$1T spending deal averts government shutdown 

Source: Nick Juliano, Manuel Quiñones and Annie Snider, E&E reporters • Posted: Wednesday, December 10, 2014

Congressional appropriators last night unveiled a $1 trillion spending bill to fund most government agencies through the end of the year, making slight cuts to U.S. EPA while boosting spending at the Departments of Energy and the Interior.

The fiscal 2015 spending bill, posted just after 8 p.m. yesterday, will be considered this afternoon by the Rules Committee, which will set up a House vote tomorrow. It remains to be seen whether the Senate also will be able to reach an agreement to vote on it tomorrow in order to prevent the government from shutting down, but aides expected that a shutdown would be avoided, via quick passage of the mammoth spending bill or a one- or two-day continuing resolution, if necessary.

“After months of thorough, business-like, sometimes tough but always civil negotiations, we have reached a responsible, bipartisan and bicameral agreement on funding for government operations for 2015,” House Appropriations Chairman Hal Rogers (R-Ky.) and Senate Appropriations Chairwoman Barbara Mikulski (D-Md.) said in a joint statement last night. “More than two months into the fiscal year, it’s time we end government on autopilot so we can turn our focus to meeting the day to day needs of Americans and long-range needs of the nation.”

Informally dubbed the “CRomnibus,” the bill combines an omnibus appropriations bill for most agencies and a CR for the Department of Homeland Security through February so Republicans can continue to pressure President Obama over his recently announced executive order on immigration.

As anticipated, the bill steers clear of new limits on major U.S. EPA rules related to climate change and water regulation, although the agency would see its budget cut (see related story). But it does create an environmental flashpoint by limiting the Fish and Wildlife Service from completing its work to determine whether the sage grouse should be listed as endangered (see related story).


Of the three main energy and environmental policymaking agencies, only DOE would see a budget increase. Its energy programs would grow $22 million to $10.2 billion next year, with increases across its most significant offices. The Office of Energy Efficiency and Renewable Energy’s budget authority would grow nearly $25 million compared to fiscal 2014, to $1.93 billion for this fiscal year; Nuclear Energy would receive $914 million, a $24 million increase from last year; and Fossil Energy would add nearly $9 million, securing $571 million in the bill.

DOE’s administration account, which covers salaries and other expenses, would grow more than $10 million, to $245 million.

Funding for DOE’s Office of Science would remain flat at $5 billion, as would funding for the Advanced Research Projects Agency-Energy, which stays at $280 million.

Cuts at DOE would come to the loan guarantee program, which would see its appropriated funding drop from $20 million to $17 million, and the Advanced Vehicle Technology Manufacturing loan guarantee program, which would lose a third of its budget compared to last year, dropping to $4 million.

The spending bill also includes language barring DOE, which is also responsible for the nation’s nuclear weapons stockpile, from entering into new contracts with the Russian government or from providing new federal assistance to Russia, which has been widely criticized by Western governments for its annexation of the Crimean Peninsula and hostilities with Ukraine throughout the year.

Also carried over in the bill is an existing ban on enforcing light-bulb efficiency standards that has been in place for years.

The proposal also includes $54.5 million in funding for the licensing of small modular reactors, a pot of money stemming from DOE’s five-year program consisting of $452 million cost-share funds. The 2015 fiscal funds, according to DOE, would support the licensing of the agency’s second award for an SMR developer.

Development of the small units — 300 megawatts or less — is seen as key to revitalizing an industry that has been hampered by stiff competition from cheap natural gas, a lack of carbon controls and waning demand for electricity in some parts of the country. Critics, however, have raised concerns about costs and unknowns related to building the units.

report accompanying the bill further details how appropriators would like DOE to spend the money it receives. The report directs DOE to complete a years-overdue report on the Strategic Petroleum Reserve’s effects on the domestic petroleum market, and the bill also requires that Congress be notified if DOE conducts any more test sales of SPR crude, as it did earlier this year.

Appropriators also request a report on how DOE will implement recent recommendations from the Government Accountability Office to overcome shortcomings in the management of its loan guarantee program.

“In particular, the speed at which the loan program is finalizing the actions taken to address the deficiencies in the program’s administration is unsatisfactory,” appropriators write. “Concerns persist about the continued lack of comprehensive policies for oversight and monitoring risk of existing loan guarantees.”

The CRomnibus does not include a rider that was added to an earlier DOE-funding bill passed by the House, which would have barred finalization of a $150 million loan guarantee for the Cape Wind project offshore Massachusetts. But the report does require DOE to provide a report within 30 days, along with quarterly updates, on “status of the Cape Wind conditional commitment, including an update on ongoing litigation and the risks this litigation poses to the success of the project.”

The bill also includes language ensuring that DOE’s work in the area of hydraulic fracturing provides benefits to both the oil and gas industry as well as the public at large.

“Any funding in the area of hydraulic fracturing, including funding to support the proposed joint effort with the Environmental Protection Agency (EPA) and the United States Geological Survey (USGS), is for research into hydraulic fracturing technologies that aims both to improve the economics and recoverability of reserves and to address the health, safety, and environmental risks of shale gas extraction,” the report notes.


U.S. EPA would be funded at $8.1 billion in fiscal 2015 under the spending bill, $60 million less than EPA received in fiscal 2014. It’s also $250 million more than the Obama administration asked for in its 2015 budget request.

The spending deal would fund EPA’s popular Clean Water and Safe Drinking Water state revolving funds at $2.35 billion, level with 2014 funding and nearly $600 million above the president’s request.

House Republicans touted several provisions in the bill to “rein in regulatory overreach,” but the bill largely sidestepped hot-button riders taking aim at some of EPA’s most controversial air and water regulations (see related story).


The bill would provide $10.7 billion for the Interior Department, down from Obama’s $10.9 billion request but slightly above the $10.5 billion in current funding.

In a major blow for wildlife advocates, the bill contains a controversial rider prohibiting the Fish and Wildlife Service from issuing proposed or final Endangered Species Act listing rules for four sage grouse species, including the greater sage grouse, which roams 11 states (see related story). If passed, it would be the most controversial wildlife rider enacted by Congress since April 2011, when it legislatively delisted the gray wolf in Idaho and Montana.

The bill would provide no funding for Secure Rural Schools, a significant setback for forested counties in the West that depend on the program to cushion a major decline in federal timber harvests. House leaders intend to find funding for the program early next year while pushing legislation to streamline timber sales, a move sure to ignite major policy battles with the White House.

The bill also would deny Obama’s request to overhaul federal wildfire funding, a major defeat for conservationists, sportsmen, loggers and other forest users. Obama’s wildfire disaster funding proposal, which was backed by the Senate Appropriations Committee but opposed by House budget hawks, sought to prevent the Forest Service from having to siphon money from forest stewardship programs to fight wildfires (see related story).

Water rider

Congressional Republicans will have to wait until next year to try to block the Obama administration’s controversial water proposal, though they won compromise language in the spending bill relating to how the rule could affect farmers and ranchers.

Congressional leaders landed on language that would prevent EPA or the Army Corps of Engineers from requiring a permit for normal farming practices or ditch maintenance — exemptions currently spelled out under the Clean Water Act.

Whether that language would simply underscore the existing exemption or would broaden it is a point of debate, though.

One question being raised by environmentalists is whether the language would affect the Clean Water Act’s recapture provision, which allows regulation of practices that would otherwise be exempt under the law if they fundamentally change a water body.

Another question is whether it could open the door to real estate developers and others attempting to claim agricultural exemptions for activities that are ultimately aimed at something other than farming or ranching.

Jan Goldman-Carter, senior manager for wetlands and water resources at the National Wildlife Federation, said that the language, at a minimum, would add another layer of uncertainty to an already muddled regulatory process.

“In a year where we’ve had the drinking water supplies of three major cities shut down due to contamination — two of them where nutrient pollution from agriculture was a significant contributing factor — to be addressing these major, important clean water policies through a last-minute appropriations rider just seems to be very misguided,” she said.

But agricultural groups, which have argued that the administration’s proposed Waters of the U.S. rule would end up shrinking the statutory exemptions for their work, see the CRomnibus language as a good first step to addressing their worries.

“This is a start — more heavy lifting to do to stop the blatant regulatory over-reach of the [Waters of the U.S.] proposal,” Don Parrish, senior director of regulatory relations for the American Farm Bureau Federation, said by email last night.

The bill would also kill a roundly criticized interpretive rule for agriculture.

Few tears are likely to be shed over that move. Both supporters and opponents of the overall water rule saw flaws in the document that the administration said was intended to spell out conservation practices that farmers could undertake without worrying about whether they need a Clean Water Act permit (Greenwire, July 9).

On a swing through Missouri farm country this summer, EPA Administrator Gina McCarthy acknowledged that the interpretive rule had “fallen totally flat on its face” and opened the door to potentially withdrawing it (E&ENews PM, July 10).

Army Corps

The spending measure would provide $5.5 billion to the Army Corps of Engineers — a modest increase of $15 million over fiscal 2014 levels for the cash-strapped agency, which is tasked with building and maintaining the country’s system of locks, dams, levees and ecosystem restoration projects.

Appropriators took steps in the bill to follow through with funding agreements laid out in the Water Resources Reform and Development Act passed earlier this year relating to spending from two industry-funded trust funds to support harbor deepening and lock and dam projects.

But new projects authorized in WRRDA see little funding in the measure, since funding decisions were largely set before passage of the bill, appropriators said in an explanatory document accompanying the spending bill.

They also expressed concerns about some of the process reforms instituted by the WRRDA bill. For instance, the law aims to speed up the long process for moving levee, lock, dam or ecosystem projects from conception to authorization by compressing the study process. Appropriators say now, though, that this could just shift the process rather than truly accelerate it.

In addition to the waters of the U.S. policy rider, the measure weighs in yet again on a long-running battle over an effort to update 30-year-old guidelines for funding federal water projects. The new guidelines, called “principles and requirements,” were released by the Obama administration in March 2013 and are intended to place greater weight on environmental considerations when planning major water projects.

But opponents have feared they would divert too much federal cash to ecosystem restoration and nonstructural projects at the expense of levees and other infrastructure, and Congress blocked the corps from implementing them (Greenwire, March 26).

In the explanatory document released with the CRomnibus last night, appropriators said “concerns persist” about the process and again blocked the use of funds for the corps to participate in their development or implementation.

Western drought

Last-ditch efforts by California Republicans representing the state’s parched agricultural valley to pass a short-term drought relief measure this week failed to earn a place in the spending measure — their best hope of action on the issue before the end of the year (E&ENews PM, Dec. 9).

The measure does provide $50 million for Western drought response, to be directed to the most direct and immediate work that can be done to extend water supplies.

“Drought conditions are difficult to address at the time the drought is occurring, but there are some things that can be done to stretch available water supplies,” appropriators said, suggesting moving water from states with plenty to states without, and working with water districts to improve efficiency.

The measure also meets the president’s budget request for the WaterSMART program, the Bureau of Reclamation’s program aimed at addressing the growing gap between supply of and demand for water supplies in the West. The funds include $19 million for grants, often aimed at improving how efficiently farmers and communities move and use water.

Overall, the budget would provide a slight increase to the Interior Department’s water programs, including Reclamation, bringing its budget to $1.1 billion.


The National Oceanic and Atmospheric Administration would get about $5.4 billion under the agreement, close to the spending bill that passed the Senate Appropriations Committee earlier this year. That is an increase of about $126 million from the fiscal 2014 enacted level, or $20 million more than the Senate bill, according to a summary of the omnibus.

In a win for ocean advocates, the omnibus does not include a provision from the House bill that aimed to bar the administration from implementing a National Ocean Policy. But there are no funds for the policy in the bill, as none were requested.

Of the $5.4 billion, almost $1.9 billion would go to fully fund the agency’s two major satellite programs, which the agency is striving to keep on track to avoid a gap in some weather data.

Lawmakers have added language to emphasize that NOAA should take “aggressive steps to address the fragility” of one of the programs — the Joint Polar Satellite System — which only recently got back on track after years of delays and budget overruns (Greenwire, July 14). The bill also asks the agency to report quarterly to Congress on its implementation of recommendations from a recent inspector general report that found weather satellites could be hacked (Greenwire, July 28).

On the so-called wet side of NOAA, the National Ocean Service would get about $481 million, including the agency’s requested amount for coastal zone management grants. The National Marine Fisheries Service would get about $822 million.

Coal and mining

The spending bill would continue several coal and mining-related policy riders, including a prohibition on the administration changing the definition of fill material. Such a step, while not in the administration’s public plans, could make it tougher for strip coal and hardrock mining.

House Appropriations Chairman Rogers has been a champion of the fill definition rider, plus a related policy directive meant to speed up Clean Water Act Section 404 dredge-and-fill permits for coal mines and keep lawmakers apprised of their status.

A third coal-related rider would roll back new policies by the the U.S. Export-Import Bank and the Overseas Private Investment Corp. meant to limit funding for power plant projects overseas.

The spending bill would fund the Office of Surface Mining, Reclamation and Enforcement, including the Abandoned Mine Reclamation Fund, at roughly $150 million, a number comparable to current levels.

The legislation would also give OSMRE almost $70 million for state grants. It’s an effort by lawmakers to block an agency effort to cut grants and have states make up the difference by raising regulatory fees.

“It is imperative that States continue to operate protective regulatory programs as delegation of authority to the States is the cornerstone of the surface mining regulatory program,” said a summary. “Further, the agreement does not provide funds to expand and enhance Federal oversight activities of State programs.”

The United Mine Workers of America union has been lobbying for legislation to shore up its benefits program, which gets some interest dollars from the industry-funded Abandoned Mine Lands Fund. The spending bill encourages the administration to propose solutions if Congress doesn’t act.

When it comes to the Mine Safety and Health Administration, the spending bill would give the agency $375.9 million, comparable to current levels.


Overall funding for transportation programs would remain largely flat. The Transportation Department would get $17.8 billion in discretionary money, equal to last year’s total, but $4.8 billion below the White House’s request. Highway funding would stay at its annual authorized level of almost $41 billion, transit funding at $8.6 billion. The Federal Transit Administration’s budget would grow almost 7 percent to $2.3 billion.

However, the popular TIGER (short for Transportation Investment Generating Economic Recovery) grant program would be cut from $600 million to $500 million, less than the Senate Appropriations Committee had wanted but far more than the $100 million than the House had approved in its version of the bill earlier in the year.

Federal subsidies for Amtrak operating expenses would also be sliced from $340 million to $250 million. The passenger railroad last month reported that it had not needed all of its 2014 appropriation to cover losses, as revenue hit a record and expenses were kept in check. But the agreement reverses a House bid to cut funding for Amtrak’s capital budget and debt service by almost 20 percent. Instead, that account would grow some 9 percent to $1.14 billion.

As was true in 2014, the bill contains no money for high-speed rail projects, but the deal also rejects an attempt by Rep. Jeff Denham (R-Calif.) to suspend the use of previously allocated federal funds for California’s planned bullet train system.

On the crude-by-rail front, the Transportation Department would have to wrap up work on DOT-111 tank car design regulations by mid-January. The agreement also orders the Pipeline and Hazardous Materials Safety Administration to come up with new approaches for the siting, design and construction of “small-scale” plants that package liquefied natural gas “as a transportation fuel for domestic delivery via non-pipeline means.” Not included in the bill is funding for a national pipeline information exchange.