Lawmakers Reach Agreement in Principle to Fund Border Security

Posted on 02/12/2019 6:14 AM

No disaster aid funding in spending agreement; unknown fate for biodiesel language


Congressional negotiators say they've agreed "in principle" to a fiscal 2019 spending deal that provides $1.375 billion for physical barriers (55 miles of new fencing, just 9 miles shy of Trump’s last budget request) along the southwest border. It would also give Immigration and Customs Enforcement funding to house an average daily detainee population of 40,520. That’s 5,000 more than Democrats wanted, but less than the 52,000 President Donald Trump pushed for. Democrats agreed to drop a proposed cap on the number of detainees ICE could round up inside the U.S. There is no funding for disaster aid — lawmakers said they would address it separately. No word yet on whether it includes language extending the lapsed biodiesel incentive program. Bill text could come as soon as today; if not, on Wednesday. There may not be enough to time to move the package through both chambers before current stopgap funds expire Friday; if not, a very short continuing resolution might be required. House Speaker Nancy Pelosi (D-Calif.) is on board regarding the agreement while Trump’s signature still isn’t guaranteed.
     President Trump late this morning holds a Cabinet meeting and this could be, other than a sudden Tweet, the first time he officially comments on the congressional agreement in principle on border security.
     The House is postponing votes and some committee meetings today as members attend memorial services in Michigan for former Rep. John Dingell (D-Mich.).
     No updates on ongoing U.S./China trade policy talks were provided by U.S. negotiators in Beijing other than saying the U.S.-imposed March 1 deadline for results stands.
     USDA is seeking comments on how commodity and conservation programs and crop insurance should operate under the 2018 Farm Bill. USDA has scheduled a listening session on implementation of the farm bill on Feb. 26.

 

Congressional negotiators reached an agreement on border security spending sans disaster aid. “We reached an agreement in principle between us on the Homeland Security and the other six bills," Senate Appropriations Chairman Richard Shelby (R-Ala.) said after meeting with other Appropriations panel leaders from both chambers. There may not be enough to time to move the package through both chambers before current stopgap funds expire Friday; if not, a very short continuing resolution might be required.

Pelosi on board. House Appropriations Chairwoman Nita Lowey (D-N.Y.) said House Speaker Nancy Pelosi (D-Calif.) was on board with the agreement. No comments were received from President Donald Trump. "We think so," Shelby said when asked if he knew whether Trump would back the emerging compromise, but he added: "We hope so." “The White House has been consulted all along,” Shelby added, noting that he’s been given “latitude” to negotiate on behalf of the administration.

The omnibus package (HJRes 31) text will be released later this week (today or Wednesday) and totals more than $320 billion for the seven remaining spending bills.

The Homeland Security language is expected to include roughly $49.4 billion in regular discretionary spending, plus additional funds set aside for future disaster-related emergencies. That's about $1.7 billion more, 3.6%, than Congress appropriated for fiscal 2018.

The measure will set aside $1.375 billion for physical barriers along the southwest border, about the same as the fiscal 2018 omnibus measure provided, when planning and design funds are factored in. That would be enough to construct 55 miles of barriers along the Rio Grande Valley. It would be considerably less than the $5.7 billion President Trump demanded, though administration officials have said they may "reprogram" existing funds from other accounts to make up some of the difference.

Language was included that is similar to last year's prohibition on using new designs, other than existing fencing prototypes. Democrats have said the stipulation is intended to prevent any concrete wall-building. But "steel slats," as Trump has embraced, would be allowed.

In return, House Democrats agreed to drop a proposed 16,500-person cap on the number of detainees Immigration and Customs Enforcement can round up inside U.S. borders. The negotiators also agreed to provide enough funds for ICE to house 40,520 detainees by the end of the fiscal year, similar to what Senate appropriators proposed last June and 5,000 more than House Democrats wanted, but well below the 52,000 average daily population Trump wanted. The agreement would require a 17.4% drop from the current level of 49,057 detainees by Sept. 30. Senior aides said the average daily population of ICE detainees this fiscal year would work out to 45,274 under the deal, considering the higher starting point.

The agreement includes authority for the agency to shift up to $750 million from other accounts, which would enable ICE to house up to 58,500 detainees if surges materialize.

Shelby said the package won't include a disaster aid title for victims of last year's hurricanes, wildfires and other catastrophic weather events. Lawmakers said they would address it separately. Since the 116th Congress began last month, the House has passed a $14.2 billion measure (HR 268) and the Senate has taken up a $12.7 billion bill, but neither made it into law.

The package will include the Agriculture, Commerce-Justice-Science, Financial Services, Interior-Environment, State-Foreign Operations and Transportation-HUD bills. Those measures were largely agreed to months ago.

Combined with Homeland Security, the seven bills represent about 25% of this year's discretionary spending allocation; the other $1 trillion became law before the elections in two bunches. The second package included the two largest of the 12 spending bills, Defense and Labor-HHS-Education.

Lawmakers and the White House still need to work out how much to increase statutory spending caps for next fiscal year, which are set to drop by 10% overall from fiscal 2019 without action from Congress.

U.S./China trade policy update:

  • The U.S.-imposed March 1 deadline to reach a comprehensive agreement with unambiguous enforcement will not be extended, according to U.S. trade negotiator David Malpass, undersecretary for international affairs, in Beijing this week. A growing number of observers believe that if enough progress comes during this week’s talks, the deadline will be extended in order to clinch a deal.
  • No meeting update was provided as Malpass and other members of the deputy-level delegation, led by deputy trade representative Jeffrey Gerrish, did not respond to other questions today about the progress of the latest round of negotiations.
  • A meeting between President Donald Trump and Chinese leader Xi Jinping is still murky. The South China Morning Post reported on Monday that one preliminary proposal being discussed was for the two leaders to meet on the southern Chinese island of Hainan, around the time of the annual Boao Forum for Asia, which will take place from March 26 to 29. “He wants to meet with President Xi very soon,” White House adviser Kellyanne Conway said yesterday on Fox News. “This president wants a deal. He wants it to be fair to Americans and American workers and American interests.”
  • The Pentagon warned China is developing sophisticated space capabilities such as “satellite inspection and repair” that could be used as weapons against American satellites. China disputed the claim.
  • Secretary of State Mike Pompeo has cautioned allies against deploying gear from the Chinese telecom equipment giant on their soil, which the U.S. believes could be used for espionage. "If that equipment is co-located where we have important American systems, it makes it more difficult for us to partner alongside them,” he said.
  • The Senate Small Business Committee, chaired by Sen. Marco Rubio (R-Fla.), is expected to release a report alleging “industrial espionage and coercion” by Beijing.

Farm-state lawmakers sent a letter to House leaders calling for a multiyear extension of biodiesel tax incentives. The representatives signing the letter (link) said they “strongly support a multi-year extension of the incentive to provide the policy certainty necessary to help the biodiesel industry and rural economies continue to grow.”

USDA is seeking comments on how commodity and conservation programs and crop insurance should operate under the 2018 Farm Bill. USDA has scheduled a listening session on implementation of the farm bill on Feb. 26. The questions USDA wants comment on are included in a Federal Register notice expected to be published Feb. 14 (link).

Malaysia plans to boost palm oil content in biodiesel in 2020. Malaysia plans to increase the palm oil content in biodiesel for the country's transport sector to 20%, doubling it from the current level, according to Primary Industries Minister Teresa Kok.

     The effort will include an increase in the level of palm oil in biofuel for the industrial sector to 10% from a current 7% mark, she said.

     The country is facing hefty domestic supplies of palm oil and the plan on biodiesel is expected to increase palm use in biofuels to 1.3 million tonnes annually, Kok said. She also signaled they have submitted a plan to the cabinet to establish a biofuel stabilization fund to manage prices for biofuels, Kok said, which reports indicate would be similar to Indonesia's export levy fund. "What if the palm oil price is high and the diesel price has gone up a lot? That would be costly for the public to use biodiesel, so we need to stabilize the price so biofuel will be more attractive to consumers," Kok said. "I have suggested (a stabilization fund) in cabinet meeting before but we still need to have deeper discussion with other ministries."

Other items of note:

  • The Senate today will take up the nomination of William Barr to be attorney general, with a vote on a motion to limit debate scheduled to follow work on a public lands bill. The Senate Judiciary Committee approved the nomination along party lines, and Barr is expected to have enough Republican support on the floor to replace Matthew Whitaker as the head of the Justice Department.

  • Reuters: E15 plan could come sans RIN reform. EPA is weighing the release of a draft proposal to expand the sales of E15 blends of gasoline without introducing biofuel credit trading limits, Reuters reports (link), citing three sources familiar with the matter. Some in the oil industry have argued for RIN reform to reduce costs. The agency may take the step as it wants to speed the process for E15, the report noted, with officials pledging to get the E15 rule in place by the start of the summer driving season. However, oil interests are likely to chafe at the action as they have been expecting the agency to move the two plans in tandem. The partial government shutdown slowed work on the plans, the report noted. When EPA unveiled its final levels for 2019 biofuels (and 2020 biodiesel), it noted that the agency would come forward with proposed reforms to the Renewable Identification Number (RIN) market.

  • Green New Deal booboo. An aide to Representative Alexandria Ocasio-Cortez (D-N.Y.) said a summary of her plan to combat climate change was published accidentally. The document included provisions not endorsed by the candidates.

  • Supreme Court will hear arguments April 22 in a case that could determine whether USDA must comply with a Freedom of Information Act request to release SNAP retail sales data. The case pits grocery companies against a small South Dakota newspaper.

  • Legislators in Georgia are pushing for a 4% tax on Netflix and other streaming services, such as digital books and music downloads, that would subsidize construction of high-speed internet lines in rural areas. If you spend $13 on a Netflix subscription, you could be taxed about 50 cents on your bill.

Markets. The Dow on Monday was down 53.22 points, 0.21%, at 25,053.11. The Nasdaq rose 9.71 points, 0.13%, at 7,307.90. The S&P 500 added 1.92 points, 0.07%, at 2,709.80.

Theresa May updates lawmakers on Brexit. The British prime minister will give a statement on her negotiations with Dublin and Brussels over the Irish border, as she tries to gain more support for her Brexit deal ahead of a parliamentary debate on Thursday.

President Trump and New York Governor Andrew Cuomo plan to meet today to discuss a change that Democrats from states like New York, New Jersey and California have been pushing to a 2017 tax law.


 

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