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Some Senate GOP Leaders Say They Hope to Take Up the Issue Early Next Year
By: Kristina Peterson
Updated Dec. 16, 2014 11:36 p.m. ET
WASHINGTON—Congress ended the year Tuesday night without extending a federal terrorism insurance program slated to expire later this month.
With lawmakers from both chambers gone until January, the program is expected to lapse. Its fate wasn’t entirely clear, though some members of the Senate GOP leadership said they hoped to consider it early next year, when Republicans will control Congress.
“I’m guessing it gets taken up right away next year,” said Sen. John Thune (R., S.D.)
Tuesday night, Sen. Tom Coburn (R., Okla.) prevented the Senate from quickly considering a bill passed by the House last week extending the federal terrorism insurance program for six years.
House and Senate negotiators had hoped to include the terrorism insurance extension as part of a broader, must-pass spending measure, but failed to reach an agreement. House leaders separately took up the insurance bill, which included new changes to the 2010 Dodd-Frank financial law.
Mr. Coburn had concerns about a provision establishing an independent national board making it easier for insurance agents and brokers to operate across state lines.
A bill passed by the Senate earlier this year would have phased out the board over two years, but the House bill didn’t wind it down.
Mr. Coburn wanted to remove the provision from the terrorism risk bill or allow states to be able to opt out of the multistate licensing system. That provision “takes away the 10th Amendment right of every state to control their own insurance agents and brokers,” he said earlier Tuesday.
The terrorism insurance program allows the government to act as reinsurer to insurance companies to help cover losses when the cost from an attack exceeds certain thresholds. Real-estate developers, hotels, sports leagues and insurers have been pressing Congress to extend it for more than a year.
Senate leaders resisted changing the House-passed bill because congressmen already have left Washington for the year. House leaders made clear they wouldn’t return to Washington to revisit it, Senate Majority Leader Harry Reid (D., Nev.) said Tuesday night.
“We all know that if we change the bill, it’s gone,” Mr. Reid said on the Senate floor. “It’s unfortunate, but his [Mr. Coburn’s] objection is going to kill” the bill.
Democrats criticized House leaders for allowing the Dodd-Frank provision to be added to the bill. That provision would have relaxed part of the Dodd-Frank law by prohibiting financial regulators from imposing margin and other requirements on farmers, ranchers and nonfinancial firms that use derivatives transactions to hedge business risks.
Supporters contend that the language merely clarifies the intent of the Dodd-Frank law. Critics have warned some firms could use the exemption to create risky derivatives trading businesses.
“Tonight, Senator Coburn struck the final blow when he objected to bringing the bill to the floor,” said Sen. Charles Schumer (D., N.Y.) “We hope the House will pass a bill quickly because billions of dollars of projects and hundreds of thousands of jobs are at risk.”
Mr. Coburn’s defiant stance Tuesday night was one of the final acts of the retiring lawmaker, whose willingness to block legislation earned him the nickname “Dr. No.” Mr. Coburn often opposed federal spending he viewed as wasteful.
For more information, contact Chivaroli & Associates.
