Washington Snapshot: New IRS Chief, Government Reopens After Brief Shutdown

In This Week's Edition of Snapshot:

• After three-day shutdown, government reopens; Congress continues to grapple with immigration
• Chuck Rettig tapped to be new IRS Commissioner
• Senate confirms Jerome Powell as new Federal Reserve Chair
• In the States: States consider Medicaid work requirement

News from the Hill

After Three-Day Shutdown, Government Reopens; Congress Continues to Grapple with Immigration

After much behind-the-scenes debate and seemingly hardening positions on both sides of the aisle in the Senate, 32 Senate Democrats and one Independent joined with their Republican colleagues and “voted to reopen the government on Monday after receiving a commitment from Republicans to hold a vote on immigration legislation—paving the way to end the three-day shutdown,” according to POLITICO. With a vote of 81-18 (Sen. John McCain was absent due to health reasons), the Senate passed a bill which funded the government through Feb. 8, allowing Congress more time to come to a compromise on immigration. POLITICO also noted, “If a broader deal is not reached by Feb. 8, the Senate would take up legislation to protect hundreds of thousands of young undocumented immigrants who are losing legal protections, as long as the government remains open.”

The funding deal—which passed the House on Monday and was subsequently signed by President Donald Trump—also reauthorized the Children’s Health Insurance Program (CHIP) for six years (something Democrats have been urging Congress to reauthorize since it expired last year) and delayed two Obamacare-related taxes that had yet to go into effect. According the POLITICO’s Health Care Whiteboard, “[The deal] would also delay Obamacare’s medical device and Cadillac taxes for two years and its health insurance tax for one year. The Cadillac tax on costly workplace health plans, which was previously delayed by Congress, would now go into effect in 2022. The medical device tax had previously been suspended before it took effect again this month.”

With three weeks until government funding runs out again, Congress has a tight deadline to come up with and pass an immigration plan. Furthermore, negotiators seem to be further apart now than they were this weekend. According to The New York Times, “Senate negotiators found themselves back at Square 1 on immigration on Tuesday, as the Senate Democratic leader withdrew the biggest gesture he had made to strike a deal: an offer to fully fund President Trump’s proposed wall at the Mexican border. ‘The wall offer’s off the table,’ the leader, Senator Chuck Schumer of New York, told reporters at the Capitol a day after senators overcame an impasse to end a three-day government shutdown.

Mr. Schumer’s decision to renege, made on Sunday but revealed publicly on Tuesday, marked another turn in the fluid debate over how to shield from deportation hundreds of thousands of young immigrants brought to the country illegally as children.”

Executive & Regulatory News

Chuck Rettig Tapped to be New IRS Commissioner

President Donald Trump is expected to nominate Charles “Chuck” Rettig to become the new Commissioner of the IRS. Rettig will replace Assistant Treasury Secretary for Tax Policy David Kautter—who has served as Acting Commissioner since former IRS Commissioner John Koskinen stepped down at the end of his term last November.

Rettig, a tax attorney with more than 30 years of experience in litigation, will take the reins of the agency as it undertakes the important process of implementing the new tax legislation.

Senate Confirms Jerome Powell as New Federal Reserve Chair

On Tuesday, the Senate confirmed Jerome Powell to become the new Chair of the Federal Reserve by a vote of 84-13. Powell will replace Janet Yellen, who served under President Barack Obama and was the first woman to hold the position.

Powell was formerly a partner at the private equity firm, The Carlyle Group, and has generated some buzz due to his being the first person in nearly 40 years to chair the Federal Reserve without an advanced degree in economics.

Happening in the States

Exclusive from our colleagues at the National Council of Nonprofits.

States Consider Medicaid Work Requirement

The Trump Administration issued guidance this month expressing a willingness to allow states to impose a work requirement as a condition of eligibility for state Medicaid programs. Kentucky received the first waiver, and nine more states (Arizona, Arkansas, Indiana, Kansas, Maine, New Hampshire, North Carolina, Utah, and Wisconsin) are awaiting approval of their pending Medicaid waivers that include a work requirement.

The Kentucky program will apply to able-bodied adults between 19 and 64 who are not pregnant, attending school, former foster care youth, or primary caregivers. It requires 80 hours per month of “community engagement,” including working, attending school or vocational courses, or performing community service, such as volunteer service. Recognizing the controversial nature of the new mandate and the likelihood of court challenge, Kentucky Governor Matt Bevin has already signed a preemptive executive order directing termination of Medicaid to more than 400,000 persons should the work requirement or other provision be successfully challenged in court.

The National Human Services Assembly recently expressed concerns about imposing a work mandate as a condition of Medicaid eligibility: “Evidence suggests that mandatory work requirements would undermine the health and well-being of our country by making it harder for people to access timely physical and mental health services. That’s because any recipient who becomes subject to new work requirements but cannot meet them would be at risk of losing coverage. Even those eligible under the new requirements would face new hurdles to establishing their eligibility, which could result in delayed coverage or the loss of coverage.”

The National Council of Nonprofits has long opposed the inclusion of volunteerism as a component of a work requirement, calling it “mandatory volunteerism.” The requirement exposes charitable nonprofits to significant new costs by having thousands of individuals in a state suddenly contacting nonprofits or foundations (especially “name brand” organizations) and expecting “volunteer” placements. Moreover, the requirement demeans true volunteerism by creating a stigma that falsely equates volunteering with nonprofits as a “community service” obligation typically meted out to lawbreakers.