Is Congress Running Out of Time to Bring Back Earmarks? (For FY20, At Least)

[March 2 update – a few hours after this story was published on March 1, the chairman of the House Appropriations Committee released a letter to colleagues (dated February 28 but not released to the public until late afternoon on March 1) saying “Unfortunately, there is currently not the necessary bipartisan, bicameral agreement to allow the Appropriations Committee to earmark. For that reason, I do not expect Fiscal Year 2020 House spending bills to include Congressionally-directed spending.” So the predictive part of this article has come true, at least partially.]

March 1, 2019

House Transportation and Infrastructure chairman Peter DeFazio (D-OR) told transportation stakeholders this week that he wants to bring back earmarked spending (which he would rename “Article I projects” to emphasize Congress’s constitutional primacy in the power of the purse).

And House Appropriations chairman Nita Lowey (D-NY) told Roll Call two weeks ago that she supports bringing back what she called “Congressionally-directed spending.”

But the decision of whether or not to revive the earmarking process has to be made by party leaders, who have been slow to address the issue this year. And with the Appropriations Committee preparing to start drafting fiscal 2020 appropriations bills in April, and with T&I possibly acting on some kind of infrastructure legislation in the coming months, there are only a few weeks left for leaders to make the decisions on earmarks before they risk losing the opportunity to earmark those bills.

Bringing back earmarks doesn’t seem that complicated, because:

Nothing currently in the rules of the House or Senate bans earmarks. Nothing. 

But there are existing transparency rules, which require a bit of background.

History. In response to widespread earmark abuse (see: SAFETEA-LU, Duke Cunningham, Jack Abramoff, etc.), the House and Senate adopted new transparency requirements for earmarks. The House adopted a rule requiring all earmarks to be identified by requesting member in September 2006 (H. Res. 1000, 109th Congress) and those requirements were then expanded in January 2007 (H. Res. 5, 110th Congress) and tweaked in June 2007 (H. Res. 491, 110th Congress). The Senate enacted very similar provisions into its own rules via section 521 of the big ethics reform law in September 2007.

Earmarking continued in the fiscal 2008, 2009 and 2010 budget cycles under the new transparency rules, but the scandals didn’t stop (see: Paul Magliochetti). Then Republicans took over control of the House, and at the direction of Speaker Boehner (who had always criticized earmarks and who said he never, in his career in Congress, sought one), House Republicans adopted their own internal policy that “no Member shall request a congressional earmark.”

This meant that House Democrats weren’t going to get earmarks, either, and the word went out from Boehner’s office to committee chairmen that no bills containing earmarks were going to be allowed to go to the House floor. But the underlying written rules of the House never changed – they were never amended to add an earmark ban. Senate Republicans at the same time adopted their own internal moratorium on seeking earmarks for the time being.

In 2011-2012, Democrats still controlled the Senate, but if the House was going to refuse to move or accept any bills containing earmarks, the only way the Senate was doing to get earmarks into final legislation was by some kind of high-profile brinksmanship (like threatening to shut the government down, and we have all seen how that really isn’t a winning move). Senate Republicans were forswearing earmarks, so the Democrats would have had to fight the battle all on their own. And President Obama was backing Boehner’s play. So the Senate Appropriations Committee announced in a February 2011 press release that it was implementing its own earmark moratorium for that Congress, and the Senate Environment and Public Works Committee then moved the MAP-21 surface transportation bill under chairwoman Barbara Boxer (D-CA) without earmarks.

The GOP took over the Senate in the 2012 elections and have continued renewing their internal earmarking ban in Republican Conference resolutions every two years. (Until this time – the November 2018 organizing conference delayed consideration of whether or not Senate Republicans were going to renew the earmark ban, and as far as we know, the question still has not been settled.)

Current rules on the books. In the standing rules of the House of Representatives currently in effect, the earmark transparency requirements have two parts. Clause 9 of rule XXI (the rule that deals with bills being considered on the House floor) provides a point of order against House consideration of any bill, joint resolution, amendment thereto, or conference report unless it is accompanied by either a complete list of all earmarks identified by the sponsoring legislators, or else a statement by the bill sponsor that the legislation contains no earmarks. (By “earmark” in this context we are including earmarked spending, targeted tax breaks, and targeted tariff breaks.)

Then, in the Code of Official Conduct (rule XXIII), clauses 16 and 17 govern earmarks. Clause 16 essentially says that chairmen or party leaders cannot condition the inclusion of earmarks for a member on the way the member votes on legislation. And clause 17 requires any member requesting an earmark from a committee to provide, in writing, to the committee chairman and ranking member, five pieces of information (under the text of the rule, “earmark” means spending and the tax and tariff breaks are listed separately):

“(1) the name of the Member, Delegate, or Resident Commissioner;

“(2) in the case of a congressional earmark, the name and address of the intended recipient or, if there is no specifically intended recipient, the intended location of the activity;

“(3) in the case of a limited tax or tariff benefit, identification of the individual or entities reasonably anticipated to benefit, to the extent known to the Member, Delegate, or Resident Commissioner;

“(4) the purpose of such congressional earmark or limited tax or tariff benefit; and

“(5) a certification that the Member, Delegate, or Resident Commissioner or spouse has no financial interest in such congressional earmark or limited tax or tariff benefit.”

All of these requirements apply to the Senate in almost identical form in Senate rule XLIV.

The Big Loophole. You don’t have to stare at the text of the second and third items on the mandatory disclosure list for very long to see the problem. Under current House and Senate rules, members requesting earmarked spending are held to a lower transparency standard than are members requesting earmarked tax or tariff breaks – members requesting earmarked spending don’t have to identify the ultimate financial beneficiaries, only the location.

This is problematic for transportation earmarks, where often, the main advocate for a new bypass or exit or turn lane or transit stop is a real estate developer who owns property that will skyrocket in value if the government comes along and uses taxpayer money to make access to the property easier. Under the pre-2011 system, it was very common for real estate developers to hire lobbyists and throw fundraisers for members of Congress, who then sponsored earmarks to improve access to the properties owned by the developers.

That didn’t mean that a project wouldn’t also provide benefit to the general public. Often, these earmarks were supported by local political leaders (but not always). And the state DOT or local government were usually the ones that would have to actually carry out the earmark using federal funds. (For infrastructure projects, the recipient is not always the prime beneficiary – the state or local government may receive the federal funding and carry out the project but that doesn’t mean they are really the beneficiary.) But the projects didn’t provide anywhere near as much benefit, per capita, to the general public as they did to the real estate developer.

Politically, maintaining a double standard that benefits earmark-seeking real estate developers is probably a bad look for Democrats, especially since the current President of the United States, who is viscerally opposed by Democratic leaders, is a real estate developer with a long history of seeking Congressional earmarks that benefit his properties.

But in the House, the five-point earmark transparency requirement listed above is written into the Code of Official Conduct, the enforcement of which is the jurisdiction of the Ethics Committee. If the certification requirement is strengthened to include spending earmarks as well as earmarked tax and tariff benefits, and a member fails to list the earmark beneficiaries known to them (and getting a check from someone at a fundraiser makes them known to you), it would be a violation of ethics rules and could prompt investigation or sanction.

What next? It is clear that no committee in the House or Senate is going to start dishing out earmarks unless their party leadership decides that is the way to go. And no one (House D’s Senate D’s, House R’s, Senate R’s) appears to want to go first. Rather, Chairman Lowey’s statement of two weeks ago said “I hope that we can reach a bipartisan, bicameral agreement to restore this important practice.” In other words, if they are going to brave the reaction from the “drain the swamp” crowd, they all want to hold hands and jump at the same time.

At a hearing of the House Rules Committee in January 2018, the now-chairman of the committee, Jim McGovern (R-MA), spoke in favor of bringing back earmarks, saying, of earmarks, “in my district, it’s not pork, it’s nourishment.” But McGovern also added, “Obviously we have to do this in a way where the public has trust in what we’re doing, that passes all the smell tests where there’s no conflict of interest, but I gotta tell you, I know my district better than people here in Washington…”

What additional transparency reforms would be needed before earmarks could be brought back? Yours truly suggested eight possible improvements, starting with the disclosure of real estate interests that would benefit from the earmark. An odd coalition of former appropriators and public interest groups put forward a five-point plan a year ago that included an outright ban on directing earmarks to anyone that contributed to their campaign (and banning the legislative staff of a member from participating in fundraising activities).

But Congressional leaders do not appear particularly close to deciding which, if any, transparency or other reform improvements should be enacted to allow earmarks to come back. And these rules have to be in place before Congressional committees can solicit earmarks, a lengthy process which involves setting up committee websites and databases to allow members to fill out project questionnaires, making provisions for public review of any questionnaires and certifications, and – possibly – hiring extra staff to deal with all that. (Earmarks took up a lot of appropriations and transportation committee staff-hours back in the day.)

Only then can earmarks be added to bills. And since most appropriations earmarks are written in extralegal report language (not in a bill itself), that really means that the standards have to be set, earmarks submitted, requests vetted, funds allocated to members, and earmarks put into the report along with accompanying certifications before the Appropriations Committee orders the bill reported. (Waiting until conference to add earmarks is called “airdropping” and was the subject of several scandals, which makes Congress less likely to bring that part of the process back.)

With the appropriators scheduled to start marking up bills in April, it may already be too late to bring back earmarks for most, if not all, of the fiscal year 2020 appropriations bills.

 

 

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