Hearing of the House Appropriations Committee - FY 2016 Financial Services and General Government Appropriations Bill

Hearing

Mr. Chairman, I rise today to present the Subcommittee's recommendation for the fiscal year
2016 Financial Services and General Government appropriations bill. As you know, the
Subcommittee has jurisdiction over a wide and diverse group of agencies and activities,
including the Treasury Department, Internal Revenue Service, Securities and Exchange
Commission, White House, District of Columbia, General Services Administration, Federal
Communications Commission, and Small Business Administration.

The bill before us today provides $20.2 billion in discretionary funding, which is $1.3 billion, or
6 percent, less than fiscal year 2015 and $4.8 billion, or 19 percent below the request. The
Subcommittee's allocation is a significant reduction compared to 2015, but sufficient to fund
programs that are essential to Americans.

This Subcommittee has the honor and Constitutional responsibility of funding our Federal
Judiciary. The bill increases their funding by $214 million above fiscal year 2015. This will fund
all federal court activities, the supervision of offenders and defendants living within our
communities, and the timely and efficient processing of federal cases. In addition, this
Subcommittee prioritizes funding for law enforcement activities. The High Intensity Drug
Trafficking Areas program receives a $5 million increase and Treasury's Office of Terrorism and
Financial Intelligence, which enforces sanctions programs, receives a $3.5 million increase.

Another priority for the bill is to support small businesses in order to foster job creation and
economic development. The bill provides $156 million for the Small Business Administration to
extend up to $23.5 billion in 7(a) loans and $7.5 billion in 504 loans. The bill also provides funds
to some of our nation's strongest entrepreneurial development programs such as the Small
Business Development Centers, Women's Business Centers, SCORE, microloans, and Veterans
Outreach Programs. The bill further promotes investment and growth in communities across the
nation by providing Treasury's Community Development Financial Institutions Fund with
$233.5 million, which is a $3 million increase above fiscal year 2015.

In order to live within our allocation level, we had to make tough decisions on where to reduce
funding. The bill today reduces funds for more than two dozen agencies and programs that can
operate with less, such as the Office of Management and Budget and the FCC. The brunt of the
reduction, however, is borne by the GSA and IRS since they are the two largest agencies in the
bill that both have a recent history of inappropriate behavior.

The bill eliminates all GSA funding for new construction, but provides an ample amount for
repair and alterations. Before adding new space to the Federal inventory, the Executive Branch
should take care of and make better use of what it already has. We also continue to push GSA to
develop an accurate inventory of all Federal property and designate funding specifically for
reducing surplus space.

The bill provides the IRS with $10.1 billion, which is $838 million below the current level and
$2.8 billion below the request. At this funding level, the IRS is funded below their fiscal year
2004 level. But the bill requires the IRS to make customer service a priority and funds the
Taxpayer Service account by more than $75 million above fiscal year 2015. With this funding
increase, the Committee expects the IRS to stop making excuses and to start answering the phone
and mail from American taxpayers.

It's been two years and three Commissioners since we learned about the IRS' inappropriate
scrutiny of certain groups, and the IRS continues to make embarrassing management mistakes at
the expense of customer service. To remedy this, the Committee includes extensive language to
prohibit the IRS from inappropriately singling out certain tax-exempt groups based on their
ideological beliefs or for exercising their First Amendment rights, wasting taxpayer dollars on
inappropriate conferences and videos, and providing bonuses to staff without evaluating their
conduct or tax compliance. In addition, the bill prohibits funds to revise regulations used to
determine the tax exempt status of organizations under section 501(c)(4) of the Internal Revenue
Code, or to implement the individual mandate.

In order to increase transparency and accountability of agencies created by Dodd-Frank, the bill
makes the Consumer Financial Protection Bureau and the Office of Financial Research subject to
the appropriations process and requires extensive reports on their activities. Since its inception,
the Bureau has been a very active regulator. However, I believe the Bureau has become
overzealous and is need of greater Congressional oversight. In addition, this bill replaces
indemnification agreements with confidentiality agreements for swap data repositories and
requires the SEC to submit a thorough report about this Committee's concerns about Dodd-Frank
and other financial regulations and a concerning lack of liquidity in U.S. markets.

Finally, I would like to speak to the inaccurate claims that the bill before us is trying to hide
provisions related to net neutrality. I made my displeasure with the rule known at our FCC
budget hearing in March, so it should come as no surprise that the bill, which was released in full
and as early as possible under Committee rules, would address this important matter. The bill
merely puts in place a legislative stay until the legality of the net neutrality rule can be
determined by the courts. Given the magnitude and controversy of this issue, removing the legal
ambiguity around it is needed to create a clear path forward. This bill also seeks to increase
transparency at the Federal Communications Commission by requiring rules be made available
to the public for 21 days before the Commission votes on them; this is the same number of day
that rules are circulated to Commissioners prior to a vote.

I would like to thank Chairman Rogers for his leadership and support of advancing the bill. I
would also like to thank all of the Subcommittee Members for their input into the bill and their
participation at our hearings this year.

To conclude, I would like to thank Ranking Member Jose Serrano. While I know that he believes
there should be additional funds in the bill, I appreciate Mr. Serrano's approach to the
Committee's work and value his advice. His input made the bill better. I look forward to working
closely with him and all Members of the Committee as our bill moves forward.

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