Hearings of the
Subcommittee on Rules and Organization of the House
H.R. 350 - Mandates Information Act of 1999
As you will recall, 3½ years ago, 394 Members of the House and 91 Senators voted to pass the Unfunded Mandates Reform Act of 1995, also known as UMRA.
UMRA ensured that, for the first time, before the House voted on measures that imposed unfunded mandates, we:1) understood the costs to state and local governments and the private sector; and 2) with regard to the public sector, had a separate debate and vote on whether to consider the legislation, notwithstanding the unfunded mandate.
This additional requirement on the public sector doesn't mean we never mandate on state and local government - but it does ensure we do so with complete information, a separate debate, and full accountability.
And, we have an excellent track record. The practical impact of the UMRA has generally been to force committees to address the mandates issue long before bills reach the House Floor. In the first key test case -- the Telecommunications Act -- the threat of the point of order ensured that the Conference Committee did not impose significant unfunded mandates on local governments. Knowing the Act would be subject to a point of order on the Floor that would highlight the mandates issue, the Committee worked with us and local governments to address their concerns.
The process worked. Without it, the Committee was poised to go forward with provisions that would have imposed significant costs on municipalities.
In other cases, such as the minimum wage increase, the point of order was raised on the floor, forcing a debate over the mandate and the significant costs imposed on the public and private sectors. But the point of order failed, and the legislation was passed, notwithstanding the mandate. We went through the same process on the Yucca Mountain bill - and decided to proceed.
The point is simple -- UMRA has given state and local governments a valuable tool to get mandates issues considered and addressed at the committee level before they reach the floor - and, if that fails, to force a debate on the floor. But it is also flexible enough to permit the Congress to pass legislation imposing unfunded mandates when the merits of the bill override the negative impact of the mandates.
Unfortunately, due to the political realities of passing such precedent setting legislation 3½ years ago, we were unable to offer the same procedural protections for private sector mandates that we could offer the public sector. I commend Congressman Gary Condit and Senator Spence Abraham, who is leading this effort in the other body, for the hard work they have put into the bill before you this afternoon to take the next logical step and offer, not all -- but similar -- protections for the private sector.
I also want to thank Representatives Tom Davis and Jim Moran who made an excellent point about privatization, for their support of H.R. 350 - and commend them for their hard work to ensure that the previous legislation, UMRA, works better. Their amendment, which we have incorporated in H.R. 350 this year, makes clear that State and Local governments could be given new or expanded authority to meet the programmatic responsibilities if additional costs were imposed on them through entitlements reform. We also worked closely with the leading national organizations representing state and local governments on this provision, and appreciate their support.
I want to take a minute to review how these procedures work in the House. Just as is the case with UMRA, any Member can raise a point of order against legislation that imposes an unfunded mandate -- this time on the private sector.
This results in a 20 minute debate on the question of whether the House should continue to consider the legislation, notwithstanding an unfunded mandate on the private sector. And again, much more importantly, we believe the possibility of this floor vote means that Committees will do their best to minimize new mandates.
This process of debate and vote is a far more significant tool, as UMRA has already proven with public sector mandates, than simply requiring committees to include a CBO estimate in the committee report, which the UMRA already does with respect to private sector mandates. In fact, on Tuesday, CBO testified that since UMRA was enacted "demand and supply for information about the costs of federal mandates has increased," and "in many instances CBO has been able to provide informal guidance on how the proposal might be restructured to eliminate the mandate or reduce its costs." That's something we're not doing currently with respect to the private sector because there is currently no incentive to address the mandates before they reach the Floor. This legislation creates that incentive.
If the Rule waives the mandates point of order, a Member can raise a point of order against the Rule and highlight the mandates issue, with a 20 minute debate. The House votes and that's it -- the rule can pass and the bill moves forward without the ability to raise the mandates question again with a point of order on the bill.
There are a few differences between UMRA and this private sector mandates bill -- each put in place with the encouragement of the Rules Committee to ensure that the bill does not cause unnecessary delays or other procedural problems on the Floor.
First, recognizing that there are likely to be more private sector mandates, the threshold is raised. Under UMRA, a Member can raise a point of order against a provision in the bill that imposes a public sector mandate in excess of a $50 million threshold nationwide. This bill would double that threshold, applying to bills that impose a private sector mandate in excess of $100 million.
Second, in order to address the concern that the point of order could be used as a dilatory tactic, it only permits one point of order against the underlying legislation, forcing consolidation.
Third, the bill exempts legislation that results in a net tax decrease. This provision, known last year as the Dreier Amendment, may come down to a philosophical debate in some regards as to tax versus spend, but let me explain why we think it makes sense.
Because taxes impose an enforceable duty, they constitute a form of mandate, generally an unfunded mandate, and -- as a recent Congressional Research Service report points out -- taxes are generally private sector mandates, because the federal government does not tax other governments. Under our budget rules in the House, tax relief can really only come about through mandating, in the sense that we have to come up with tax increases somewhere else. The other choice is to offset tax cuts with decreases in mandatory spending, which has not been popular.
If we want tax relief, say the capital gains relief we passed last Congress, we must find "tax loopholes" to close. Those loophole closers are new mandates. It seems illogical to me to say every time we want to give any kind of net tax relief we have to mandate, then subject such bills to this process that is set up to discourage mandates.
Mr. Chairman, there will be a healthy debate as this Committee moves forward, as was the case last year, on various amendments and interpretations of the bill. There were debates about the impact this legislation might have on labor laws, environmental laws, and health standards. The answer to these concerns is simple, and I want to be very clear about this -- all this bill says is that we in the House should have a debate on the new unfunded mandates. If, in the end, a majority in Congress supports the legislation notwithstanding the mandate, then - just as in the recent cases of the minimum wage and the Yucca Mountain bill - the legislation passes.
We've heard this morning from our colleague from New York [Mr. Boehlert], a leader on environmental issues. He believes that creating this additional point of order for private sector mandates will necessarily limit the time of debate to 20 minutes on significant legislation, such as - using his examples s - the Clean Water Act and the Patients Bill of Rights.
The answer to this is simple - it theoretically could, but only if a proper point of order is raised and then only if a majority of Members decide to limit debate.
The alternative - not holding out the possibility of such a debate and vote - guts the bill and the intent to shine the light on mandates and force accountability - one way or the other.
Remember, this bill is all about accountability. The intent of the vote is to hold us accountable for our actions. It's about accountability to consumers, small businesses and workers who are directly impacted by the vote to impose the mandate -- but it's also about accountability to other affected constituents -- like local environmentalists, patients or others for voting to send legislation that is important to them - such as the Clean Water Act or the Patient's Bill of Rights -- back to Committee.
It's also about information. If enacted, CBO will provide Members with more specific information on the impact a proposed private sector mandate would have on consumers, workers and small businesses. It allows Members who remain undecided on the pending legislation to be more informed.
The bottom line is -- this legislation provides additional, more specific, information, not only to the members voting on the issue, but also to the voters to whom the members are ultimately accountable.
Again, Mr. Chairman, this bill will not end private sector mandates, just as the Unfunded Mandates Reform Act has not ended public sector mandates. The minimum wage increase is one example of a bill that imposed significant costs on the public and private sectors, and the mandates point of order was roundly defeated. Congress still has the ability to impose mandates on the public and private sectors, but UMRA and now this bill will force Congress to make a stronger case on the merits and seriously consider the effects on consumers, workers, small businesses. It requires us to work cooperatively with the private sector to accomplish our public policies in the most cost effective manner.
I appreciate all the cooperation and assistance we have received from the Rules Committee Members and staff -- and from the Chairman in particular -- over the last several years during consideration and implementation UMRA and this bill.
It's a good bill - it's all about increasing Congressional accountability - and I urge my colleagues to pass it.
