Window on Washington – March 7, 2022, Vol. 6, Issue 9

Outlook for This Week in the Nation’s Capital

Congress. The House and Senate are both in session this week. The House will vote on bills and resolutions related to homeland security, condemning the threats of violence against HBCUs, and condemning the attack on Congregation Beth Israel in Texas. The Senate is set to resume its consideration of the House-passed Postal Service Reform Act today. Both chambers also hope to finalize the FY22 appropriations process, but they may need to pass a short-term continuing resolution (CR) instead given some last-minute snags in the negotiations. Additionally, a broad overview of what’s in store for Congress this month can be found here. Hearings for the week include examining nominations, climate adaptation and resilience, the Farm Bill, electric vehicle manufacturing, workforce development investments,  and the FY23 NDAA for the U.S. Strategic and Space Commands.

Appropriations. Appropriators and their staffs are still working to finalize the FY22 omnibus package by this Friday’s continuing resolution (CR) deadline. Complicating their efforts to meet this deadline is the House Democratic retreat this week and the White House’s request for $10 billion in military and humanitarian aid for Ukraine and $22.5 billion for the COVID-19 response. Between the hundreds of riders still left to resolve as well as these supplemental measures, it is quite possible that there may be a short-term continuing resolution that would last only a few additional days in order to avoid a government crunch and to give Congress enough time to finalize and pass the omnibus. Separately, there are indications that the President’s FY23 Budget Request may be released late March/early April, but an exact date has not yet been confirmed. As of late Sunday night, House Democrats were still pushing to file an Omnibus bill Monday or Tuesday and vote on it before they leave for their annual retreat on Wednesday.  The key to meeting this timeline will be legislators converging on an approach to aid to Ukraine and possibly provisions to ban imports of Russian oil into the U.S.  Some GOP Senators want to slow down Ukraine aid to debate broader policy objectives vis-à-vis Russia, but neither side of the Congressional Leadership in both parties sees that as viable given events on the ground in Eastern Europe. It seems highly unlikely that the Administration will get its full request for additional COVID-19 aid given that nearly $100 billion in previous assistance for the pandemic remains unspent. This will be an evolving dynamic through the mid-week.

Supreme Court. Judge Ketanji Brown Jackson’s Supreme Court nomination hearings will begin on Monday, March 21. This timeline could allow for the Senate to vote on her confirmation before their two-week recess begins the week of April 11.

Ukraine. After Ukrainian President Volodymyr Zelenskyy’s weekend Zoom meeting with hundreds of members of Congress and a separate call with President Joe Biden, the White House indicated they are working on a deal to possibly send fighter jets to Ukraine and are in discussions with their European partners about banning Russian oil imports. Both issues contain significant risks economically in the case of an oil ban and militarily with respect to the perceived escalation of providing air defense to the Ukrainians.

Infrastructure. The Biden Administration provided a tentative Bipartisan Infrastructure Law (BIL)/IIJA implementation calendar for the next few weeks, which can be found here however, the information included is fairly limited in scope and is subject to change. As a reminder, Clark Hill is also tracking key agency guidance and requests for information (RFI) related to the BIL/IIJA here. Separately, Sen. Joe Manchin (D-WV) indicated last week that he could support a narrowed version of the Build Back Better initiative. His proposal includes choosing one 10-year program to focus on and devoting the other half of revenues raised from tax reform and prescription drug reform to deficit reduction and fighting inflation. It remains to be seen where Democrats will go from here.

Biden Administration.  President Biden will visit Fort Worth, Texas tomorrow to discuss his Administration’s efforts to support veterans. On Friday, he will join House Democrats in Philadelphia for the last day of their issues conference.  Vice President Kamala Harris will be in Poland and Romania from Wednesday through Friday to discuss Russia’s invasion of Ukraine and how the U.S. can provide support to Ukraine’s neighboring countries. First Lady Jill Biden will visit Arizona today and tomorrow, with visits to Phoenix and Tucson, to promote President Biden’s “Building a Better America” bipartisan policy initiatives, such as Cancer Moonshot and job training. Her trip will be followed by stops in Reno, Nevada and Fort Campbell, Kentucky as well.

Last Week in the Nation’s Capital

CONGRESS

Budget & Appropriations

Dems Agonize Over Manchin’s Wish List: Hours after President Joe Biden laid out what he hoped to salvage from Democrats’ defunct “Build Back Better” social spending plan, Sen. Joe Manchin (D-WV) quickly assembled a counteroffer. It might amount to deja vu for Democrats, many of whom still feel burned from last year’s debacle, yet many in the party are willing to entertain any shot they have to unify while they still have control of Congress. (Politico)

White House Aid Request Complicates Omnibus Spending Talks: Negotiations over an omnibus spending package remained far from complete last Thursday as the late arrival of a White House supplemental funding request threw a wrench in the talks. While both parties are eager to provide aid to Ukraine, Republicans continue to question whether additional appropriations are needed for the pandemic when funds are still available from prior relief laws. More than two thirds of the White House request, or $22.5 billion, would be used to address the pandemic needs like therapeutics, testing and vaccines, while the other $10 billion is for responding to the Ukraine crisis. (Roll Call)

Health

Senate Votes to End Covid-19 Emergency Declaration, Biden Threatens Veto: A bill by Senate Republicans to terminate the national emergency declaration for the Covid-19 pandemic passed 48 to 47 Thursday on a party-line vote. While the legislation has a slim chance of passing the Democrat-controlled House and President Joe Biden has already threatened to veto the bill, the vote is yet another rebuke of the administration’s pandemic policies at a time it is seeking billions from Congress to keep them going for several more months. (Politico)

Banking & Housing

Senate Banking Panel Delays Vote on Biden Fed Picks Amid GOP Boycott: The Senate Banking Committee did not vote on President Joe Biden’s nominees to the Federal Reserve board on Wednesday. (Bloomberg) 

Crypto/Blockchain

Democrats Press Treasury over Concerns Russia Could Use Cryptocurrency to Evade Sanctions: Democrats are pressing the Treasury Department for information around its plans to enforce sanctions compliance within the cryptocurrency industry as concerns rise over whether Russia could use digital assets to get around U.S. sanctions issued in response to its recent invasion of Ukraine. In the letter, lawmakers inquire about the agency’s “progress in monitoring and enforcing sanctions compliance by the cryptocurrency industry,” before going on to voice concerns “that criminals, rogue states, and other actors may use digital assets and alternative payment platforms as a new means to hide cross-border transactions for nefarious purposes.” (The Hill)

Transportation

Comer, Graves Launch Probe into Biden Administration’s Infrastructure Spending: House Committee on Oversight and Reform Ranking Member James Comer (R-KY) and House Committee on Transportation and Infrastructure Ranking Member Sam Graves (R-MO) sent a letter to White House Infrastructure Coordinator Mitch Landrieu requesting all documents and communications related to the $1.2 trillion in taxpayer dollars authorized in the Infrastructure Investment and Jobs Act (IIJA). (Clark Hill Insight)

Partisan Cracks Emerge Over How to Implement $1T Infrastructure Law: Partisan fissures emerged Wednesday during a Senate hearing about how to implement the $1 trillion bipartisan infrastructure package signed into law by President Biden last year. At a Senate Environment and Public Works Committee hearing, Republicans questioned Transportation Secretary Pete Buttigieg over a Biden administration memo that they say undermines the spirit of the law. (The Hill)

New Legislation Would Strip Ocean Carrier Antitrust Protections: Ocean carriers would no longer enjoy their limited antitrust immunity under new legislation aimed at curbing what some lawmakers and the Biden administration consider to be out-of-control market power. The Ocean Shipping Antitrust Enforcement Act, introduced last week by Rep. Jim Costa (D-CA), would amend U.S. shipping regulations by repealing section 40307 of Title 46 of the United States Code, which protects foreign carriers from certain antitrust laws. (Freight Waves)

Defense

Russia’s Invasion Will Boost 2023 Defense Budget, Top House Democrat Says: Russia’s invasion of Ukraine will boost the Pentagon’s funding for next year, the chairman of the House Armed Services Committee predicted on Thursday. Rep. Adam Smith (D-WA) spoke at an American Enterprise Institute event and said that the Russian invasion of Ukraine fundamentally altered what our national security posture and what our defense posture needs to be, making it more complicated and more expensive. (Defense One)

Lawmakers Push Navy to Reconsider Plans in Light of Ukraine: Citing the failure to deter Russian President Vladimir Putin from invading Ukraine, lawmakers pushed the Navy on Thursday to stop favoring long-term priorities over near-term needs. At a joint hearing of the House Armed Services Seapower and Readiness subcommittees examining naval strategy, Republicans argued the Navy needs to focus on assembling the most potent fleet it can in the near term to deter China from invading Taiwan and that Navy’s longer term plans, which includes a “divest-to-invest approach” to budgeting, may need to change. (Roll Call)

Homeland Security & Immigration

Lawmakers Express “Extreme Concern” Over Border Robot Dog Plan: A small group of Latino U.S. House members recently expressed “extreme concern” about a plan to potentially dispatch robot dogs along the U.S.-Mexico border. A letter was sent by U.S. Reps. Veronica Escobar (D-TX), Adriano Espaillat (D-NY) and Nanette Diaz Barragán (D-CA) seeking a meeting with U.S. Customs and Border Protection about the robots. (Axios)

Grassley, Durbin Introduce Bipartisan H-1B, L-1 Visa Reform Legislation: Sen. Chuck Grassley (R-IA), Ranking Member of the Senate Judiciary Committee, and Sen. Dick Durbin (D-IL), Chairman of the Senate Judiciary Committee, introduced bipartisan, legislation to reform and close loopholes in the H-1B and L-1 visa programs. The H-1B and L-1 Visa Reform Act will reduce fraud and abuse, provide protections for American workers and visa holders and require more transparency in the recruitment of foreign workers. (Clark Hill Insight)

Judiciary/Justice

Democrats Set Judge Jackson’s Confirmation Hearings for March 21: President Joe Biden’s pick for the Supreme Court, Judge Ketanji Brown Jackson, began traditional courtesy calls with senators on Wednesday as Democrats announced her confirmation battle would get underway later this month. The hearings will start on Monday, March 21 and conclude on Thursday March 24, setting Jackson on the path to what Democrats hope will be a speedy final confirmation vote, Senate Judiciary Chairman Dick Durbin (D-IL) announced. (ABC News)

Senate Rejects Democratic Bill to Codify Abortion Rights: The Senate voted 46-48 Monday to block a bill pushed by Democrats to codify abortion rights into federal law ahead of an expected Supreme Court decision that could limit access to the procedure. (NBC News)

Energy

Bipartisan Bill Banning Russian Oil Sets Up Clash with White House: A growing bipartisan group of lawmakers released legislation on Thursday that would block imports of Russian oil despite President Joe Biden’s opposition to cutting off the shipments, setting up a potential standoff over how to ratchet up punishments against Moscow for its war on Ukraine. (Politico)

Sens. Manchin, Barrasso Slam FERC’s ‘Political Agenda’ on Natural Gas, Say it will Stifle Development: The Federal Energy Regulatory Commission’s mid-February revision of its framework for reviewing proposed natural gas pipelines and liquefied natural gas (LNG) facilities will stifle gas development in the United States, some senators and two agency commissioners said Thursday during a hearing held by the Senate Energy and Natural Resources Committee. (UtilityDive)

EXECUTIVE BRANCH 

Budget & Appropriations

White House’s $32.5B Ukraine, COVID Supplemental Request: The Biden Administration has asked Congress to attach to the FY22 Omnibus package $10 billion in humanitarian and military aid for Ukraine and $22.5 billion in spending to address COVID-19 and to prepare for future pandemics. (Clark Hill Insight)

Health/HHS/NIH

Biden to Launch Ambitious Overhaul of Nursing Home Quality: President Joe Biden will use his State of the Union speech to launch a major overhaul of nursing home quality, including minimum staffing levels and steps to beef up inspections while continuing to keep COVID-19 at bay. (AP)

Biden Admin Slashes Covid Funding Request Amid GOP Opposition: The Biden administration is asking Congress for far less money to continue fighting the Covid-19 pandemic at home than agency leaders had insisted was needed just a few weeks earlier. The reduced figure — an acknowledgment of the mounting opposition from lawmakers to spending billions more on the pandemic — was part of a larger White House request that included $10 billion in new assistance for Ukraine. (Politico)

Department of Education

Klain: White House May Extend Freeze on Student Loan Payments Again: The Biden administration is considering once again extending the freeze on federal student loan payments and interest for roughly 40 million Americans before it expires at the beginning of May, according to a top White House official. “The president is going to look at what we should do on student debt before the pause expires, or he’ll extend the pause,” White House Chief of Staff Ron Klain said in an interview with the podcast Pod Save America that posted on Thursday evening. (Politico)

Banking & Housing/HUD

Fed’s Powell says War Could Fuel Inflation: Federal Reserve Chair Jerome Powell on Thursday acknowledged that spiking oil prices triggered by Russia’s invasion of Ukraine could stoke already high inflation, as a top industry executive and analysts warned that the surge could get a lot worse. (Politico)

U.S. Fed Proposes Tiered System to Review Master Account Applications: The Federal Reserve last week proposed a tiered framework for reviewing applications to obtain a master account with the U.S. central bank as part of an effort to ensure “transparent and consistent” review of those applications. (Reuters)

Crypto/Blockchain

Treasury Department Formally Adds Crypto Rules to Russian Sanctions Guidance: The U.S. government is warning crypto exchanges not to facilitate transactions for individuals and entities newly added to its sanctions list. The Treasury Department published new regulations banning U.S. persons from providing any support to certain Russian oligarchs and entities as part of an ongoing effort to sanction Russia over its invasion of Ukraine, with the rules taking effect on March 1. (CoinDesk)

Tax Reform/IRS

Fearing Filing Season Chaos, IRS Hits Pause on Web Tool for Child Tax Credit: The White House has put on ice an online tool it had widely promoted as a way for people at the bottom of the income ladder to collect Democrats’ signature Child Tax Credit payments. (Politico)

Transportation/DOT

NHTSA Proposes Significant Updates to Five-Star Safety Ratings Program: The U.S. Department of Transportation’s National Highway Traffic Safety Administration has proposed significant safety updates to its flagship 5-Star Safety Ratings program. These improvements are part of the Biden-Harris Administration’s efforts to improve safety on our nation’s roads and will help fulfill requirements included in the Bipartisan Infrastructure Law. (Clark Hill Insight)

Buttigieg Tells States to Consider Safety for Road Projects: The federal government has a new warning to states seeking billions of dollars from President Joe Biden’s infrastructure law to widen roads: protect the safety of pedestrians and bicyclists or risk losing the money. (ABC News)

U.S. FAA Expands Use of Review Boards in Certifying Airplanes: The Federal Aviation Administration (FAA) said it is expanding the use of independent safety expert groups to review new designs and technologies in certifying commercial aircraft. (Reuters)

Trade

Biden to Require Higher Share of U.S.-Made Parts for Products Purchased by Government: Products purchased by the federal government will be required to have a higher share of parts made in the United States to qualify as “Made in America” under a new rule that President Joe Biden announced last Friday. (USA Today)

USTR Releases 2022 President’s Trade Policy Agenda and 2021 Annual Report: Ambassador Katherine Tai and the Office of the United States Trade Representative last week delivered President Biden’s 2022 Trade Policy Agenda and 2021 Annual Report to Congress. The report details USTR’s work to implement the Biden Administration’s trade priorities and advance a worker-centered trade policy. (USTR)

Space/NASA & NOAA

Rogozin Takes Aim at Space Cooperation with the US & Europe, Including ISS: The head of Russia’s space agency took aim at cooperation with the United States, the United Kingdom, and Europe today both in words and actions. Not only did he threaten to prevent Friday’s launch of 36 OneWeb communications satellites unless the UK government divests itself as a OneWeb shareholder but hinted that Russia may reconsider cooperating on the International Space Station unless the Americans “cool down.” (Space Policy Online)

More Spaceports, More Problems: Despite the numerous regulatory, technical and business development challenges facing state and local authorities pushing new spaceport projects around the country, many seem undeterred by those obstacles or the fact that more than half of the current 13 FAA-licensed spaceports in the United States have yet to host a launch. Federal funding support has also been scant, with nothing provided in the recent bipartisan infrastructure package, and spaceports are also not eligible for FAA Airport Improvement Grants. (Space News)

Finally, We Know Production Costs for SLS and Orion, and They’re Wild: Appearing before a House Science Committee hearing on NASA’s Artemis program, NASA’s Inspector General revealed the $4.1 billion “unsustainable” production costs per mission, and took aim at NASA and particularly its large aerospace contractors for their “very poor” performance in developing these vehicles. With these comments, Martin essentially threw down his gauntlet and said NASA cannot have a meaningful exploration program based around SLS and Orion at this cost. (Ars Technica)

Defense/DOD

Pentagon Wants to Bolster Domestic Microelectronics Base with New Innovation Network: The DOD wants to create a network of regional hubs to mature microelectronics technology and manufacturing processes and strengthen the domestic industrial base. In a new request for information released Thursday, the department asks industry, academia, government labs and domestic semiconductor manufacturers for input on its Microelectronic Commons concept, which originated with a cross-functional team led by Under Secretary of Defense for Research and Engineering Heidi Shyu. (Defense News)

DHS & Immigration

U.S. Offers Temporary Legal Status to Ukrainians, Citing Russian Attack: The Biden administration on Thursday offered tens of thousands of Ukrainians living in the U.S. a temporary humanitarian protection from deportation due to the ongoing Russian military offensive in Ukraine. Department of Homeland Security (DHS) Secretary Alejandro Mayorkas created an 18-month Temporary Protected Status (TPS) program for Ukrainians who have lived in the U.S. since March 1, allowing eligible people to apply for work permits and deportation protections. (CBS News)

Appeals Court says U.S. Can’t Send Migrant Families to Danger, but Can Expel Them Without Hearing: A federal appeals court on Friday said the Biden administration may expel migrant families from the U.S. without hearing their asylum claims, but barred the government from sending them to countries where they would likely be persecuted or tortured. (Roll Call)

Judiciary/DOJ

DOJ Weighs in on Reciprocal Switching: The U.S. Department of Justice (DOJ) has submitted comments to the Surface Transportation Board (STB) on reciprocal switching, in advance of STB’s March 15-16 hearing on the subject that has divided freight railroads and many of their major customers. (Railway Age)

Cyber

White House Endorses Senate Cyber Incident Reporting Bill That DOJ Just Criticized: The Senate passed a wide-ranging cybersecurity bill, S.3600, on Tuesday, which among other provisions would require a wide range of companies responsible for U.S. critical infrastructure to report cybersecurity incidents to the government to CISA. A White House statement of support late Thursday came just a day after senior leaders of the Justice Department and the FBI sharply criticized the bill for not requiring hack reports to go jointly to CISA and the bureau. (Politico)

SEC to Meet on Cybersecurity Amid Fear of Russian Threat to Financial Sector: The Securities and Exchange Commission will meet March 9 to consider changes to its cybersecurity enforcement as lawmakers look to bolster the financial sector from disturbance following the exclusion of Russian banks from the Society for Worldwide Interbank Financial Telecommunication, or SWIFT, and other sanctions against Russian entities. (Next Gov)

EPA & DOI

Biden Administration Studying Whether Biofuel Waiver Could Ease Food Inflation: U.S. President Joe Biden’s administration is studying whether waiving biofuel blending mandates could help offset a surge in prices for key food ingredients like corn and soy oil following Russia’s invasion of Ukraine. (Reuters)

Department of Energy

White House Eyes Reducing Russian Oil Imports: President Biden is considering steps to reduce U.S. imports of Russian oil, the White House said Friday, as bipartisan support in Congress for a ban on the imports grows amid the Russian invasion of Ukraine. (The Hill)