Taxpayer's Tab: H.R. 2638/S. 1271, the Foreign Aid Transparency and Accountability Act of 2013

Vol. 5 Issue 3, January 23, 2014

Check out the Wildcard Bill of the Week section to learn about the measure to bring the Consumer Financial Protection Bureau into the normal budgetary process.

Most Expensive Bill of the Week

The Bill: H.R. 2638/S. 1271, the Foreign Aid Transparency and Accountability Act of 2013

Annualized Cost: $336 million ($1.68 billion over five years)

Increasing transparency of programs and spending is a laudable and important pursuit, but given the sheer size of the federal government, it can come with surprising costs.

 In its latest report to Congress, the United States Agency for International Development (USAID) disclosed that the U.S. spent a total $49.6 billion on assistance to foreign countries in 2013. Of that amount, $17.9 billion went to military assistance, while the other $31.7 billion consisted of economic aid.

In order to ensure that these massive sums of tax dollars are being spent appropriately, Congressman Ted Poe (R-TX) and Senator Marco Rubio (R-FL) introduced the Foreign Aid Transparency and Accountability Act. The bill would require the President to create measurable goals and evaluation standards for publicly-funded foreign assistance programs. It would also increase reporting standards and require the State Department to make data and reports available on a new website, ForeignAssistance.gov.

According to Senator Rubio's office, "Our goal is to ensure the highest possible efficiency and effectiveness of U.S. foreign assistance investments by requiring robust and uniform accountability -- and full transparency -- of each and every foreign aid dollar, so that we can measure our success."

The Congressional Budget Office (CBO) determined that increasing monitoring and evaluation of foreign aid agencies would require additional appropriations of $1.68 billion over five years. A staffer from the Senator's office informed us that it is their intent that this funding come from existing resources.

Note: The Digital Accountability and Transparency (DATA) Act of 2013, a related bill to improve and harmonize program reporting across the federal government, was covered in The Taxpayer's Tab last November.

To learn more or discuss this bill visit WashingtonWatch.com.

 

Least Expensive Bill of the Week

The Bill: H.R. 1772, the Legal Workforce Act

Annualized Savings: $658 million ($3.3 billion over five years)

Under U.S. law, companies can only legally hire employees who have been officially authorized to work in the United States. Currently, employers use the U.S. Citizenship and Immigration Services' (USCIS) Form I-9 to document and authenticate an employee's eligibility status. Employers can also confirm a worker's identity using the E-Verify system, which cross-references Form I-9 information with an online database of records available to the U.S. Department of Homeland Security (DHS) and the Social Security Administration (SSA).

Currently, use of this program is optional for most employers, however federal contractors are required to use it and several states have mandated its use. Members of Congress have been pushing to make the program mandatory for all employers since at least the 108th Congress (2007-2008). Most recently, Congressman Lamar Smith (R-TX) introduced H.R. 1772, the Legal Workforce Act. This bill would eliminate the paper-based Form I-9 system and create a mandatory, permanent version of E-Verify. Employers would have 30 months to enroll in the system.

According to CBO estimates, the bill presents upfront costs to DHS, the Social Security Administration, and other federal agencies, in order to upgrade technology, hire additional staff, and to prepare for increased administrative workloads in compliance with the legislation. Those changes would cost $634 million over the next five years.

However, CBO also assumes that the proposal would cause more workers to be paid outside of the tax system, which in turn would reduce government spending in the form of refundable tax credits. These are special tax credits that result in budgetary outlays because they are designed to target individuals with little or no income tax liability. In this case, CBO estimates that spending would be reduced by $3.9 billion, primarily for the refundable child tax credit. In FY 2013, total outlays resulting from the refundable child tax credit exceeded $23 billion.

To learn more or discuss this bill visit WashingtonWatch.com.

 

Most Friended

The Bill: H.R. 3135, the Domestic Partnership Benefits and Obligations Act of 2013

Annualized Cost: $11 million ($55 million over five years)

Number of Cosponsors: 77 House Members

When the Defense of Marriage Act, or DOMA, was enacted in 1996, the government prohibited recognition of the terms "marriage" and "spouse" when applied to same-sex couples. This meant that federal employees were not eligible to receive benefits that were available to spouses of heterosexual couples. DOMA was partially stuck down by the Supreme Court last year, which lead to the Office of Personnel Management -- the agency that oversees employee salaries, benefits, and policies -- to formally extend benefits to same-sex partners of federal workers whose civil unions had been legally recognized in their home state.

The change in law has opened up new debate in states and territories that have not legalized same-sex unions or marriages, which disallows partners of federal employees to receive benefits after the DOMA ruling. One solution has been introduced in the form of H.R. 3135 by Congressman Mark Pocan (D-WI). The bill would make all domestic partners of federal employees eligible for certain health and insurance plans that are offered to married workers' spouses. Federal studies would also be conducted to ensure the new regulations are followed and to investigate the effect on employee's premiums and other fees.

If enacted, H.R. 3135 would open federal benefits eligibility to more people and that would increase federal spending by $55 million over five years. NTUF scored the Act based on a 2012 CBO estimate from a similar proposal. That analysis predicted that the bill's provisions would affect less than one percent of federal employees.

Cosponsors include 75 Democratic and 2 Republican Representatives.

To learn more or discuss this bill visit WashingtonWatch.com.

 

The Wildcard

The Bill: H.R. 3519, Bureau of Consumer Financial Protection Accountability and Transparency Act of 2013

Annualized Cost: "No Cost" -- No New Funding

The Bureau of Consumer Financial Protection (BCFP) was established under the Dodd-Frank Wall Street Reform and Consumer Financial Protection Act in 2010 to regulate consumer financial products and to inform consumers. It operates currently within the Federal Reserve System and is funded automatically by a transfer of funds from the Reserve. The money spent by the BCFB is recorded as direct spending in the federal budget.

Sponsored by Congressman Randy Neugebauer (R-TX), H.R. 3519 would seek to bring the Bureau within the normal budget process, holding it accountable to legislators. The proposal would remove the BCFP from the Federal Reserve and repeal the automatic transfer of funds. Subsequently, the Bureau would be subject to the regular appropriations process. The bill would provide "such sums as may be necessary" for Fiscal Years 2014 and 2015.

CBO estimated that H.R. 3519 would reduce direct spending (i.e., the automatic funding the program currently gets) by a total of $2.9 billion over the next five years. The bill would also increase discretionary spending (spending subject to appropriation) in Fiscal Years 2014 and FY 2015 by $655 million -- an amount equal to the direct spending reductions for those two years. Because the bill would only authorize the program for two years, CBO's estimate records no outlay costs in later years.

At first glance, this would appear to be savings bill, but only because CBO's estimate follows the exact language of the bill which contains only a short-term authorization of spending. NTUF is not counting this as a savings bill: Based on the CBO report, there will be no change in spending by the BCFP during the 2-year authorization period. The actual spending levels beginning in FY 2016 will depend on actions taken by Congress in the future.

To learn more or discuss this bill visit WashingtonWatch.com.

   

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Missed an Issue?

Issue 2 - Jan 16
Building and Repairing Infrastructure with Domestic Gains in Employment (BRIDGE) Act

Issue 1 - Jan 10
Congress Already Revisiting Its Recently Passed Budget Deal

Issue 43 - Dec 19
Where Could Congress Cut Spending?

Issue 42 - Dec 6
Emergency Unemployment Compensation Extension Act

Issue 41 - Nov 22
Caregivers Expansion and Improvement Act


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