Congress Moves On Tax Extenders, Stalls On Terror Insurance
Among its last actions of the year, the Senate passed a $41.6 billion package of tax breaks but failed to move a bill reauthorizing the Terrorism Risk Insurance Act.
Congress adjourned for the holidays last week. Before leaving town the Senate failed to renew a terror insurance program, but, in its last action, cleared a $41.6 billion package of tax breaks for both businesses and individuals retroactive through 2014.
Republicans and Democrats approved the one-year deal last week by a 76-16 vote after the White House refused support for a broader package that would have permanently extended certain business-friendly provisions along with some breaks for the middle class favored by Senate Democrats.
After the White House voiced its opposition to that deal, outgoing Senate Finance Committee Chairman Ron Wyden (D-OR) tried unsuccessfully to rally support for a two-year extension of most tax breaks that the committee had passed in the spring. Senators from both parties this week lamented the one-year extension, which will force Congress to tackle tax extenders again in the next Congress.
“With this stop-and-go tax extender bill, Congress is turning in its tax homework eleven months late and expecting to earn full credit,” Wyden said on the Senate floor. “This package of incentives—which applies only to 2014—will last two more weeks before families and businesses will be thrown back into the dark about what taxes they owe.”
Senate Majority Leader Harry Reid (D-NV) struck a more positive tone in applauding Republicans and Democrats for coming together to ensure that individuals and business receive these tax credits for the 2014 tax year. Reid said he is hopeful that lawmakers will work to make many of the tax provisions permanent when the 114th Congress convenes in January.
Meanwhile, Senate leaders failed to move a bill to reauthorize the Terrorism Risk Insurance Act (TRIA) after Sen. Tom Coburn (R-OK) refused to agree to a unanimous consent request that would have set up a final vote just before the Senate left town.
While Reid could have sought passage of the bill through normal Senate procedures, that would have kept the Senate in session beyond last week. Some Senate Democrats were also unhappy with House Republicans’ decision to pull TRIA reauthorization out of the omnibus spending bill earlier this month and add a rider to the bill that they say undermines the Dodd-Frank Wall Street reform law.
TRIA was first passed in the aftermath of 9/11 to provide a federal backstop for terrorism risk insurance coverage. After the attacks, reinsurers and primary insurers paid out more than $30 billion in claims, and many began withdrawing from the terrorism risk insurance market. Many lawmakers and organizations that hold events at major venues feel that TRIA is still needed to protect the economy against unpredictable, catastrophic terrorist attacks.
“A clean TRIA bill, like the one that passed the Senate with 94 votes earlier this year, would pass the Senate quickly,” Reid said in a statement last week. “Every day that goes by without TRIA poses unacceptable levels of risk to cities like Las Vegas.”
Departing Sen. Tom Coburn (R-OK) wouldn't let the Terrorism Risk Insurance Act through last week. (Chip Somodevilla/Getty Images)