Public Affairs & Government Relations

Oversight & Investigations Informer – 5.11.21

NOTABLE DEVELOPMENTS

What We Are Watching:

GOP TO VOTE ON OUSTING CHENEY: On Wednesday, the House Republican Conference will vote on removing Rep. Liz Cheney (R-WY) as chair, the No. 3 position in House GOP leadership. Rep. Elise Stefanik (R-NY) is a favorite to replace Cheney, with House Minority leader Rep. Kevin McCarthy  (R-CA) officially endorsing Stefanik on “Sunday Morning Futures with Maria Bartiromo” on Fox News, according to The New York Times.

BIG FOUR TO TALK INFRASTRUCTURE WITH BIDEN, HARRIS: President Joe Biden and Vice President Kamala Harris will host their first bipartisan meeting with House and Senate leaders on May 12 at the White House.  With House Speaker Nancy Pelosi (D-CA), Senate Majority Leader Chuck Schumer (D-NY), Senate Minority Leader Mitch McConnell (R-KY) and House Republican Leader Kevin McCarthy (R-CA) in attendance, President Biden is expected to raise common policy goals and infrastructure for discussion. As The Wall Street Journal predicts, the conversation’s outcome will likely define the future of President Biden’s $4 trillion in spending proposals.

Week Ahead:  

The House Oversight and Reform Committee will hold a hearing on Questions about the Capitol Insurrection, May 12, 10 a.m.

Senate Environment and Public Works – Subcommittee on Transportation and Infrastructure will hold a hearing on Equity in Transportation Infrastructure, May 11, 10 a.m.

Key Insights:  

As President Biden signals that he’s ready to compromise on infrastructure plans, so is the Senate Majority Leader. At the first in-person caucus meeting of the year, Leader Schumer urged his Democratic colleagues to reach across the aisle and find Republican partners for bipartisan legislation; Schumer is also putting plans for a new budget reconciliation bill on hold to allow centrist Democrats the time to explore the possibility of compromise on a scaled-down infrastructure package. Meanwhile, President Biden is planning to meet with Sen. Shelley Moore Capito (R-WV) on Thursday, along with a group of Republican Senators who have proposed a counter-proposal of $568 billion narrowly focused on traditional infrastructure measures like roads and bridges. Though House Speaker Pelosi has slated July 4 as an informal deadline for passing some form of infrastructure legislation in the House, that timeline will likely slip given the state of ongoing talks.

ENERGY SECTOR

What We Are Watching:

OIL CEOS ASKED TO TESTIFY: Rep. Katie Porter (D-CA), who has a reputation for asking tough questions of executives, has invited the CEOs of ExxonMobil, EOG Resources, and Devon Energy to testify before the House Natural Resources Subcommittee on Oversight and Investigations next week for a hearing to “examine the contributions of the oil and gas sector to jobs and the economy.”

MORE QUESTIONS ON BIDEN PERSONNEL CHANGES: Reps. James Comer (R-KY) and Ralph Norman (R-SC), Ranking Members of the Committee on Oversight and Reform and the Subcommittee on Environment respectively, are again pressing the Biden administration on environmental personnel shifts. This time they’re seeking documents related to the reassignment of Betsy Weatherhead, a climate scientist with support from both sides of the aisle who was appointed in November by former President Donald Trump to lead the National Climate Assessment. The Congressional duo made a similar request last month over Environmental Protection Agency (EPA) Administrator Michael Regan’s decision to abruptly fire all the members of that agency’s scientific advisory boards.

Week Ahead:  

House Natural Resources Committee – Subcommittee on Energy and Mineral Resources will hold a hearing on Coastal Communities and Offshore Drilling, May 13, 1 p.m.

Key Insights:

FEW SOLUTIONS TO EMINENT DOMAIN: The invocation of eminent domain by pipeline companies came under scrutiny by the House Oversight Committee’s Subcommittee on Civil Rights and Civil Liberties last week, with Republicans and Democrats on the panel pushing for new laws to reign in the legal authority given to companies. But NIMBY-ism cuts both ways, as the country’s ambitious plans to rapidly decarbonize the grid face similar headwinds to building out new transmission lines.

FINANCIAL SERVICES SECTOR

What We Are Watching:

GAMESTOP SAGA CONTINUES:  House Financial Services Committee held its third hearing on GameStop, which was also Gary Gensler’s first testimony as Securities and Exchange Commission (SEC) Chairman. During the hearing, Gensler discussed his request that the SEC pursue rule-writing on retail trading and short selling.

DOJ HOUSING APPEAL: The Justice Department said it would appeal a federal judge’s decision vacating a national eviction moratorium and seek a stay of the ruling pending appeal. U.S. District Judge for the District of Columbia Dabney Friedrich ruled earlier Wednesday that the Centers for Disease Control and Prevention exceeded its authority when it imposed a nationwide ban on evictions for nonpayment of rent in September.

NEW GUIDANCE FOR FINTECHS: The Federal Reserve announced a proposal for comment to allow financial technology companies direct access to its payments network. The guidance could help these companies gain entry into the vaunted Fed system.

Key Insights:

SEC Chair Gary Gensler’s comments during the GameStop hearings and his staffing efforts indicate the SEC plans to increase its enforcement efforts.

HEALTHCARE SECTOR

What We Are Watching:

INSURERS UNDER PRESSURE TO WAIVE COVID-19 TREATMENT COSTS: Last week, Rep. Katie Porter (D-CA), alongside nine other Democratic representatives wrote to the CEOs of Aetna, Anthem, and UnitedHealth, urging them to continue waiving cost-sharing for COVID-19 treatment. In the letters, Rep. Porter accuses the insurers of putting “profits before the wellbeing of the people of this country.” Many insurers, including the three addressed in the letters, originally agreed to waive cost-sharing for COVID-19 treatments but reinstated cost-sharing requirements earlier this year.

ORGAN PROCUREMENT ORGANIZATIONS PRESSED TO PROVIDE INFORMATION: On Tuesday, May 4, the House Committee on Oversight and Reform Subcommittee on Oversight held a hearing recommending reforms in the organ transplant industry. Subcommittee Chairman Rep. Raja Krishnamoorthi (D-IL) cited a story quoting anonymous Organ Procurement Organizations (OPO) industry officials as saying, “We need to share only the minimum information required, and he’ll eventually go away.” Chairman Krishnamoorthi threatened additional inquiries if OPOs do not cooperate with congressional investigations.

PROVIDERS LOOKING TO PASS ON ADDITIONAL COVID EXPENSES TO INSURERS: According to Kaiser Health News, healthcare providers are looking to pass on the additional costs of treating patients during the pandemic, such as personal protective equipment (PPE), to insurers. Last year, the Centers for Medicare and Medicaid Services (CMS) rejected the American Medical Association’s (AMA) request to approve a procedure code allowing doctors to bill public insurers for PPE and other COVID-related expenses.

Week Ahead:

The Senate Committee on Health, Education, Labor and Pensions (HELP) will hold a hearing on Efforts to Combat COVID-19, May 11, 10 a.m.  Notable witnesses include Dr. Anthony Fauci, Director of the National Institute of Allergy and Infectious Diseases at the National Institutes of Health (NIH).

House Energy and Commerce – Subcommittee on Health will hold a hearing on the FY2022 HHS Budget, May 12, 10:30 a.m. The witness list and hearing memo are forthcoming.

Senate Finance – Subcommittee on Healthcare will hold a hearing on the COVID-19 Pandemic and Mental Health, May 12, 3 p.m.

 Key Insights:

 On Tuesday, the House Energy and Commerce Committee held an extensive hearing to evaluate H.R.3, the Elijah E. Cummings Lower Drug Costs Now Act, and H.R. 19, the Lower Costs, More Cures Act. H.R. 3, the Democratic proposal, passed in the House last Congress. A particularly large number of committee members attended the hearing, suggesting that drug pricing reform might be a priority in this session. Though these bills differ significantly in their approach to lowering drug prices, they both include caps on out-of-pocket spending, suggesting this might be a point of bipartisan consensus for future legislation. In a speech last month, President Biden expressed support for Medicare drug pricing but, he did not include any such provisions in his $1.8 trillion American Families Plan, making passage of drug pricing reform unlikely.

INDUSTRIALS SECTOR

What We Are Watching: 

EPA OIG CALLS FOR AIR POLLUTANT RESTRICTIONS: The Office of Inspector General (OIG) for the EPA published a report that found EPA has yet to update its rules surrounding ethylene oxide and chloroprene since classifying the pollutants as carcinogenic. The report urges EPA to strengthen restrictions on ethylene oxide and chloroprene emissions to protect residents of at-risk communities throughout the U.S.

CARPER PUSHES FOR MORE ZERO-EMISSIONS AUTOS: Last week, Senate Environment and Public Works (EPW) Committee Chairman Tom Carper (D-DE) called on the EPA to impose a federal emissions standard for new autos that resembles the standards proposed in California. Specifically, Chairman Carper is calling on the EPA to require that half of all new light passenger automobiles are zero-emission by 2030 and all new light passenger automobiles are zero-emission by 2035.

ATSDR RELEASES FINAL PROFILE ON PFAS: The Agency for Toxic Substances and Disease Registry (ATSDR) has released its final toxicological profile on PFAS and maintains more conservative minimal risk levels than those used by EPA when crafting exposure limits.

Week Ahead:

House Appropriations – Subcommittee on the Departments of Transportation, and House and Urban Development, and Related Agencies will hold a hearing on FAA Safety Oversight, May 12, 10:00 a.m. Notable witnesses include FAA Administrator Steve Dickson.

Key Insights: 

FTI’s experts explore how leaders from Washington D.C. to Brussels seek to tie the economic recovery of air travel to more sustainable air travel – read more in a new thought leadership piece.

FTI’s experts discuss upcoming Senate legislation that seeks to counter China’s global influence while also addressing alleged trade and intellectual property violations – read more in a new thought leadership piece.

TECH, MEDIA & TELECOM SECTOR

Week in Review: 

FCC NET NEUTRALITY RULEMAKING HACKED: A report last week from New York State Attorney General Letitia James’s office found that over 80% of public comments submitted in the FCC’s 2018 rulemaking to scale back certain internet regulations were fake. The report highlights outside marketing firms who specialize in generating comments and claims commenters were tricked into providing their personal information in exchange for lures that included sweepstakes entries, discounted children’s movies, and free trials.  

BIDEN ADMIN BLOCKS GIG WORKER RULE: The Labor Department has announced plans to nullify a rule that made it more difficult for companies to classify a gig worker, such as an Uber or DoorDash driver, as an employee under federal law, signaling a tougher enforcement stance on worker classification.  

SPECIAL API’S IN APP STORE: New documents in Epic Games’ lawsuit against Apple detail special access to certain App Store API’s given to Hulu and other developers. These APIs for privileged use include a cancel/refund API and other services which had not yet come to the full developer market.  

Key Insights:  

BE CAREFUL WHAT YOU WISH FOR: Facebook first proposed its independent Oversight Board in 2018 as a serious response to the Cambridge Analytica scandal and accusations that it promulgates fake news. Last week’s ruling by the Board criticized the company while upholding its decision to ban former President Donald Trump from the platform should help answer skeptics who questioned the Board’s ability to act independently. But the company’s opportunity to tell critics “we told you so” appears to come at the price of funding an institution that will buttress criticisms of company decisions as arbitrary, craven, biased, and self-serving. The Oversight Board’s credibility rests on holding its patron accountable. We’ll look to see if Facebook will always be compliant … or if it ever feels compelled to push back. 

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