Interest groups with stake in reform line up for meetings with House tax-writers

The House Ways and Means Committee’s working groups on tax reform are putting lawmakers in a room with deep-pocketed players that have a huge financial stake in a rewrite of the code.

Lawmakers on the 11 working groups are quietly meeting with lobbyists and groups interested in preserving tax breaks and a variety of credits and deductions that could be targeted in legislation.

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The setup has raised eyebrows among government watchdogs, who believe the off-the-record talks could pad the fundraising coffers of lawmakers and help business interests make friends in high places. 

“By its very structure, [it] raises the eyebrows,” said Meredith McGehee, policy director for the Campaign Legal Center. “Who’s getting access and what kind of money are they going to receive from those interests?”

“It will be interesting to watch the contributions received by the working group members,” said Melanie Sloan, executive director for Citizens for Responsibility and Ethics in Washington (CREW). 

The House tax-writers say the meetings aren’t just closed-door powwows with special interests, and often involve combing through the massive tax code with the nonpartisan Joint Committee on Taxation.

“My Rolodex ain’t filling up,” said Rep. Jim McDermott (D-Wash.), the vice chairman of the working group on debt, equity and capital. “Not out of that bunch.”

Still, the lawmakers on the 11 working groups haven’t been shy about publicizing their involvement.

Just days after the groups were announced, Rep. Aaron Schock (R-Ill.) sent out a letter on his plans to work with the financial services working group that invited stakeholders to contact his staff with questions or concerns. 

Schock said that the working group’s undertakings, including meetings with the Joint Committee on Taxation (JCT), were giving him a broader perspective on the tax code, and perhaps even making him less reliant on K Street.

“My information by and large tends to come from lobby groups,” Schock said. “I can take meetings all day long of people who want to come in and advocate for their position in the tax code. But they’re not giving me the other side of the story, often times.”

The Illinois Republican, who is said to be interested in a run for governor next year, brushed aside the idea that his work on the financial services working groups could expand his donor list.

“I don’t need a working group to do that. That’s more work than I need to do. CME, CBOE, those groups — got great relationships with them,” Schock said, referencing the Chicago Mercantile Exchange and the Chicago Board Options Exchange. “So I don’t need to be going to more hearings to do that.

The working groups — which are tackling subjects that range from energy to the charitable sector to small business — also haven’t been asked to make recommendations for how to overhaul the code. 

Each group has a chairman and vice chairman, and members not assigned to a specific group can work with whichever ones they choose.

House Ways and Means Committee Chairman Dave Camp (R-Mich.) and the panel’s ranking member, Rep. Sandy Levin (D-Mich.), established the working groups as a way to help members better understand a tax code that now stretches for four million words. 

“The primary purpose — the only purpose — for Dave Camp and my decision is to really provide a structure on a bipartisan basis for us to sit down and really analyze the code,” Levin told The Hill. 

The groups could also help forge the bipartisan alliances that will be needed to enact tax reform in a deeply divided Congress. 

Camp has said he wants to pass a tax overhaul out of his panel this year, and Speaker John Boehner (R-Ohio) has set aside the symbolically important H.R. 1 for moving it through the House.

Still, even though JCT’s final report on the working groups won’t include recommendations, lawmakers concede that their meetings will shape how they approach tax reform. 

With that in mind, interest groups are making sure their views are heard. 

Rep. John Larson (D-Conn.), the vice chairman of the financial services working group, says he has several meetings scheduled with insurance representatives — an important industry in his district — when he leaves for recess. 

The National Association of Insurance and Financial Advisors and other associations have sat down with the group dealing with pensions and retirements.

“You go in and certainly try to do the best you can. The meetings really aren’t for purposes to try and twist someone’s arm,” said James Ballentine, who heads congressional relations for the American Bankers Association. “But really to get a sense of where they are and the issues that are important to you.”

Ballentine said the working groups are helpful because they allow stakeholders to quickly determine who they need to be dealing with. It also gives them a chance to dig deep into specific issues.

“You kind of almost wish every committee would do that,” he said. “It very much narrows the focus in your discussion, and it also narrows the people you have to work with.”

That narrower focus, Ways and Means members say, has allowed the working groups to make some progress on what Camp has called his top priority in this term. 

“Dave Camp and Sandy Levin, who see tax reform pretty differently, would not have agreed on this as an effort to boost fundraising, but as a way to move this forward,” said Rep. Kevin Brady (R-Texas), the chairman of the energy working group.

McDermott, who is working with Rep. Kenny Marchant (R-Texas) on the debt and equity group, said the groups could also help restore some of the trust that has evaporated between the parties over the years.

“A lot of people are kind of uncertain that this is really going to work this way. But up to this point, there’s no evidence that it isn’t,” McDermott said. “Kenny Marchant and I are not playing some crazy game.”

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