Serrano statement at markup of 2016 Financial Services & General Government Appropriations bill

Thank you, Mr. Chairman.

Let me begin by thanking you for the way you have conducted this subcommittee.  You have been fair with our side throughout this year’s appropriations process, and although there are lots of things here that we don't agree on, you have always sought out our opinion and attempted to find the middle ground where it was available.

I also want to thank the staff on both sides of the aisle for all the hours they have put into creating this bill and report.  We are all thankful for the time and energy they have put into this endeavor.

Before I go into detail about what our side opposes, let me mention several areas where I want to commend the majority.  The Community Development Financial Institutions Fund is funded at $233.5 million, which is at the level requested by the President, and $3 million above last year.  The Small Business Administration is also well-funded in the Chairman's Mark, and important funding is included for several business loan programs like the Microloan program, the PRIME program, Small Business Development Centers and Women's Business Centers.  In addition, the Federal Defenders are funded at the request level, which will help ensure that we live up to our constitutional obligations.

Unfortunately, despite these areas of agreement, this is simply not a bill that our side can support.  The Mark before us is a prime example of the harm being caused by staying at the current sequestration funding levels.  The 302(b) allocation for this subcommittee is 6 percent below last year.  No other subcommittee had such a large percentage cut from their allocation.  The result is that numerous agencies are severely underfunded, and this subcommittee has been unable to invest in areas that are critical to taxpayers, consumers, investors, and federal employees.  Let me detail just a few of the more troubling accounts in this bill. 

The IRS is cut almost $900 million from last year's funding levels.  This takes the agency below the 2004 funding level, despite the fact that there are more taxpayers and more responsibilities for the agency.  Once again, this is a misguided attempt by the majority to do two things: punish the entire agency for the problems regarding 501(c)(4) investigations, and prevent the full implementation of the Affordable Care Act.  Last year, these efforts to harm the IRS ultimately hurt the taxpayer by increasing the deficit and reducing taxpayer services- in fact, for every dollar that the majority cut from the IRS last year, our nation lost 6 dollars owed to it that should have been paid.  If this year's cuts became law, we can expect more of the same. 

Let me just note one serious problem with the majority’s decision to underfund the IRS.  We all know that the IRS just suffered a well-publicized hacking attempt, which highlights the need for additional investment in IT security. Yet this bill inexplicably cuts the two accounts responsible for these efforts by a total of $378 million from last year.  I think members from both sides agree that we need to protect the privacy of taxpayers' information- but this bill fails in that regard.

Beyond the IRS, there are severely problematic cuts to funding levels for the General Services Administration, which receives no construction funding this year.  This will prevent the GSA from moving forward on important projects across the country, and will harm private sector job growth.

The Securities and Exchange Commission is also funded at $222 million below the President's request.  The SEC is our cop on the beat for Wall Street, and chronically underfunding our primary enforcement arm for the financial markets invites more wrongdoing.  It is also problematic that the majority has sought to limit the use of the SEC’s Reserve Fund, which is dedicated to IT upgrades.

The Federal Communications Commission is cut by $25 million below last year’s already flat level, with the majority choosing to ignore the FCC’s efforts to move to a smaller and more cost effective location.  This is the very definition of penny-wise and pound foolish.  This funding is going to force the FCC to either expend more dollars later to move to a new location, to spend more to renew their lease at their current location, or to make more cuts to their core functions to pay for it.

Unfortunately, these are not the only objectionable parts to this bill.  In recent years, this bill has become a magnet for highly partisan and damaging riders in a large variety of areas.  This year is no different.  The riders added by the majority hurt consumers, taxpayers, federal employees, the residents of the District of Columbia, and even attack the President of the United States.  Our side has serious objections to many of the provisions added to this bill.  Adding these riders, which the majority knows our side deeply opposes, is not helpful to the appropriations process, or for the work we try to do on behalf of the American people. 

Like last year, let me mention a few of the most excessive riders.  First, this bill prevents the FCC from implementing their net neutrality rule until the final disposition of three pending lawsuits on this issue.  This is a fundamentally flawed effort from both policy and procedural perspectives.  The FCC took an important step in February to help consumers and businesses alike by ensuring their internet content and access is treated the same way as everyone else's.  This rider would take away these important protections in order to promote the interests of a few large corporations.  Additionally, although it purports to only last as long as the lawsuits are ongoing, the very text of the rider encourages the plaintiffs in these lawsuits to do everything in their power to delay a resolution to these cases. 

On another subject, I am extremely bothered by the majority's insistence in trying to hamstring the President's efforts to conduct foreign policy with regard to Cuba.  This bill contains three riders which would seek to reinstitute the very Cuba policies that have failed our nation for the past 50 years.  The Cold War ended more than 25 years ago, and we do business with countries that have suspect human rights and democracy records- including both China and Vietnam.  Yet some people seem to think that we should treat Cuba differently.  As someone who has long advocated for engagement instead of isolation, I find these efforts hypocritical and unwarranted. 

Beyond these areas, there are numerous other problems with this bill.  The IRS is prevented from reforming the 501(c)(4) process that caused so much confusion and controversy, and from enforcing the individual mandate of the Affordable Care Act—a move that CBO says will result in a loss of revenue of $279 M in FY 16 and $133 M in FY 17.The SEC is prevented from requiring public corporations to disclose their political contributions.  And the District of Columbia is once again prevented from using their own dollars to provide legal abortion services for low-income women.  Our side strongly opposes all of these riders, and many more besides.

In the end, this bill is a tale of two problems: an inadequate allocation and unacceptable riders.  While some on the right may cheer the details of this bill, I think that most Americans will look at this legislation and simply shake their heads.  It is not based in reality, and I think most people realize that.  At the end of the day, this is not a bill that will garner the kind of bipartisan support needed to become law. 

And I find that sad.  The Appropriations Committee was once the place where our two parties could hash out their differences and find a compromise that worked in the best interest of all our constituents.  Today, as this bill demonstrates, our committee has just turned into another messaging piece that seems intended to preclude the kind of agreement that the Appropriations Committee was once known for.  Our party will try to fix this legislation as it moves through the process, but until the other side faces reality and realizes that sequestration cannot continue, it will be difficult to improve the bill at the current allocation level.  As it is, this is not a bill that our side will support.

Thank you Mr. Chairman.