Plurus Outlook: Approaching 2024

Outlook for 2024

Congress is home for the holidays. The Senate had extended its DC work period by three days to continue negotiations aimed at producing a border deal to unlock Ukraine aid and other supplemental national security spending. With no framework secured, the chamber recessed on December 20. The House adjourned for the holidays the week before.

Capitol Hill already has a big to-do list for 2024. House Speaker Mike Johnson (R-LA) will have to continue to navigate a challenging caucus and must confront the reality that lack of consensus among Republicans on Ukraine funding, impeachment inquiries, expulsions from the House, and more cost precious floor time needed to deliver on 2023 legislative priorities. As we look ahead to November, conventional wisdom is that the 60-vote threshold for moving legislation through the Senate will become a higher bar to clear. Through this lens, we have identified the top legislative priorities that have been punted to 2024, along with a few key issues where there is bipartisan interest in continuing work next year.

Policy debates aside, 2024 electoral politics will also shape the legislative environment. This cycle is already fraught with control of both chambers in play depending on the outcome of several tight House and Senate races, not to mention the high likelihood of a rematch of the 2020 presidential election. That said, we should expect an uptick in regulatory action in the months ahead, as evidenced by the Biden Administration’s aggressive regulatory agenda.

In particular, the Biden Administration has signaled that it will be prioritizing the implementation of the Inflation Reduction Act (IRA), the Infrastructure Investment and Jobs Act (IIJA), and the CHIPS and Science Act. The Administration is also pushing agencies to finalize proposed rulemakings as soon as possible to minimize the chance they are overturned by a Congressional Review Act (CRA) vote should there be a change in the Administration.

2024 Major Expiration Dates

As of December 21, Plurus is tracking the following 2024 major expiration dates:

• January 19: Continuing Resolution (CR) for Agriculture-Food and Drug Administration

  (FDA); Energy and Water; Military Construction and Veterans Affairs (MilCon-VA); and

  Transportation, Housing, and Urban Development (THUD)

  • January 19: Pandemic and All Hazards Preparedness Act (PAHPA) Authorization for

  Certain Programs

  • February 2: CR for Commerce, Justice, and Science (CJS); Defense; Financial Services and

  General Government (FSGG); Homeland Security; Interior and Environment; Labor,

  Health and Human Services, and Education (Labor-HHS); Legislative Branch; and State

  and Foreign Ops (SFOPs)

  • February 2: National Flood Insurance Program (NFIP) Authorization

  • March 8: FAA Authorization Expiration (see above)

  • April 19: Foreign Intelligence Surveillance Act (FISA) Section 702 Authority

  • May 1: CR Penalty under the Fiscal Responsibility Act (Debt Ceiling Deal)

  • September 30: Farm Bill Authorization

  • September 30: End of Fiscal Year 2024 (FY24)

  • December 31: National Defense Authorization Act (NDAA) Deadline

  • December 31: Several provisions in the Water Resources Development Act (WRDA)

Additionally, we continue to monitor key authorizations that have already expired, such as:

• March 9, 2023: Federal Communications Commission (FCC) Spectrum Auction Authority

• September 30, 2023: National Quantum Initiative Act Authorization

• September 30, 2023: Substance Use Disorder Prevention that Promotes Opioid Recovery and Treatment for Patients and Communities (SUPPORT) Act Authorization

2023 Legislation Pushed to the First Quarter of 2024

Ukraine-Israel-Taiwan-Border Package/Supplemental

Although Speaker Johnson indicated the House would not return to vote on any deal before next year, Senate Majority Leader Chuck Schumer (D-NY) extended the work period to continue negotiations on the border component that Republicans have demanded be included in a national security supplemental. However, after three days of session, the chamber recessed for the holidays with no deal in hand. President Joe Biden’s original supplemental request would provide $61 billion for Ukraine, $14.3 billion for Israel, $2 billion for Taiwan’s security needs, and about $9 billion for global humanitarian aid. In recent days, and in conjunction with a visit from Ukrainian President Volodymyr Zelensky, the administration has warned that resources are dwindling for additional security drawdowns in support of Ukraine. Our instincts are that there will be a supplemental package in January, so long as Republicans are serious about more aid for U.S. allies and potentially willing to give up immigration as a top issue to differentiate themselves from President Biden and Democrats.

FY24 Appropriations

In late September, Congress passed a CR funding the government through November 17. With minimal momentum in spending talks, on November 15, Congress passed a bifurcated CR to keep the government open. Funding for programs in the Agriculture-FDA, Energy-Water, MilCon-VA, and THUD bills will expire January 19, while funding for the CJS, Defense, FSGG, Homeland Security, Interior-Environment, Labor-HHS, Legislative Branch, and SFOPs bills will continue until February 2. Little progress has been made in recent days on topline numbers, resulting in Speaker Johnson suggesting that we could be looking at a year-long CR. Of course, should Congress fail to pass FY24 appropriations bills, then both defense and non-defense spending would be subject to the one percent cut on May 1 required by the debt ceiling agreement.

Tax Package

As we near the end of the year, there have been reports of positive engagement between the Senate Finance Committee, the House Ways and Means Committee, and Congressional leadership on a potential tax package. Current thinking is that such a vehicle could include provisions supported by both parties. For example, Democrats want to extend the Child Tax Credit (CTC), which Republicans may be willing to accept in exchange for pro-business provisions, such as bonus deprecation and the business research and development tax credit. If 4 a tax package comes together, it could ride on an FY24 appropriations measure. It is also worth noting that several of President Donald Trump’s corporate tax policies are set to expire in 2025, creating another opportunity to address current tax policy.

Comprehensive Healthcare Package

Although it typically pursues a end of year healthcare package, Congress is looking towards a “beginning of year” effort that could ride on a January 19 or February 2 government funding package. In addition to addressing already expired or soon to expire healthcare programs, like PAHPA and the SUPPORT Act, Congress may have the opportunity to advance another comprehensive healthcare package. Last week, the House passed the Lower Costs, More Transparency Act (H.R. 5378) by a vote of 320-71. This package of House Education and Workforce, Energy and Commerce, and Ways and Means Committee priorities includes provisions that fund community centers, renew federal health programs, enact site-neutral drug payment requirements, and enforce transparency among pharmacy benefit managers (PBMs) and providers. Work in the Senate has been more siloed, with the Senate, the Health, Education, Labor, and Pensions (HELP) Committee and Senate Finance Committee pushing their own proposals.

FAA Reauthorization

The House passed its five-year FAA authorization by a vote of 351-69 this summer. Despite hope earlier December that the Senate Commerce Committee would markup its FAA bill after a breakthrough on pilot training hours, committee action never materialized. However, before each chamber recessed for the holidays, Congress passed a short-term extension to March 8.

Reauthorization of FISA Section 702

Section 702 of FISA, which authorizes the federal government to access and gather communications data on non-American citizens for intelligence purposes, was extended until April 19 under a provision in the recently enacted FY24 NDAA. The House was set to vote on competing House Judiciary and House Intelligence Committee FISA proposals last week, but ultimately the votes were scrapped. Meanwhile, the Senate Intelligence Committee has put forward bipartisan Section 702 reform legislation, which could be a starting point for negotiations as we approach the April deadline.

Other 2024 Bipartisan Legislative Priorities

• Farm Bill: Amid disagreements on funding for critical welfare programs, Congress extended the 2018 Farm Bill until September 2024, buying Members time to continue negotiations. While there are still disagreements on topline funding levels, the GOP continues to support traditional price support measures and other Farm Bill programs that would serve rural parts of the country. Democrats strive to ensure the next Farm Bill prevents further cuts to the Supplemental Nutrition Assistance Program (SNAP), while also preserving agricultural climate-based solutions funding included in the IRA.

• Artificial Intelligence (AI): Through numerous hearings, bills, and working groups, nearly every Congressional committee has been working towards comprehensive AI legislation to promote innovation while instituting appropriate guardrails. While Congressional sources agree that action on big legislation to require AI regulation may not come to fruition until the 119th Congress, it remains possible that narrower AI bills advance next year, potentially including legislation to address concerns about misinformation and disinformation in the upcoming elections.

• Data Privacy: It is increasingly being suggested that AI and data privacy could be tackled together. While the House Energy and Commerce Committee marked up the American Data Privacy and Protection Act (ADPPA) in the 117th Congress, the bill has yet to be reintroduced. Given how difficult it has been for privacy legislation to overcome obstacles such as disagreement over preemption and private right of action, it is unclear if there is a path forward for comprehensive privacy legislation in this Congress. In the meantime, there are rumors about legislation related to kids’ online privacy, such as the Kids Online Safety Act (KOSA) and the Children and Teens Online Privacy Protection Act (COPPA 2.0), possibly getting a vote next year.

• FCC Spectrum Reauthorization: Unable to overcome an impasse on a spectrum pipeline, Congress allowed the FCC’s spectrum auction authority to lapse back in March. Both the House and Senate have now passed the 5G SALE Act, which temporarily grants the FCC the authority to issue licenses won in previous auctions. There is bipartisan interest in restoring the FCC’s ability to conduct spectrum auctions, especially because they generate revenue to pay for other priorities. However, longstanding disagreement between the Department of Defense (DoD) and commercial spectrum users, particularly regarding use of the lower 3 GHz airwaves, continues to preclude progress on a deal.

• Permitting Reform: Both sides of the aisle remain frustrated with the current process for permitting energy and infrastructure projects. Democrats want to continue implementing clean energy projects and climate-oriented programs launched in the IRA and the IIJA. Simultaneously, the GOP desires to promote natural gas through the construction of pipelines. With permitting reform’s champion Sen. Joe Manchin (D-WV) now having announced he is not running for reelection, there could be a window to advance permitting reform next year.

• Taiwan Tax Legislation: As Taiwan remains the only top U.S. trading partner without an agreement to address double taxation, there has been an increased bipartisan and bicameral appetite to advance legislation to provide double taxation relief. The issue has risen on the priority list as the U.S. aims to attract Taiwanese semiconductor investment and strengthen its overall relationship with Taiwan. The Senate Finance Committee passed the U.S.-Taiwan Expedited Double-Tax Relief in September and the House Ways and Means Committee followed suit earlier in December. The bill is a candidate to ride on a larger legislative vehicle in early 2024.

• Water Resources Development Act (WRDA): Congress typically passes a new WRDA bill, which authorizes programs and funding for critical water programs across the country for ports, harbors, water resources, water infrastructure, coastal protections, every two years. Most WRDA provisions do not expire, but because the length of some WRDA programs is limited, and since the most recent WRDA bill was enacted in December 2022, WRDA 2024 could become law before the end of next year. In fact, the Senate Environment and Public Works (EPW) Committee and the House Transportation and Infrastructure Committee have already held hearings to inform work on the 2024 bill.

Partisan Priorities for Messaging on the Campaign Trail

History tells us that the legislative agenda in an election year will focus nearly exclusively on must-pass bills and bipartisan priorities. While there may not be meaningful action in Washington, we should also expect ongoing rhetoric and messaging efforts on partisan priorities. Rather than in the halls of Congress, these issues are most likely to pop up on the campaign trail.

For example, Democrats will likely highlight ongoing efforts to protect abortion and other reproductive healthcare rights, bolster voter protections, and secure a path to citizenship for long-standing undocumented migrants and Dreamers. For the GOP, messaging focused on securing the border and cracking down on crime will likely continue. Other GOP priorities might 7 include continuing investigations into President Biden and his son, Hunter Biden, and impeachment inquiries targeting the President and potentially other Biden Administration officials.