Senate Finance Committee Aims For TPA Mark-Up During Week Of April 20

The Senate Finance Committee has set April 21 as a target date for marking up a bill to renew Trade Promotion Authority (TPA), also called “fast track,” an action that is expected to be preceded by the introduction of the legislation and a Finance Committee hearing just a week beforehand, according to informed sources.

This decision to move forward on a bill has led some congressional sources and lobbyists to assume that Senate Finance Committee Chairman Orrin Hatch (R-UT) and Ranking Member Ron Wyden (D-OR) have reached agreement on the substance of the bill and will now focus on deciding what other trade bills would be passed along with TPA, these sources said. Other sources insist that this is not the case, and that the two sides are still working toward a compromise.

House Ways & Means Chairman Paul Ryan (R-WI) last week suggested that a miscellaneous tariff bill will not be ready in time to move with TPA. One lobbyist said even a bill to reform the MTB process would not be likely to move with TPA either.

Apart from dealing with other add-on trade legislation, the two sides will have to decide the details of the Senate-first strategy that TPA proponents are pursuing in the hope of avoiding two House votes on the TPA bill and creating momentum, sources said.

For example, there is no decision yet on whether the Senate Finance Committee markup will be followed by a Senate floor vote, or whether the Finance-approved bill will go to Ways & Means for a markup and a subsequent House vote before being sent back to the Senate.

Staff for Hatch and Wyden met on March 26, the day Congress left for the Easter congressional recess, to discuss a proposal submitted by Hatch earlier that week. Before that meeting, the Democratic side was optimistic that a deal could materialize that day, according to one informed source.

Administration officials have also been conveying a sense of optimism that fast-track legislation will move next month, sources said.

The decision to go ahead with moving the bill comes even as support continue to lag in the House, where pro-TPA lobbyists admit there is no reliable vote count. One congressional source said there continue to be wildly fluctuating numbers on how many Republicans will vote against TPA in order not to give President Obama more foreign policy authority. He said these numbers range between 40 to 80 Republicans that will oppose TPA.

This source disputed the notion previously put forward by a pro-TPA lobbyist that 55 Republicans could oppose TPA without a bill being in danger of failing. He said with 190 Republicans voting yes, there would have to be 30 Democrats in support, which he signaled would be a high mark to meet.

Some opponents have said they expect roughly 12 House Democrats to ultimately support TPA, but the source said there are more Democrats that are looking to vote yes. Whether or not they will do so will depend on what position Minority Leader Nancy Pelosi (D-CA) and Rep. Sander Levin (D-MI) take. If both of them came out in favor of fast-track, it would free up more Democrats to vote yes, sources said.

But sources signaled that at this time it is unlikely that Pelosi will take a favorable stance on TPA given negative signals she has given in closed-door meetings. One source said Pelosi could also be influenced by the fact that Sen. Elisabeth Warren (D-MA), a high-profile Democrat, has been critical of the Trans-Pacific Partnership (TPP).

However, several sources emphasized that Pelosi will use her role as a leader of the Democratic Caucus to create space for members to vote for fast-track even though others will not, in order to minimize the divisiveness of the trade issue within the party.

In terms of add-on legislation, an extension of Trade Adjustment Assistance (TAA) program is the most controversial issue that has to be settled. The program, which expires Sept. 30 this year, faces opposition from both House and Senate Republicans.

Ryan last week did not mention renewal of TAA as one of the bills that would move along with TPA, although he has previously said that it would be a part of the “conversation” about how to pass fast track (Inside U.S. Trade, Feb. 6). TAA is certain to be offered as an amendment in the Senate, though it may not be the expanded program proposed in a bill sponsored by Sen. Sherrod Brown (D-OH) and 34 other members.

In addition, there is wrangling over a slew of other issues that lobbyists want to add to the TPA bill. Among these are numerous technical trade law provisions that have languished for years for absence in an amendable trade bill, sources said. “Every consultant and every lobbyist is desperate to get these issues into the bill,” one lobbyist said. He said the committees’ decision on what to include will likely be determined on whether it will attract votes or not.

Ryan last week said he wants to move legislation to renew the African Growth and Opportunity Act (AGOA) and the Generalized System of Preferences (GSP), as well as a customs reauthorization bill, together as a trade package alongside TPA. He also indicated work is being done to reach bicameral compromises on those bills.

But other sources said that it is likely that only parts of a customs authorization bill passed by Senate Finance will be part of that package, particularly the so-called ENFORCE legislation sponsored by Wyden aimed at fighting circumvention of trade remedy orders.

Ways & Means Republicans have previously rejected the ENFORCE bill, which sets deadlines for Customs and Border Protection to act on circumvention complaints, in favor of the so-called PROTECT bill that does not. The PROTECT Act is sponsored by Rep. Charles Boustany (R-LA).

Private-sector sources said this week that there is an effort underway to work out a compromise between the two versions of trade remedy enforcement legislation.

There is also some interest by apparel importers in including the renewal of the latest version of the Haitian Hemispheric Opportunity Partnership Encouragement (HOPE) Act, which does not expire until 2020 — a long time from now in terms of trade program renewal, sources said. But proponents argue that Haiti is now at capacity in terms of producing apparel for the U.S. market, and needs the certainty that the program will continue to attract new investors.

Politically, including this program has the advantage of allowing the administration to put more pressure on the Congressional Black Caucus — a major backer of the original HOPE Act — to vote for TPA because it will mean the passage of legislation to help both Africa and Haiti, sources said.

Apparel importers are also considering pushing a renewal of a Nicaragua Tariff Preference Level (TPL), which has two parts. The first allows any kind of Nicaraguan-made apparel produced from third-country fabric to enter the U.S. duty free up to 100 million Square Meter Equivalents.

The second part of the TPL is a separate mechanism that applies to the production of trousers. It requires that each pair of trousers made with third-country fabric that Nicaragua ships to the U.S. must be matched by one pair made with regional fabric originating in the U.S. or countries that are signatories to the Central American Free Trade Agreement.

The National Council of Textile Organizations has made clear that it objects to the renewal of the non-matching TPL component in the context of a fast-track bill. But it is open to working with the committees on the renewal of AGOA and the HOPE bill to be included, sources said. NCTO last week announced it would back the fast-track bill provided it does not contain provisions too onerous for the textile industry. – Jutta Hennig