Sen. Ron Wyden (D-Oregon) and Sen. George Allen (R-Virginia) were joined by Rep. Christopher Cox (R-California) to announce a renewed effort to make the internet access tax moratorium permanent. Six months ago, Congress approved a compromise bill that extends the moratorium through 2007. Unlike previous bills, the legislation introduced in the Senate would preserve the existing grandfather clauses until November 2007.

Sources close to Sen Jim Jeffords (I-Vermont) have told the Washington Post that the senator intends to retire after this term. From the article:

Vermont Sen. Jim Jeffords, an independent who triggered one of the most dramatic upheavals in Senate history when he quit the GOP four years ago, intends to retire at the end of his term next year, officials in his home state and Washington said Wednesday.

Jeffords will make the announcement Wednesday afternoon in Burlington, three sources close to the senator told The Associated Press on Wednesday. They spoke on condition of anonymity.

Jeffords, 70, has been adamant in saying he will seek re-election, but there have been increasing concerns voiced about his health in recent weeks.

The seat being vacated could favor Democrats, as Vermonters voted for Sen. Kerry over President Bush in the 2004 election by a 59% to 39% margin.

The success of reaching a FY 2006 budget resolution could depend on whether a key Senate holdout, Sen. Gordon Smith (R-Oregon), is satisfied with an administration plan for a commission to study obtaining savings from Medicaid.

Gordon Smith is scheduled to meet with Health and Human Services Secretary Michael Leavitt, this week and expects to receive the administration’s draft plan for a Medicaid commission. Smith is insisting upon a commission to study Medicaid savings as a condition for his vote, and six other GOP budget moderates, to adopt a budget resolution.

Appointing such a commission cannot be done through the budget resolution, which does not have the force of law. The commission must be created through either the legislative or executive branch.

Establishing a commission would push the deadline for producing a reconciliation bill, which includes spending cuts into September. The September deadline would allow lawmakers to have the commission’s recommendations in hand when they devise the Medicaid piece of that bill.

Smith has said that he could not accept cuts as high as $12 billion over five years, a figure that Senate Budget Chairman Judd Gregg (R-New Hampshire) has told the House is the absolute maximum the Senate can accept in Medicaid cuts.

The Senate version of the budget resolution called for a $17 billion in spending cuts while the House version called for $69 billion in mandatory spending cuts.

However, with a deal elusive on Medicaid it is difficult to wrap up negotiations on reconciliation instructions for other panels. One unknown is how much in cuts would have to be carried by the House Ways and Means and Senate Finance committees.

The negotiations illustrate the tricky nature of assembling a budget with reconciliation instructions. As one committee succeeds in driving down its number, this puts pressure on other committees to produce more savings.

Yesterday the Senate Finance Committee approved a measure funding the Highway Trust Fund at $284 billion to pay for the six-year transit reauthorization bill.

The funding measure works mainly through a 18.4 cents per gallon gasoline tax. The $284 billion level is the amount sought by the administration and contained within the House version of the package. (HR 3). Last year the Senate sought a much higher figure, leading to a stalled conference with the House.

Now that the measure has moved through all four Senate committees with jurisdiction over the bill, it will move to the floor, where amendments to increase the total dollar amount will likely be offered. The Majority Leader, Sen. Bill Frist (R-Tennessee) has not yet indicated the schedule for the bill to move forward.

Senate Majority Leader Bill Frist (R-Tennessee) has been threatening to invoke a parliamentary maneuver known as the “nuclear option” to eliminate filibusters against judicial nominees. If Frist decides to invoke the nuclear option by forcing a ruling from the Senate’s presiding officer that filibusters are unconstitutional (an action that would only need 51 votes to succeed, as opposed to the 60 vote supermajority currently needed to break a filibuster) it will definitely impact the prospects of important legislation. Democrats have indicated that if the nuclear option is imposed their response will be to bring the Senate to a standstill - possibly leaving legislation such as the transportation reauthorization bill and welfare reauthorization stalled.

Senate Minority Leader Harry Reid (D-Nevada) has refused to say which pieces of legislation would be affected by a Senate slow-down, but has noted that legislation for American troops in action in Iraq and Afghanistan and measures affecting critical government services would not be impacted.

Not only could action on the Senate floor be affected, but committee markups could also drag on for days or weeks if Democrats use a little known rule to prevent committees from meeting once the Senate has been in session for two hours.

The timing on when Majority Leader Frist might decide to use the nuclear option is unclear. However, he has indicated that his plan would not curb legislative filibusters. “I will not act in any way to impact the rights of colleagues when it comes to legislation,” Frist said.

As the House is debating the energy bill on the floor this week, markups on important bills will be happening in both House and Senate committees.

The Senate Finance Committee is scheduled to mark up the funding portion of the $284 billion transportation reauthorization bill tomorrow, becoming the fourth and final committee to handle the massive legislative package. The Environment and Public Works, Banking and Commerce panels have all marked up their portions of the bill in recent weeks. The bill has largely breezed through the committees so far, with senators choosing to save their amendments and battles over funding levels for the floor.

Also on Tuesday, the House Homeland Security Committee will markup H.R. 1544 to change the distribution method of first-responder homeland security funding. Unlike the Senate bill that was marked up last week which would authorize $2.9 billion in funding for 2006 and 2007, the House bill authorizes no funds. Rather, it simply applies a new distribution method to several existing grant programs.

On Thursday, the Surface Transportation and Merchant Marine Subcommittee in the Senate will hold a hearing on reauthorizing Amtrak. Last week the Bush Administration unveiled its "Passenger Rail Investment Reform Act" to Congress. The legislation seeks to transition Amtrak into a purely operating company, create a federal-state partnership to support passenger rail, introduce market-based competition to the system, and set up an interstate compact to maintain the heavily used Northeast Corridor service. Under the legislation, Amtrak would no longer be responsible for maintaining tracks, stations, and other infrastructure. The administration has drawn criticism for essentially zeroing out Amtrak's fiscal year 2006 budget

Finally, the House Resources Committee's NEPA Task Force will convene next Saturday morning for the first field hearing in the effort to examine local effects of the 35-year-old environmental law. The National Environmental Policy Act directs agencies such as the Forest Service or Bureau of Land Management to conduct environmental studies of projects or permit applications under consideration to assess the potential effects of those proposals, usually in the form of environmental assessments or environmental impact statements. Western Republicans have taken aim at the law in recent years, saying it leads to unnecessary and costly delays for a wide range of federal projects. The "Task Force on Improving the National Environmental Policy Act" has six months to study and hold field hearings on the issue.

Senate Budget Chairman Judd Gregg (R-New Hampshire) and House Budget Chairman Jim Nussle (R-Iowa) have been in informal talks this week to bridge the gap between the House and Senate version of the FY2006 budget resolution. Gregg is under pressure from House conservatives to produce far larger cuts than the Senate included in its budget resolution. Gregg has indicated to Nussle that the Senate will consider cuts of up to $43 billion over five years which is the halfway mark between the House and Senate budget resolutions. However, Gregg is not guaranteed support at this number and it is bound to anger House conservatives who would rather see a number closer to the mandatory cuts in the House resolution of $69 billion.

Cuts to Medicaid continue to remain a big issue. During debate on the budget resolution, the Senate adopted an amendment offered by Senator Gordon Smith (R-Oregon) to strip instructions to the Finance Committee to produce $15 billion in budget cuts (the bulk of which was to come from Medicaid). More recently, 43 House GOP members signed a letter circulated by Congresswoman Heather Wilson (R-New Mexico) protesting up to $20 billion in Medicaid cuts.

House conferees for the conference committee will remain unnamed as the informal discussions between Gregg and Nussle continue.

Next week the House will consider a comprehensive energy bill while the Senate will continues to debate the fiscal 2005 supplemental spending bill (HR 1268), which has stalled over immigration-related amendments. Following passage of the supplemental, the Senate could consider bills related to welfare, child custody, and the conference report on the fiscal 2006 budget resolution, if an agreement is reached.

The Water Resources Development Act of 2005 passed on a voice vote in the Senate Environment and Public Works Committee yesterday. The bill would authorize more than $7 billion in Army Corps of Engineers projects. Several senators withdrew amendments so that the bill could make it to the Senate floor as soon as possible, keeping debate about corps reform, one of the sticking points of the bill in past years, to a minimum. What little discussion there was about corps reform centered on an amendment offered by Senate EPW Committee ranking member Jim Jeffords (I-Vermont) and Sen. Max Baucus (D-Montana) that was included in last year’s version of WRDA. The amendment would have established an independent peer review process within the Office of the Inspector General of the Army and was voted down by voice vote.

The shipping and construction industries have shown support for this year’s version, saying the bill would help boost the economy. However, environmentalists have taken issue with corps reform language, saying it is superficial -- allowing review of project costs and benefits by the corps, rather than requiring an independent investigation. Some experts have said that passage of a WRDA bill this year is again unlikely because of overall spending cuts. (WRDA is supposed to be renewed every two years but has not been reauthorized since 2000.)

Also in the EPW’s committee meeting yesterday, EPA nominee, Stephen Johnson was cleared with a 17-1 vote. Senator Tom Carper (D-Delaware) was the lone dissenter and he is expected today to block a Senate floor vote on Johnson until the Bush administration meets his various demands for analysis of air pollution legislation. Carper, the lead Democratic negotiator in last month's talks over rewriting the Clean Air Act, wants EPA to assess the economic and health benefits of three competing legislative proposals for power plants, but the agency has refused. A 24-year EPA veteran, Johnson over the last two weeks has told Carper that EPA is willing to generate the requested data so long as there is consensus among other key lawmakers as to the parameters of the work. While the original plan was to bring the nomination to the full Senate as early as next week, Carper's plans to hold up the nomination would effectively spike that plan. The only way Johnson's nomination could move if Carper raises objections, outside of EPA satisfying the information request, would be for GOP leaders to force a cloture vote requiring 60 supporters.

Rep. Heather Wilson (R-New Mexico) and 43 of her Republican colleagues have sent a letter to Budget Committee Chairman Rep. Jim Nussle (R-Iowa) to protect Medicaid funding in conference negotiations on the fiscal 2006 budget resolution.

With House Democrats united in opposition to Medicaid cuts, Rep. Wilson’s coalition could provide the majority needed to adopt a nonbinding motion to instruct House conferees to drop a budget provision that would likely result in Medicaid cuts. That would put both the House and Senate on record against Medicaid cuts, which Republican budget writers consider essential to their effort to rein in mandatory spending.

The House version of the budget resolution (H Con Res 95) directs the Energy and Commerce Committee to find $20 billion in savings over five years, most of which would come from Medicaid. The Senate voted to strike a similar $15 billion instruction to the Senate Finance Committee before adopting its version of the budget (S Con Res 18) last month. No amendment targeting the proposed Medicaid cuts was permitted in the House.

In the Senate, Sen. Gordon Smith (R-Oregon), who sponsored the amendment stripping the instructions to the Finance Committee, is negotiating with Majority Leader Bill Frist (R-Tennessee) on Medicaid savings. Sen. Smith has said he wants savings from Medicaid to be limited, but that he wants to support the final version of the budget resolution.

Sen. Norm Coleman (R-Minnesota) has recommended that Medicaid cuts be included in the budget blueprint but delayed until the later years of the resolution’s five year time frame. Arguing, that would allow time for study by a Medicaid commission that Smith’s amendment called for and Rep. Wilson’s group has endorsed.

Medicaid is one of a number of mandatory spending programs from which Republican leaders hope to extract some savings. There are also wide gaps between the House and Senate on agriculture programs.

Yesterday, House Homeland Security Committee Chairman Christopher Cox (R-California) introduced a bill (H.R. 1544) to provide funding for state and local first responders. The Grant Reform and the Faster and Smarter Funding for First Responders Act of 2005 would guarantee each state 0.25 percent of the first-responder grant, and distribute the remainder based on risk and threat. States with an international border or international port would receive at least 0.45 percent. The Homeland Security Committee will hold a hearing on the bill tomorrow. The current state minimum for formula grants is 0.75 percent.

Changes to the formula stalled last year because of disagreement with the Senate between high density urban areas and less-populated states. Yesterday, the House Homeland Security Subcommittee on Emergency Preparedness, Science, and Technology held a hearing focusing on homeland security in rural states. State homeland security directors from Missouri, Iowa, and North Carolina testified that a risk/threat based formula for distributing homeland security funding could work only if it considers agricultural and other concerns, and focuses not only on the high density urban areas.

Chairman Cox is also trying to keep his bill from being referred to additional committees since multiple committees have jurisdiction over homeland security funds. Four House chairmen who could ask for referrals have already signed off on the legislation. The text of Cox’s bill can be found here in pdf format.

Over in the Senate, the Senate Homeland Security and Government Affairs Committee is marking up its first-responder funding bill (S. 21) today. S. 21 provides each state with a minimum of 0.55 percent of the first-responder funding pool.

While the Senate originally planned to not take action on the energy bill until the summer months, it appears plans have changed. The Energy and Natural Resources Committee will go to markup in May, and the Finance Committee will have its tax package ready by the time the energy bill gets to the floor. Energy and Natural Resources Committee Chairman Pete Domenici (R-New Mexico) indicated that since the House Ways and Means Committee will be moving faster on the tax portion of the bill than originally thought, the Senate feels comfortable quickening its pace. Ways and Means will be marking up a proposed $7.6 billion package today. This is slightly higher than the White House proposal of $6.7 billion over 10 years which both chambers believe is not high enough.

The markup of the bill in the House Energy and Commerce Committee continues today after a seven-hour markup session yesterday when the committee completed work on three titles of the bill -- with 13 titles to go.

The House Resources Committee will also begin marking up energy bill sections under its jurisdiction today, including several energy incentives and other provisions not in last year's comprehensive package. Committee Chairman Richard Pombo (R-California) will advance several provisions that were not in last session's bill. They include a provision placing new limits on National Environmental Policy Act review of renewable energy projects on federal lands and a "set America free" section that establishes a commission to craft a policy that would seek to ensure North American energy independence by 2025.

Wednesday’s markup of the Water Resources Development Act (WRDA) in the Senate Environment and Public Works Committee is one of several important markups that will occur this week. Funding for Army Corps projects is subject to authorization under WRDA, which Congress intended to renew every two years but has not been reauthorized since 2000. A large stumbling block has been disagreement over how to reform corps operations. Last year, the Senate was able to get WRDA out of the EPW Committee only to see it stall on the Senate floor. Environmentalists have already said that the corps reform language in this year’s version of WRDA is superficial -- allowing review of project costs and benefits by the corps, rather than requiring an independent investigation. House Water Resources and Environment Subcommittee Chairman John Duncan (R-Tennessee) is said to be working on a House version of WRDA which will probably look much like the bill passed by the House in 2003. That version requires an independent peer review of most corps projects costing more than $50 million.

Also on Wednesday, the EPW Committee will hold a confirmation vote on Stephen Johnson to head the EPA. (He has been acting chief since January.) Johnson’s confirmation remains questionable despite his decision to cancel a controversial plan for monitoring pesticide use in the homes of 60 Florida children. Senate EPW Committee ranking member Jim Jeffords (I-Vermont.) and EPW Clean Air Subcommittee ranking member Tom Carper (D-Delaware) have a number of long-standing information requests at EPA concerning legislation to rewrite the Clean Air Act for power plants, climate change and the Bush administration's regulatory overhaul to the New Source Review routine maintenance provisions for industry.

Other important markups this week include Wednesday’s markup of legislation regarding funding for homeland security programs in the Senate Homeland Security and Government Affairs Committee. On April 14, the Senate Commerce, Science and Transportation Committee will markup the transportation reauthorization bill. The Senate Commerce Committee is one of multiple Senate committees that has jurisdiction over the transportation reauthorization bill. It is still unclear as to when that bill will come to the Senate floor.