Finance Committee chief Max BaucusMax BaucusFive reasons why Tillerson is likely to get through Business groups express support for Branstad nomination The mysterious sealed opioid report fuels speculation MORE (D-Mont.) is unlikely to follow the example of three other chairmen who have imposed voluntary earmark-disclosure rules on their members’ requests.
According to a Baucus aide, Baucus does not anticipate sending an earmark letter because the Finance Committee’s informal rule against so-called “rifle-shot” tax benefits makes the panel a special case.
Initially, Sen. Jim DeMint (R-S.C.) had called for an immediate Senate rules change to implement earmark standards approved earlier this year. To preempt that move, the three chairman sent letters to their panels’ members calling for voluntary earmark disclosure instead.
As the aide argued, tax provisions are distinct from appropriations.
“For 20 years the [Finance] Committee has had an anti-rifle shot rule enforced by committee chairmen, prohibiting provisions that apply to one taxpayer,” the aide said. “Chairman Baucus will continue to enforce this rule and supports the provision in [the Senate ethics bill] that would require disclosure of provisions with limited tax benefits.”
The rifle-shot rule, as former Finance Chairman Chuck GrassleyChuck GrassleyAngst in GOP over Trump's trade agenda Flynn told FBI he didn't talk sanctions with Russian envoy: report Gorsuch hearing date set for March 20 MORE (R-Iowa) described it, requires that any tax benefit the committee considers affect “at least 10 entities.”
Considering the internal rule, Grassley said, “I think it’s a stretch of the use of the word ‘earmark’ to include tax provisions as earmarks.”
Grassley acknowledged that one type of earmark not subject to the rule is tariff suspension requests, which lawmakers submit to the tax-writing panels in an annual ritual that often benefits specific companies in their districts. But he contended that tariff breaks already receive a thorough scrubbing from trade regulators and lawmakers, making an order to label them unnecessary.
Earmark analysts said that the Finance Committee’s rifle-shot rule misses the point of disclosing targeted tax benefits. These provisions were dubbed “tax earmarks” during last year’s revolt by Republican appropriators, who felt they were unfairly singled out by a narrow definition of the term.
“To not direct members to actually stand by their earmarks is irresponsible for the committee,” said Steve Ellis, a vice president at Taxpayers for Common Sense. “This isn’t saying that you can’t push for an earmark or a tax preference. You just have to say you’re doing it.”
Despite the assertion by former Ways and Means Committee Chairman Bill Thomas (R-Calif.) that his committee also abided by the rifle-shot rule, several tax earmarks made it into the 2004 FSC/ETI tax bill, most notoriously a ceiling-fan break for Home Depot.
Richard Kogan and James Horney, both at the liberal-leaning Center on Budget and Policy Priorities (CBPP), questioned how much teeth the rule would have in practice.
“It may be against committee rules,” said CBPP senior fellow Kogan. “But committee rules aren’t self-enforcing. If the chairman doesn’t object or nobody raises a point of order, it stays in.”
Horney, CBPP’s director of federal fiscal policy, echoed GOP appropriators’ objections last year in comparing the uneven standards for spending and tax earmarks.
“You could have a provision that benefits an entire congressional district and that’s an appropriations earmark, but you can have a tax benefit that goes to 12 companies and that’s not an earmark under the rifle-shot rule,” Horney said.
DeMint’s initial earmark-disclosure rule followed the rifle-shot standard of more than 10 beneficiaries, but Senate Majority Whip Dick DurbinDick Durbin McConnell: I’m very sympathetic to 'Dreamers' Senate Dems move to nix Trump's deportation order Dem senators call for independent Flynn probe MORE (D-Ill.) replaced it on the floor with what he described as a stronger standard. In a January floor speech, Durbin argued that defining a tax earmark as enriching more than 10 entities “allows for a loophole.”
“We do not come up with a number … but, rather, keep it in the category of a tax benefit that is clearly designed to help a limited group of taxpayers of a certain group compared with others,” Durbin said.
A GOP aide said that Baucus’s decision not to send a letter raised questions about whether Democrats were ready to keep their promises of earmark transparency.
“It’s telling that Senators Reid and Durbin can’t get their own chairmen in line on their signature ethics issue,” the GOP aide said. “Durbin decried immediate earmark disclosure as piecemeal, but there’s nothing more piecemeal than allowing every committee chairman to make their own rules.”
The final Senate standard pegged a tax earmark as benefiting a “limited group” of companies or people, but it kept the tariff-break definition at fewer than 10 entities. Ellis noted that the “limited group” definition can be applied more narrowly or more broadly than the Finance rifle-shot rule, allowing members leeway to report earmarks as fully as they see fit.
The Baucus aide pointed out that committee reports already label provisions in tax bill as narrowly or broadly applicable.
The tariff suspensions bill is generally assembled late in the year, by which time Democrats expect tax-earmark rules to have the force of law regardless of Baucus’s move. But the Senate’s first targeted tax breaks of the year could come as soon as this month on the energy bill.
And if last year’s lobbying measure — which never made it to conference — offers any preview of this year’s talks, official tax-earmark rules may be slow in coming. Ellis said the uncertain future of earmark transparency calls for not just a letter from Baucus, but support from Senate Majority Leader Harry ReidHarry ReidIf Gorsuch pick leads to 'crisis,' Dems should look in mirror first Senate confirms Mulvaney to be Trump’s budget chief Democrats declare victory after Puzder bows out MORE (D-Nev.) and House Speaker Nancy Pelosi (D-Calif.).
“Should Baucus do it? Yes. Should Reid move forward with a Senate rules change? Yes,” Ellis said. “Should Speaker Pelosi and the House get off the dime and pass [a lobbying bill]? Priceless.”