on this link to see how their state would fare.

Though a new six-year reauthorization bill this fall seems unlikely, Congress is expected to extend the current law's authority for a short period of time so transportation programs in the country can continue. However, given the brinksmanship witnessed over the debt limit and the FAA bill, there is a very real possibility an extension may not be passed before September 30th, meaning that the inability of DOT to collect and spend tax revenue would furlough even more workers than the FAA stalemate.

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special report

On Tuesday, August 2, 2011, President Barack Obama signed into law the Budget Control Act of 2011, S. 365, a last-minute compromise plan to raise the nation's $14.3 trillion debt ceiling, narrowly averting what could have been an unprecedented default with ruinous economic consequences.

President Obama's signature capped a tumultuous negotiation with congressional leaders that spanned months before finally coming to a resolution on July 31st, two days before U.S. Treasury Secretary Timothy Geithner said the government would run short of money to pay its bills while lacking the authority to borrow any more. If the debt ceiling had not been increased before the end of August 2nd, Americans could have seen rapidly rising interest rates, a weakening of the dollar, and shakier financial markets, among other problems.

The signed legislation puts in place the annual discretionary spending caps found in the House bill previously passed worth about $917 billion in cuts over 10 years. But those caps, from $1.043 trillion in FY 2012 to $1.234 trillion in FY 2021, are now split between "security" and "non-security" spending, enforceable by across-the-board cuts. The act defines the security category as discretionary appropriations associated with agency budgets for the Department of Defense, the Department of Homeland Security, the Department of Veterans Affairs, the National Nuclear Security Administration, the intelligence community management account, and all budget accounts under international affairs. FY2012 and FY2013 are the only cycles where domestic programs are protected from decrease to meet the requisite reductions. From FY2014 to FY2021, discretionary spending can be reduced or capped in whatever fashion to achieve the targets set in the agreement.


What would the Debt Deal mean for individual areas of the Federal budget?
Let's take Education as an example.


If the joint committee does not reach agreement on required cuts by the deadline, $3 billion will automatically be cut per year from K-12 education discretionary funding for fiscal years 2013-2021. Bi-partisan commissions have not typically been successful in recent history, with one side usually withdrawing in protest. The average Federal spending level on education altogether over the last decade has been about $58 billion per year. 2009 is not part of this calculation due to the Recovery Act allocating $155 billion in one year (a statistical aberration). Education spending over the last ten years has increased on average about $3 billion per year. Thus, to cut $3 billion annually from FY2013 to FY2021 would mean the rate of spending for education must be reduced every year from the current level of $64 billion through FY2021 to get to an FY2021 allocation of $40 billion, the same level of spending for FY2001.

Bottom line? No new spending in education for ten years, plus incremental decreases in funding.


Summary of the Budget Control Act of 2011, S. 365

Cutting Discretionary Spending

  • Reduces discretionary spending by $1.2 trillion over ten years (as compared to the Congressional Budget Office's January adjusted baseline).
  • Cuts next year's discretionary spending by $7 billion in budget authority (and $27 billion in outlays) below the level enacted in the final 2011 Continuing Resolution, for a total discretionary budget of $1,043 billion in budget authority.
  • Keeps total discretionary spending below Fiscal Year 2011 levels for Fiscal Year 2013 by setting spending at $1,047 billion in budget authority.

Capping Discretionary Spending

  • Discretionary spending is capped each year for the next decade. If the spending caps are exceeded there is an across-the-board cut (known as a sequester) of discretionary spending (with a permissible exemption for military pay) to eliminate the excess spending.
  • The discretionary caps are codified and can only be changed by enactment of future legislation.
  • Eliminating Waste Fraud and Abuse
  • The act includes program integrity cap adjustments to ensure adequate funding of programs to reduce waste, fraud, and abuse in health care and Social Security.
  • These program integrity initiatives will generate additional savings in mandatory programs.
  • Similar program integrity adjustments were a successful part of the 1997 Balanced Budget Agreement.

Emergency Spending Reform

  • Provides a definition of emergency spending that specifies the spending must be for the prevention or response to the loss of life or property or a threat to national security that is unanticipated and temporary.
  • Requires the President and Congress to concur on the designation of any spending as an emergency.
  • Affirmatively provides Members of the House with the opportunity to offer an amendment during consideration of an appropriations bill to strike an emergency designation (thus subjecting the spending to the overall cap) and, if they wish, to offset the emergency spending with an across-the-board cut to other programs in the bill.
  • Joint Select Committee on Deficit Reduction
  • Creates a 12-member Committee tasked with developing recommendations to reduce the deficit by $1.8 trillion over ten years.
  • The Speaker of the House, House Minority Leader, Senate Majority Leader, and Senate Minority Leader will each appoint three members.
  • The Committee is required to report by November 23, 2011.
  • Both the House and the Senate are required to consider the Joint Committee's recommendations by December 23, 2011. In the Senate, the bill is not subject to filibuster.

Balanced Budget Amendment

  • Requires each Chamber to consider balanced budget amendments to the Constitution between October 1st and the end of the year.
  • Should an Amendment achieve the necessary 2/3rds in either chamber, the remaining chamber would be required to consider that particular Amendment.
  • Pell Grant and Student Loan Reforms
  • Reduces mandatory spending on student loans by eliminating the interest subsidy for graduate studies (elimination of interest subsidies was part of the House-passed Balanced Budget Act of 1995, though it never became law) and eliminating the subsidies for on-time repayments, such as lower interest rates and other rewards for payments automatically withdrawn from accounts. These provisions are said to save taxpayers approximately $22 billion.
  • Redirects $17 billion of the $22 billion in projected student loan savings to filling in the Pell Grant shortfall for 2012 and 2013, helping maintain the maximum Pell Grant award for eligible students.
  • Dedicates the remaining approximately $5 billion in savings to deficit reduction.

Debt Limit Increase

  • Upon enactment of the cuts contained in this bill, the President can exercise authority to increase the debt limit by $900 billion (of which $400 billion is available immediately). This authority is subject to disapproval in Congress. If a disapproval is enacted, the $400 billion increase is paid for through an across-the-board spending cut.
  • If the recommendations of the Joint Committee to reduce the deficit are enacted, the President may exercise authority to again increase the debt limit by up to $1.6 trillion. This authority is also subject to disapproval in Congress.

Joint Bipartisan Committee to Tackle Debt and Spending Crisis

It is important to note raises in the debt ceiling must be matched in spending cuts. The Joint Select Committee on Deficit Reduction also known as the "super-committee" is a 12-member panel composed of an equal number of Democrats and Republicans appointed by House and Senate Leadership created by the deal struck with President Obama and Congressional leaders in late July.

The super-committee is to provide recommendations for an additional $1.5 trillion in savings over the next decade that may come from spending cuts and tax increases. The super-committee must issue its recommendations by November 23rd, giving Congress until December 23rd to approve those provisions with no amendments or filibusters allowed. If passed by Congress, the debt limit may be raised by an additional $1.5 trillion in early 2012. If the super-committee makes recommendations and Congress fails to enact the requisite amount in savings, the debt limit may be raised only by $1.2 trillion early next year. This amount would be subject to disapproval from Congress. Also, a failure to agree on or enact recommendations would trigger across-the-board cuts in spending for hundreds of military and non-military programs, including Medicare.

The Joint Select Committee on Deficit Reduction includes the following members: Rep. Jeb Hensarling, R-TX; Sen. Max Baucus, D-MT.; Rep. Xavier Becerra, D-CA, Rep. Dave Camp, R-MI; Rep. James E. Clyburn, D-SC; Sen. Jon Kyl, R-AZ.; Sen. Rob Portman, R-OH; Sen. Patrick J. Toomey, R-PA; Rep. Fred Upton, R-MI; Rep. Chris Van Hollen, D-MD, and Sen. Patty Murray, D-WA.

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