Capitol to Capitol
An Information Service of NCSL's Standing Committees

Volume 17   Issue 37 - December 10, 2010


Today the U.S. Senate will debate the tax/unemployment insurance benefit framework agreed to last week by President Obama and congressional Republican leaders. The vehicle is a 74-page substitute amendment introduced last night by Majority Leader Harry Reid to H.R. 4853 that is very similar to the framework, which is summarized on NCSL’s webpage A two-year extension of individual federal income tax cuts, reinstatement of the estate tax, 13-month extension of unemployment insurance benefits, a one-year, 2 percent reduction in employee payroll taxes, and an extension of the Earned Income Tax Credit and other refundable credits form the core of Senator Reid’s amendment. He has added to the framework extensions to all of the expired federal tax credits including the NCSL-supported optional deductibility of state and local sales taxes. A potpourri of energy incentives for wind and solar power, ethanol production, energy efficient homes, renewable and alternative fuels, biodiesel and energy efficient appliances are also in his amendment. Not included are an extension of the Build America Bond program and reinstatement of the state death tax credit (“pickup tax”). First votes on the amendment are expected next Monday, Dec. 13. Yesterday, the House Democratic Caucus voiced its objection to the framework, primarily the terms of the estate tax reinstatement and the extension of the income tax cuts for high earners. Check NCSL’s webpage for updates. (NCSL staff contacts: Michael Bird, Jeff Hurley)


Well, maybe. On Dec. 8, the U.S. House of Representatives voted 212-206 on H.R. 3082, legislation continuing appropriations for all federal programs through Sept. 30, 2011. Because none of the dozen annual appropriations bills have made it to the president’s desk, either a continuing resolution like H.R. 3082 or an omnibus appropriations bill is needed to close the door on the annual appropriations process. The Senate is preparing an “omnibus” that would fold all 12 appropriations measures into one vehicle. Whether that strategy can survive various 60-vote tests is the key question today. The Senate omnibus sets discretionary spending at $1.108 trillion, $18 billion higher than the House-passed legislation. The Senate vehicle includes earmarks, while H.R. 3082 has none. For the most part, states would see most state-federal programs funded at or near FY 2010 levels in both versions. Furthermore, there are some members who prefer a short-term continuing resolution into next January or February, giving the 112th Congress final say on FY 2011 appropriations. Stay tuned. (NCSL staff contacts: Michael Bird, Jeff  Hurley)


This week, both the House and Senate overwhelmingly approved H.R. 4994 that prevents a scheduled 25 percent reduction in Medicare physician reimbursements. The legislation maintains current reimbursement levels through Dec. 31, 2011. The legislation also extends the Transitional Medical Assistance and Qualified Individual programs for the same period of time. President Obama has indicated he will sign this legislation. (NCSL staff contacts: Joy Johnson Wilson, Rachel Morgan)


Last week, three U.S. House members introduced legislation that would establish federal reporting and transparency standards for state and local government pension and retirement systems. H.R. 6494 (Reps. Nunes, Ryan and Issa) would establish new federal transparency standards and require use of the federally determined uniform accounting standards and “honest accounting of current public pension liabilities.” States that don’t comply with the federal reporting requirements would have their federal tax-exempt bonding authority suspended. The legislation also prohibits the federal government from “bailing out” any public pension plan. No action on this legislation is expected this year, but states should expect similar legislation to be introduced next January for consideration during the 112th Congress. (NCSL staff contact: James Ward)