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This bill was originally the \"Ensuring Tax Exempt Organizations the Right to Appeal Act,\" aimed at creating an appeals process for tax-exempt organizations who had their status rejected by the IRS. Passed through committee and approved by a House voice vote, and into the hands of the Senate, this bill became something completely unrelated. Through the amendment process, the Senate turned the original bill into a legislative vehicle for two other bills about trade. After alternative trade legislation passed Congress and was signed into law, this bill was repurposed again as the legislative vehicle for the bipartisan budget agreement constructed by Congressional Republicans and the White House.

As a two-year budget agreement, this legislation is quite expansive, and establishes spending levels for all areas of the federal government government over the next two years. On balance, the spending levels proposed in this budget agreement are expected to reduce aggregate deficits by more than $75 billion over the 2016-2025 period.

The budget proposal also raises discretionary spending caps (aka sequester caps) for both defense and domestic programs. In fiscal year 2016, the defense and domestic discretionary spending limits would rise by $25 billion, while the caps would be lifted by $15 billion for fiscal year 2017. This leads to a $50 billion increase in the caps for fiscal year 2016, and a $30 billion increase for fiscal year 2017 — leading to a total increase of $80 billion.

Health Care

The requirement for large employers (more than 200 employees) to automatically enroll new full-time employees into a qualifying health plan, if one is offered, would be repealed.

This bill prevents a substantial increase in Medicare Part B premiums paid by beneficiaries who are not held harmless. Rather than increasing to $159.30 the premium would be held at $120.

Social Security

Cooperative Disability Investigations (CDI) units would be empowered to investigate Social Security fraud nationally with the assistance of state and local law enforcement to investigate suspected fraud before benefits are awarded. There would also be new and stronger penalties for Social Security fraud, including a new felony punishable by up to five years in prison, fines of up to $250,000 or both.

The cap adjustment for Social Security would be increased for fiscal years 2017-2020 by $484 million over that periods. Beyond existing purposes, funds could be used for CDI units and Special Assistant U.S. Attorneys who prosecute Social Security fraud, and work-related continuing disability reviews.

The Disability Insurance Trust Fund would receive an additional 0.57 percentage points (or a total of 2.37 percentage points of the 12.4 percent payroll tax) in 2016, 2017, and 2018. This would enable the payment of benefits until 2022 without increasing the total payroll tax.

Unintended loopholes in Social Security’s rules related to dual enrollment and benefit suspension would be closed.

Coordination between the Office of Personnel Management (OPM) and the Social Security Administration (SSA) would be improved by allowing SSA to repay Federal Employee Retirement System (FERS) benefits to OPM when OPM overpays.

Debt Limit

The debt limit would be lifted temporarily through March 15, 2017. On March 16 of that year, the public debt limit would be increased by the amount of obligations issued that have their interest and principal guaranteed by the federal government that are outstanding. Obligations that aren’t issued out of necessity to fund a commitment incurred by the government requiring payment before March 16, 2017 wouldn’t be considered.

The Secretary of the Treasury would be prohibited from abusing the suspension of the debt limit to build up cash balances beyond normal operating balances.

Judiciary

All federal agencies that have civil monetary penalties would be required to update the value of those penalties to reflect changes in inflation between 1996 and October 2015. The increase would be capped at 150 percent, so that a penalty currently set at $10,000 couldn’t increase to more than $25,000. Going forward, agencies would be required to adjust their penalties annually based on changes in the rate of inflation.

About $1.5 billion would be rescinded and permanently canceled from the Crime Victims Fund, which would preserve adequate balance to meet the program’s funding needs for the foreseeable future. Also, $756 million from the Dept. of Justice Asset Forfeiture Fund would be rescinded and permanently canceled.

Pensions

Single-employer fixed pension premiums would increase from $64 per person in 2016 to $68 in 2017, $73 in 2018, and $78 in 2019 — and premium increases would be indexed to inflation thereafter.

Pension plan liabilities have to be valued using spot interest rates or the interest rates on corporate grade bonds. Currently, liabilities from 2012-2017 aren’t deemed to vary by more than 10 percent from the average interest rates over the prior 25 years, and that cap grows by 5 percent per year through 2021 when it would remain at 30 percent. This legislation would change that, freezing the interest rate corridor at 10 percent through 2019, at which point it grow by 5 percent per year until 2023, after which it would remain at 30 percent. By changing this, Congress anticipates that employers would defer taking advantage of the tax deductible pension contributions to a later date, resulting in greater tax receipts during the interim.

Strategic Petroleum Reserve

The Dept. of Energy (DOE) would be required to notify Congress of any test sales from the Strategic Petroleum Reserve (SPR). It would also be authorized to include terrorism in the definition of a “severe energy disruption” that would allow sales from the SPR.

58 million barrels of oil could be sold from the SPR between 2018 and 2025, but sales are prohibited if it’s determined the sales would undermine its ability to reduce the adverse impacts of severe domestic energy supply interruptions. Up to $2 billion in proceeds from such sales would go towards the Energy Security and Infrastructure Modernization Fund subject to approval by Congress.

Other Provisions

Federal Crop Insurance would be modified to require the renegotiation of the Standard Reinsurance Agreement before the end of 2016 and at least once every five years thereafter. The overall rate of return for the insurance providers would be capped at 8.9 percent, as it currently sits at 14.5 percent.

To improve the collection of debts owed to the U.S. government, automated telephone calls would now be allowed to be made to cell phones. The Federal Communications Commission would be directed to issue regulations on the matter.

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Like Causes?

ElizabethWarren

Raising the Debt Limit and Establishing a Two-Year Budget