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Date: January 23, 2014
GSB Client Update

Garvey Schubert Barer Legal Update, January 23, 2014.

Within a few hours after my January 17, 2014 blog post read here, as we suspected, President Barack Obama signed the Consolidated Appropriations Act, 2014 (“2014 Act”) into law. Now, at least until September 30, 2014, our federal government may operate without interruption.

Each year, our government must pass bills that appropriate funds for all discretionary spending. In most years, a bill is passed by each of the twelve subcommittees in the House Committee on Appropriations and each of the twelve subcommittees in the Senate Committee on Appropriations.

When Congress cannot pass separate bills, it rolls the bills into one omnibus bill like the 2014 Act. This has become the norm rather than the exception over the past several years. You may be asking yourself why would Congress roll the bills into one single act rather than pass several smaller bills which will be easier for our lawmakers to review and debate. There may be many reasons, including:

  • Too much party disagreement to pass individual specific bills;
  • Too many issues pending before lawmakers to deal with several pieces of legislation;
  • Time constraints that may prevent dealing with appropriations in a piece meal fashion; and/or
  • The desire to bury in a single massive act some controversial spending provisions.

In the case of the 2014 Act, the answer is likely “all of the above.” In recent years, party disharmony appears to have heightened the difficulty of passing separate bills. With our government’s fiscal year being October 1 to September 30, timing is always a critical issue, making passing separate bills cumbersome. Not wanting to repeat the disastrous “fiscal cliff” historic event, however, lawmakers were likely especially anxious to get the 2014 Act passed as soon as possible. It is also the case that lawmakers currently have many other legislative matters on their plates, including tax reform and health care. With these pressures, an omnibus bill results.

The combined piece of legislation usually has buried in its 1000 plus pages some spending provisions that may be considered by some to be controversial. Given the size of the 2014 Act, over 1500 pages, lawmakers had little time to debate, let alone study, the entire bill and its nuances. Regardless of your party affiliation, you can find some provisions in the 2014 Act that you believe are troublesome. Maybe that is what compromise is all about. The 2014 Act includes many provisions that could have, standing alone, stalled or prevented the passing of individual smaller bills, including:

  • $90 billion of funding for the war in Afghanistan;
  • $1 billion of funding cuts to the Affordable Care Act’s Prevention & Public Health fund;
  • 1% increase in federal workers’ pay;
  • Cutting the IRS budget by over $500 million when the Tax Gap seems to keep growing;
  • Prohibition against the US Postal Service from eliminating Saturday delivery service; and
  • Prohibition against the US government transporting military prisoners in Guantanamo Bay, Cuba to the United States.

If you find none of these provisions the least bit troublesome, hopefully you will find humor in the provision in the 2014 Act that bans the funding of new portraits for our government officials. I guess lawmaking is akin to sausage making in that you throw all the contents in one end and a finished product comes out the other end.

For more information, contact Larry Brant.

Circular 230 Disclosure: The income tax principles, rules, and outcomes discussed in this update are intended to be used solely for general informational purposes. The information contained in this update is not intended to be used, cannot be used, for the purpose of avoiding federal tax penalties. The content provided in this update is for educational purposes only. It is not a substitute for legal advice. Transmission and receipt of this publication does not create an attorney-client relationship.

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