Capitol to Capitol | Vol. 22, Issue 20

12/16/2015

Capitol to CapitolLAST LAW LEFT BEHIND. On Thursday the president signed into law a major education overhaul, giving states more flexibility and authority on education governance. The Every Student Succeeds Act, which replaces the previous education iteration, No Child Left Behind, received bipartisan support in both the House and Senate, passing by votes of 359-64 and 85-12, respectively. It eliminates the current federal accountability system, based on the Adequate Yearly Progress metric, and allows states to construct their own accountability systems. NCSL sent a letter to congressional leaders urging enactment of the conference agreement and acknowledging the traditional role of states and localities in guiding education policy. NCSL thanks state legislators who contacted their congressional delegates to voice support for this legislation. A comprehensive summary compiled by NCSL staff can be found hereNCSL staff contacts: Lee Posey, Ben Schaefer

WALKING IN A FISCAL WONDERLAND. On Tuesday night, two separate but significant bills were unveiled that would avert a government shutdown, fund the federal government for the remainder of the 2016 federal fiscal year, and provide finality for a litany of tax provisions for individuals and businesses (see below). The Continuing Appropriations Act (H.R. 2029), introduced just one day before current funding will expire, if enacted would complete the FY 2016 appropriations process for all 12 spending bills. The $1.15 billion omnibus package abides by the Bipartisan Budget Act passed in early November that increased discretionary spending for both defense and nondefense funding allocations. Congress will likely pass the third continuing resolution today to allow lawmakers time to review each measure. Both H.R. 2029 and the tax extenders bill are moving on a parallel track, with the House expected to vote on final passage Friday and the Senate following up shortly thereafter. The Federal Funds Information for States (FFIS) has provided a comparison of FY 2016 discretionary and mandatory funding for select state-federal programs. NCSL will provide additional information on both the omnibus and tax extenders agreement in the days ahead. NCSL staff contact: Jeff Hurley

’TIS THE SEASON FOR TAX EXTENDERS. Congress released a $650 billion tax package on Tuesday in conjunction with the aforementioned spending measure that permanently extends a majority of the so-called “tax extenders.” The package addresses more than 50 tax provisions on both businesses and individuals that have been extended on a temporary basis over the past 10 years. Perhaps the most notable provision made permanent for states is the deduction for state and local sales taxes. NCSL has been a strong supporter of making this provision permanent, which helps ensure federal neutrality on state tax structures. The research and experimentation tax credit, enhanced child tax and earned income tax credits, and several charitable deductions were also made permanent in the federal tax code. In addition, the tax package includes a two-year moratorium on the medical device tax, as well as postponing the “Cadillac tax,” a 40 percent excise tax on high-end employer health benefit plans, from starting in 2018 to 2020. NCSL staff contact: Jeff Hurley

DRIVING IN THE FAST LANE. On Dec. 4, three days after being finalized by U.S. House and Senate conferees, the president signed into law the Fixing America’s Surface Transportation (FAST) Act, a five-year, $305 billion reauthorization for the nation’s federal highway and public transportation programs. Coming in at more than 1,300 pages, the FAST Act is the first transportation legislation lasting more than two years since 2005. NCSL issued a statement in support of the bipartisan agreement. “We applaud congressional leaders coming together on the FAST Act, which ensures the predictability and funding needed to support our nation’s surface transportation infrastructure systems,” NCSL President Senator Curt Bramble (R-Utah) said. The agreement provides a 5 percent increase in highway funding and an 8 percent increase in transit funding in the first years compared to current spending, with annual increases thereafter. The FAST Act contains offsets to cover the full cost of the bill, including a transfer from a Federal Reserve surplus account into the Highway Trust Fund, which is forecasted to have annual deficits of approximately $15 billion. NCSL staff contacts: Ben Husch, Melanie Condon

NCSL TARGETS FEDERAL PRE-EMPTION IN TRADE BILL. On Dec. 15, NCSL transmitted a letter to the U.S. Senate urging them to remove language in a House passed trade and customs bill that would permanently extend the Internet Tax Freedom Act (ITFA), legislation that prohibits state and local governments from taxing Internet access. The provision also would remove the grandfather provision that currently allows seven states to tax Internet access. The provision was added to the conference report of H.R. 644, the Trade Facilitation and Trade Enforcement Act of 2015, and was passed by the House on Dec. 11. NCSL called upon Congress to first pass eFairness legislation giving states authority to require collection of sales taxes on online and remote transactions before considering an extension of ITFA. The Senate parliamentarian has ruled that the Internet taxation provision is not germane to the underlying legislation and can only remain in the legislation if the Senate achieves a 60 vote threshold to waive it. NCSL staff contact: Max Behlke

2015 NCSL CAPITOL FORUM HIGHLIGHTS.Unable to attend last week’s Capitol Forum? NCSL’s resources pageincludes PowerPoints, handouts and audio from the meeting. Resources will be added in the week ahead, so check back for updates! 


Capitol to Capitol is a publication of the National Conference of State Legislatures, the premier bipartisan organization representing the interest of states, territories and commonwealths. The conference operates from offices in Denver and Washington, D.C.