Budget and Revenue Standing Committee

Federal Budget and Revenue Update

August 22, 2007
Volume 13, Number 12

An Information Service of the NCSL Budgets and Revenue Committee

August Recess
Prior to adjourning for the August recess, the U.S. House approved the last of its annual appropriations bills—Agriculture and Defense. The U.S. Senate has adopted only one of its annual appropriation bills—Homeland Security.

As September 30, 2007 approaches (the end of the 2007 Federal Fiscal Year), Congress will be hard-pressed to finalize the annual appropriations bills. In addition, the President has issued veto threats for all but one of the annual appropriations measures—State and Foreign Operations.

Table 1: FY 2007 Appropriations Bills

Approved by House Subcommittee

Approved by House Committee

Approved by House

Approved by Senate Subcommittee

Approved by Senate Committee

Approved by Senate

Agriculture

7/12/2007

7/19/2007

7/25/2007

7/17/2007

7/19/2007

Commerce/Justice/Science (S. 1745)

6/11/2007

7/12/2007

7/26/2007

6/26/2007

6/28/2007

Defense

7/12/2007

7/25/2007

8/5/2007

Financial Services and General Government
(H.R. 2829)

6/5/2007

6/11/2007

6/28/2007

7/10/2007

7/12/2007

Energy & Water (H.R. 2641; S. 1751)

5/23/2007

6/6/2007

7/17/2007

6/26/2007

6/28/2007

State/Foreign Operations   (H.R. 2764)

6/5/2/007

6/12/2007

6/21/2007

6/28/2007

Homeland Security (H.R. 2638; S. 1644)

5/18/2007

6/5/2007

6/15/2007

6/13/2007

6/14/2007

7/26/2007

Interior & Environment   (H.R. 2643; S. 1696)

5/23/2007

6/7/2007

6/27/2007

6/19/2007

6/21/2007

Labor/HHS/Education (H.R. 3043; S. 1710)

6/7/2007

7/11/2007

7/19/2007

6/19/2007

6/21/2007

Legislative Branch (H.R. 2771; S. 1686)

6/6/2007

6/12/2007

6/22/2007

6/19/2007

6/21/2007

Military Construction/Veterans Affairs
(H.R. 2642; S. 1645)

5/22/2007

6/6/2007

6/15/2007

6/13/2007

6/14/2007

Transportation/HUD (H.R. 3074; S. 1789)

6/11/2007

7/11/2007

7/24/2007

7/10/2007

7/12/2007

Implementation of the 9/11 Commission Recommendations
On August 3, the President signed Implementing Recommendations of the 9/11 Commission Act of 2007 (P.L. 110-53). The legislation further implements the comprehensive recommendations made in July 2004 by the 9/11 Commission, including adjustments to the Homeland Security Grant Program. In particular, the bill:

Reduces the state minimum award under the State Homeland Security Grant Program (SHSGP) from 0.75 percent in FY 2007 to 0.375 in FY 2008 and to 0.35 percent in FY 2012;
Requires the remaining Homeland Security Grant Program funds to be distributed based upon risk, rather than population.

The bill also amends the Interoperability Grant Program (See previous newsletter Vol. 13, No.11) created under the Deficit Reduction Act of 2005. The law:

establishes state minimums of 0.50 percent (FY 2008) to 0.35 percent (FY 2012); and
provides $43.5 million to implement the E-911 Act, which provides grants to states to upgrade their public safety answering points (the program had not been funded since its adoption in the Deficit Reduction Act of 2005).

Sales Tax Fairness and Simplification Act
On August 3, 2007, Representative William Delahunt (D-Massachusetts), Representative Spencer Bachus (R-Alabama) and Representative Ray LaHood (R-Illinois) introduced the Sales Tax Fairness and Simplification Act (H.R. 3396), to give those states that have complied with the Streamlined Sales and Use Tax Agreement (Agreement) the authority to require out-of-state sellers to collect sales tax on remote sales. The bill includes a small business exception (SBE), whereby a seller that has gross-remote taxable sales below $5 million is not required to collect under the Agreement. The Senate version of the bill, S. 34, was introduced in May by Senator Mike Enzi of Wyoming. To read the full text of H.R. 3396, click here: http://frwebgate.access.gpo.gov/cgi-bin/getdoc.cgi?dbname=110_cong_bills&docid=f:h3396ih.txt.pdf

Senate Department of Homeland Security Appropriations for FY 2008
On July 26, the Senate adopted the Department of Homeland Security Appropriations for FY 2008 (Sub. H.R. 2638). The full Senate adopted several amendments over the committee approved appropriations, including:

an additional $3.0 billion for border security, including the hiring of additional border patrol agents, construction of fencing along the U.S./Mexico border and funds for the detention and removal of illegal aliens;
an additional $100 million for the Interoperability Grant Program (no funds were provided by the Senate Appropriations Committee); and
an additional $60 million for the Employment Eligibility Verification System (no funds were provided by the Senate Appropriations Committee).

An amendment offered by Senator Alexander of Tennessee to provide $300 million to assist states with the implementation of the Real ID was tabled (killed) by a vote of 50 to 46. To see how your Senator voted, click here: http://www.senate.gov/legislative/LIS/roll_call_lists/roll_call_vote_cfm.cfm?congress=110&session=1&vote=00279

The House and Senate will conference on the Department of Homeland Security Appropriations for FY 2008 after the August recess. The President has issued several veto threats on the House and Senate versions of the bill because each bill exceeds the President’s FY 2008 budget request.

Debt Ceiling
On July 30, the Secretary of the Treasury notified Congress that the United States will reach the debt ceiling of $8.965 trillion by early October. The debt ceiling sets the borrowing limits of the United States government, which is statutorily set by Congress. The debt ceiling was last increased in March of 2006.

NCSL Annual Meeting
The NCSL 2007 Annual Meeting in Boston, Massachusetts concluded August 10^th. Visit the NCSL website for highlights on the Budgets and Revenue Committee. http://www.ncsl.org/index.htm?tab=meeting

NCSL Fall Forum
The NCSL Fall Forum will be held November 26^th through December 1^st in Phoenix, Arizona. Details to follow.