With Democrats in control of Congress, 2007 will usher in an era of renewed government oversight. At the same time, the slim majority in Congress means it is unlikely that 2007 will be a time for passing legislation unless it is truly bipartisan. For advocates of fairness, honesty, and accountability in government, it is likely to be a busy and exciting year. However, for those who hope for increased spending on low-income programs and social justice initiatives, it may prove disappointing. Fiscal Policy Many expect President Bush’s budget for FY 2008 to propose slashing domestic spending and that the administration's tax cuts be made permanent. While these proposals may be “dead on arrival,” Democrats are not likely to want to pass a budget that has a deficit higher than what the president proposes in his budget. Assuming the president’s budget is austere, it will put even greater pressure on Democrats to constrain spending, especially since they are unlikely to propose tax increases. Rep. David Obey (D-WI) and Sen. Robert Byrd (D-WV) will chair the House and Senate Appropriations Committees. Obey and Byrd may attempt to boost funding in fiscal year 2008 for some domestic discretionary programs including education, Community Development Block Grants, medical research and homeland security. Emergency supplemental spending requests from the administration are unlikely to end, but their fate at the hands of the committee is uncertain. There is some interest in budget reform that would put an end to serial emergency supplementals from the administration to pay for the Iraq war. On entitlement spending, the pay-as-you-go requirements that Democrats will restart will make it very difficult to increase funding for entitlement programs since they will now have to be paid for, and the Democrats are not eager to propose tax increases. This will put immediate pressure on capped entitlements, such as the State Children Health Insurance Program, since to maintain the same number of children served this year will require additional spending for next year. Additional spending will require either more revenue or cuts in other entitlements. Getting spending bills done will be a high priority. However, conservatives will most certainly interrupt the process as often as possible to demand more limited government. They did this when their own party was in control, but it was limited. Now there will be no limit. Given remarks from Obey and Byrd on Dec. 11, one thing is almost virtually certain—FY 2007 funding, which is the current fiscal year, will be delivered through a long-term continuing resolution that will last until the end of the fiscal year. Both committee chairmen said such a move will allow them to focus on moving their agenda forward in the FY 2008 appropriations bills, but agencies and public interest organizations are concerned that a long-term CR would shortchange many important programs through Sept. 30, 2007. Obey and Byrd have alluded to "adjustments" they would make, but that remains unclear. With Rep. John Spratt (D-SC) and Sen. Kent Conrad (D-ND) taking over the Budget Committee in their respective houses, there will be greater emphasis on deficit reduction. They will likely make strong efforts to stick to new pay-as-you-go budget rules that require new tax cuts and entitlement spending to be offset by new revenue or spending cuts. They may also be interested in earmark reform and exploring ways to address the $345 million tax gap — the difference between what is owed in taxes and what the government actually collects. Finally, they may explore the idea of a discretionary spending cap. Both Sen. Max Baucus (D-MT) and Rep. Charlie Rangel (D-NY), the chairs of the tax writing committees, are keen on investigating the tax gap as a means of closing deficits and bringing in much needed revenue for national priorities. One of their top agenda items may be the ever-growing Alternative Minimum Tax, which was originally designed to ensure super-rich Americans would pay some level of income tax. Without reform, the AMT will impact 23.4 million Americans in 2007 (up from 3.5 million currently), a few of whom will make as little as $50,000 per year. While the change in control of the legislative branch makes it almost assured the estate tax will not be repealed in the 110th Congress, there is still a very real threat of a repeal-like proposal moving forward. Baucus has long been an opponent of the tax, and it will likely fall upon the House next year to act as a backstop against irresponsible and unfair proposals that give more tax breaks to the nation's wealthiest families. Government Transparency and Oversight Rep. Nancy Pelosi (D-CA), the incoming Speaker of House, has made it clear that transparency will be a watchword in the new Democratic controlled Congress, with several relevant reforms listed as part of the Democrats' first 100 hours agenda. For instance, we are likely to see requirements that earmarks — line items in appropriations bills that members of Congress designate for specific projects in their districts. Another likely rule change would require that bills be available to Members and the general public well in advance of any vote. Rep. Henry Waxman (D-CA), who will chair the House Government Reform Committee, is likely to place a high priority on oversight and accountability. Waxman has shown tenacious interest in the manipulation and censoring of agency scientists as well as the extensive overuse of pseudo-classification categories, such as Sensitive But Unclassified, to restrict public access to many types of information important to protecting public health and safety. Waxman has also been concerned about the growth in government contracting and the increase in fraud and abuse that has come with that growth. It is likely that Waxman’s committee will seek bipartisan solutions to these types of problems. Finally, Waxman has expressed concerns about the regulatory playing field being tilted heavily in favor of the regulated community’s interest. It is quite likely that Waxman will be keeping an eye on the regulatory process, including OMB’s Office of Information and Regulatory Affairs. In the Senate, Sen. Joseph Lieberman (ID-CT), will be chairing the government oversight committee. Like Waxman, Lieberman is a strong proponent of government transparency. He has been a leading voice on e-government initiatives to make government more accessible to the public. Lieberman has also been very involved in chemical security issues, calling for legislation to insure our chemical plants are safe and secure and that there is some level of public accountability to make sure such efforts are working. Despite long bipartisan efforts in both the Senate and House on chemical security, the Republican leadership decided to pass a weak set of chemical security provisions tacked onto the FY 2007 Homeland Security Appropriations bill, which passed at the end of the 109th Congress. Lieberman may be interested in taking up the issue again despite the provisions passed in the 109th, in order to craft a more complete program. Improving agency implementation of the Freedom of Information Act (FOIA) is another access issue likely to see greater attention next year. Several bills proposed by Sens. John Cornyn (R-TX) and Patrick Leahy (D-VT) to improve the FOIA process received increasing bipartisan support during 2006, and President Bush's Executive Order 13392, issued Dec. 2005, solidified the government-wide commitment to improving FOIA. The order, which required agencies to develop FOIA improvement plans, has been considered by many to be a positive but insufficient improvement. It is likely that a legislative solution will be sought and the Cornyn-Leahy bills may very well be revived. With transparency being the Democratic watchword, 2007 might be an opportunity to promote a proactive right to know agenda. While FOIA needs to be strengthened, many advocates have hoped that FOIA would be a vehicle of last resort for public access. Ideally, agencies would have an affirmative obligation to disseminate information rather than a passive one, as suggested by FOIA. It is conceivable that the new Congress may consider such ideas, starting in 2007. Nonprofit Advocacy and Speech Rights Nonprofit lobbying and advocacy rights may be taken up by Baucus’ Senate Finance Committee, although it will not likely be a top priority. Baucus released a report regarding potential abuses by tax exempt organizations in relation to convicted lobbyist Jack Abramoff. In the report, Baucus called for examining lobbying rights of nonprofits. Additionally, the ranking member of the committee, Sen. Charles Grassley (R-IA), has raised concerns about nonprofit voter engagement, which could emerge again in 2007. The incoming Congress has already indicated that lobby disclosure will be a top priority. The topic is part of the Democrats’ first 100 hours agenda, and will likely include an expansion of information collected on campaign contributions and client fees, increased frequency of reporting, electronic report filing, certification of accuracy of filings, and criminal penalties for false information. Both Congress and the administration hold the potential to impact nonprofit speech rights when it comes to anti-terrorism policies. The Treasury Department seems determined to keep a tight grip on donations it has seized from a number of charities that the department claims are supporters of terrorism, and no one in the Bush administration has indicated any interest in releasing those funds for legitimate humanitarian efforts. Though Congress has expressed little interest in this issue in the past, there is a possibility that 2007 might be different, especially if there is judicial action challenging Treasury’s stance on frozen funds and its terrorist designations.