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In-Depth: A Look Ahead at the 113th Congress

Crossroads Indepth

The tumultuous 112th Congress came to an end in early January with a dramatic last moment agreement between the President and Congress that addressed elements of the so-called fiscal cliff. While the resulting legislation was a major victory in our industry’s efforts to gain certainty for dividend, capital gain, and estate tax rates, it also set the stage for another major confrontation later this winter and spring over spending policy and the nation’s debt ceiling.

The 113th Congress Gets Underway
The 113th Congress, with 97 new House and Senate members, was sworn in earlier this year. Already the Congress has elected to increase the nation’s debt limit temporarily to accommodate additional borrowing through May 18th. Other important behind the scenes work has also been occurring on the Hill. Below is a first look at the organization of the House Energy and Commerce Committee, the Senate Commerce Committee, and their key communications and consumer protection subcommittees, as well as some of the issues lawmakers are likely to consider in the upcoming session. 

House Energy and Commerce Committee
The House Energy and Commerce Committee met last week and approved its organization and oversight plan for the 113th Congress. The top leadership of the Committee has not changed since the last Congress. The committee will continue to be chaired by Rep. Fred Upton (R-MI), and Rep. Henry Waxman (D-CA) will again serve as the Ranking Minority Member. Due to election losses and retirements, a number of new members were appointed to the committee, including Reps. Gus Bilirakis (R-FL), Renee Ellmers (R-NC), Ralph Hall (R-TX), Bill Johnson (R-OH), and Billy Long (R-MO). On the Democratic side, the committee welcomed back Reps. Jerry McNerney (D-CA), Bruce Braley (D-IA), and Peter Welch (D-VT), and added Reps. Ben Ray Lujan (D-NM) and Paul Tonko (D-NY).

Similarly, the leadership of the Communications and Technology Subcommittee has not changed. The subcommittee will continue to be led by Chairman Greg Walden (R-OR) and Ranking Member Anna Eshoo (D-CA). Rep. Walden has announced his agenda for the 113th Congress, which will continue to focus on “policies that foster innovation, encourage investment, and protect freedom through a job-focused lens.” Although Rep. Eshoo will have a more limited role in setting the Subcommittee’s agenda, her stated goals include preserving the basic rules of the road for the Internet. To that end, she has vowed to introduce a net neutrality bill if the FCC’s Open Internet Order is overturned by the D.C. Circuit this spring.

The most significant change that could affect our industry at the committee’s top echelon occurred on the Commerce, Manufacturing, and Trade Subcommittee, which has jurisdiction over consumer protection, including privacy, data security, and the Federal Trade Commission. As a result of Rep. Mary Bono Mack’s (R-CA) defeat in the general election, Rep. Lee Terry (R-NE) has become the chairman of that subcommittee – and as the former vice chairman of the Communications Subcommittee, Terry is quite familiar with our industry’s issues and concerns. On the Democratic side, Rep. G.K. Butterfield (D-NC) has been replaced as Ranking Member by Rep. Jan Schakowsky (D-IL), although Butterfield will continue to serve on the subcommittee. 

Senate Commerce Committee
The Senate Commerce Committee is smaller than its House counterpart but has undergone more dramatic changes for the 113th Congress. These include a new ratio to reflect the increased Democratic majority in the full Senate, a new Ranking Republican, and a number of new faces on both sides of the dais.

Sen. Jay Rockefeller (D-WV) will remain chairman, but has announced that he will not seek reelection in 2014. Additionally, with the retirements of Sen. Kay Bailey Hutchison (R-TX) and Sen. Olympia Snowe (R-ME), as well as Sen. Jim DeMint’s (R-SC) New Year’s Day 2013 resignation, Sen. John Thune (R-SD) has leaped to the head of the line on the Republican side to become the new Ranking Minority Member. Sen. Richard Blumenthal (D-CT) and Sen. Ben Schatz (D-HI) will join the Majority on the Committee. Sens. Dan Coats (R-IN), Tim Scott (R-SC), Ted Cruz (R-TX), Deb Fischer (R-NE), and Ron Johnson (R-WI) will join the Minority. Democrats will keep 13 seats on the committee, but Republicans will have 11 seats instead of the 12 seats they held in the last Congress.

With Sen. John Kerry (D-MA) becoming Secretary of State, there will soon be a new Democrat joining the committee to fill his seat. Moreover, all these changes have somewhat slowed the committee’s subcommittee organizational process. Kerry chaired the Communications Subcommittee in the 112th Congress, and DeMint served as the subcommittee’s Ranking Minority Member, so decisions on their replacements and on the leadership of other key subcommittees will presumably be made in the near future. 

Universal Service/ICC Reform
The implementation of the FCC’s reform order is of critical importance to all our member companies. USTelecom will continue its advocacy efforts on the Hill to ensure our elected leaders promote implementation of the reform order in a way that supports the construction and operation of the broadband networks that rural consumers need. In particular, we are focused on ensuring that our rate-of-return members can get the transparency and long-term funding certainty critical to making further network investments. 

Rural Utilities Service Infrastructure Loan Programs
The 112th Congress concluded without approving a multi-year extension of Agriculture Department programs including the RUS broadband and telecom loan programs. As Congress resumes work on this multi-year legislation, USTelecom will work with legislators toward reauthorizing these infrastructure loan programs in a manner that encourages their use in expanding and upgrading rural broadband networks. 

Communications Act and FCC Reform
While it is evident that new technologies and competition have reduced the need for heavy-handed FCC regulation, comprehensive reform legislation typically takes several Congresses to develop. USTelecom will continue efforts to educate and advocate for major reform to create a level playing field with the many service, device, and application providers that are currently unregulated. The association will also work with lawmakers on other initiatives affecting how our industry is treated at the Commission and in the marketplace relative to our competitors. 

The budget deal reached just after New Year’s Day dealt with personal income tax and estate tax rates in provisions that, at least in principle, are considered “permanent.” But neither corporate rates nor other corporate tax provisions have been settled for the long-term. Thus, the one-year extension of bonus depreciation we achieved as part of the recent budget agreement will have to be renewed and extended by the end of 2013 in the absence of comprehensive corporate tax reform. Many in Washington are hopeful that the effort to achieve such comprehensive reform will bear fruit, but for now it remains a long-shot. 

While comprehensive privacy legislation is not on the immediate horizon, USTelecom’s ultimate goal here is eliminating the disparity in the way the law treats network and edge providers. We seek one set of privacy standards administered by one agency for all actors in the Internet ecosystem. Congress continues to hold additional hearings on privacy and related legislation is introduced regularly. Consequently, the issue requires constant education, reinforcement, and monitoring, particularly with such a large crop of freshmen entering the House and Senate this year.