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December 16, 2010

RE: Washington Watch Federal Update - For the period ending December 10, 2010

Dear Mayor:

Based on information provided by the National League of Cities (NLC) and recent Press reports, here is an update on some crucial developments in our nation’s Capital.

I.   Spending Plan Remains Elusive 

On December 9, by a vote of 212 to 206, the House of Representatives passed a long-term continuing resolution (CR) that will keep funding for most government programs at fiscal 2010 levels next year. However, the fate of that legislation in the Senate remains uncertain as appropriators consider other options. On Tuesday, this week,  Senate Appropriations Committee Chairman Daniel Inouye announced A $1.1 trillion Senate Democratic plan to fund the federal government—a nearly 2,000-page document that includes about 6,700 earmarks—is drawing fire from conservative groups and some Republicans, setting up a test of GOP resolve to cut spending. Senate GOP leaders have pledged to fight the measure when it comes up for a vote, possibly over the weekend. While some Senate Republicans have said they would support the bill, it wasn't clear whether Democratic leaders had the 60 votes needed to pass it.

In the House, Republicans leaders have said they would oppose the Senate bill if it reached them. However, passage would require only a simple majority in the House.

On Wednesday, Defense Secretary Robert Gates called on Congress to pass an omnibus spending bill rather than continuing current levels of spending, which would happen under the House bill. Congress needs to settle this matter by December 18, or the federal government could be forced to shut down.

II.   Fate of Bond Provisions in Tax Cut Extension Debate Appears Settled

Yesterday in Washington, the Senate endorsed the Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act of 2010, which follows the framework of President Obama's plan to extend the Bush-era tax cuts. However, Senate Majority Leader Harry Reid's bill, like the plan introduced in the House, does not include the vital access to credit bond provisions.  The Senate vote, 81-19, was a resounding endorsement of the compromise President Obama struck with Republican leaders just two weeks ago. The package would extend current income and investment tax rates for two years, resurrect a lapsed program of unemployment benefits, cut payroll taxes temporarily and reinstate the estate tax.

House floor debate is set for today.

The fate of access to credit provisions originally introduced in the American Recovery and Reinvestment Act, including the Build America Bonds, appears to be settled, and the authorization for these instruments will expire. This is expected to increase local government borrowing costs.

III.  EPA Consults with Local and State Governments on Stormwater Rulemaking

Earlier this week, as required by Executive Order 13132: Federalism, the U.S. Environmental Protection Agency (EPA) held a consultation meeting for local and state government groups on the upcoming stormwater rulemaking and the range of regulatory options being considered. 

The rulemaking aims to take a new approach to stormwater management by shifting from managing stormwater at a treatment facility toward managing it where it falls, using green infrastructure practices such as infiltration, evapotranspiration, and harvesting/use. As part of the rulemaking, EPA is:

  • exploring options for expanding the universe of federally-regulated municipal separate storm sewer systems (MS4s);
  • considering developing performance standards for discharges from new and redeveloped sites;
  • evaluating options for establishing municipal retrofit requirements;
  • exploring the desirability of establishing different requirements for transportation facilities; and
  • establishing Chesapeake Bay-specific requirements.

EPA aims to propose a rule in September 2011 and to finalize it in November 2012, with an implementation date of one to two years after finalization. The deadline for submitting comments, which NLC will be doing, is January 22, 2011.  NLC is encouraging municipalities to file comments, as well.  For additional information on the rulemaking, visit

We will do our best to keep you posted on Federal policy developments that effect New Jersey municipalities. If you have any questions, contact Jon Moran at 609-695-3481, ext. 121 or

Very truly yours,


William G. Dressel, Jr.
Executive Director





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