Federal Legislative Update
December 2003

December 12, 2003
December 4, 2003

12/12/03

Congress has adjourned for the year and returns on January 20, 2004.

News from Capitol Hill...

Assessing special-needs students

On December 9, 2003, the U.S. Department of Education issued its final regulation for assessing students with disabilities under ESEA/"No Child Left Behind." The bottom line: This regulation allows much more flexibility than previous Department guidance, following much of the NEA advice.

NEA is calling on the Administration and the Department to allow states and school districts that missed Adequate Yearly Progress (AYP) solely due to the performance of the students with disabilities subgroup to review their AYP calculations in light of this new rule. Since the new rule allows more appropriate assessments for students with significant cognitive disabilities, including out-of-level testing, NEA believes fewer schools will be inappropriately labeled.

NEA is pleased that the Administration has finally recognized how building much greater flexibility into the ESEA/"No Child Left Behind" education law is essential to improving overall student achievement and closing the achievement gap. These much-needed changes in assessing special-needs students were strongly urged by NEA, teachers, parents and many others across the country over the last two years.

NEA urges the Department to establish the same flexibility for states and schools in other areas of assessment, especially for English language learners, as well as for additional changes to the law to ensure that schools are not measured just on test results on one day.

Social Security offsets

The "Last-Day" - June 30, 2004

On December 9, 2003, the Senate approved the amended Social Security Protection Act (H.R.743). The bill included an NEA-opposed provision prohibiting educators from avoiding the Government Pension Offset (GPO) by transferring to districts covered by Social Security for as little as one day before retiring. The requirement is currently that educators spend only their 'last day' before retirement in a district covered by Social Security, and would change to require 60 consecutive months of Social Security covered employment. Currently retirees in non-Social Security districts - primarily in Texas and Georgia - were able to protect their Social Security spousal benefits from the GPO by working their last day prior to retirement in a district covered by Social Security. This change would take effect on June 30, 2004.

The original language would have set the cutoff on December 31, 2003, or 90 days from the date the bill became law. Senator Kay Bailey Hutchinson (TX) helped win the extension to June 30, 2004.

The Senate bill also allows a transition for employees who worked for five years in a school district that paid into both Social Security and the state retirement fund before H.R. 743 is enacted (most likely in late January 2004). These employees may count this service towards the five years. They must, however, work at least the final month before retirement in a Social Security District. The transition period expires on June 30, 2009.

The House passed an earlier version of the legislation in the spring of 2003 and is expected to pass the Senate version upon its return the week of January 20, 2004. The President will likely sign the bill into law shortly thereafter.

Punitive enforcement - A win!

Sec. 210 -- which would have made enforcement of the offsets even harsher -- has been stripped from the bill. This is a major victory for members who could be caught up in repaying benefits they received in good faith. Sec. 210 would have coordinated employer, IRS and Social Security reporting so that every individual eligible for a public pension -- from earnings not covered by Social Security -- could be tracked down and the offset applied. Affected retirees receiving Social Security benefits construed as 'overpayments' could have been liable to repay the federal government.

Among others, Senator Max Baucus (MT) and Representative Robert Matsui (CA) were helpful in removing this punitive provision from the bill.

Mandatory coverage - No end run

The Social Security referendum (requested by Kentucky after the City and County of Louisville merged) is limited to Kentucky. The state requested permission for state and local government employers to have the option of electing Social Security coverage for employees by majority vote in a referendum. All newly hired employees would be required to participate in Social Security. The Senate bill would have allowed all states to do this. NEA opposes mandatory Social Security coverage for all state and local employees.

Among others, Senator George Voinovich (OH) was helpful in amending the language to apply only to the State of Kentucky.

Repeal of Social Security offsets - A status report

Committee hearings were held for the first time this year in both the House and Senate. The committees, however, failed to act. NEA is now poised to implement a strategy to force action in 2004.

In the House of Representatives, a discharge petition signed by 218 House Members can move a bill out of committee and to the floor. Thanks to the hard work of member activists, the McKeon-Berman repeal bill (H.R. 594) now has 277 cosponsors -- some 60 percent of the House. The Feinstein-Collins Bill (S. 349), the Senate repeal bill, has 29 co-sponsors, more than double the number of co-sponsors last year. NEA will work with the cosponsors to move a discharge petition and force action to correct this penalty for public service. Stay tuned…

Funding

Up for a Senate vote on January 20, 2004 is the NEA-opposed catch-all funding bill, which shortchanges schools and includes private school vouchers for the District of Columbia.

12/4/03
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News from Capitol Hill...

Not 'your mother's government class'

The Last Act - Congress, in recess for an extended Thanksgiving holiday, returns the week of December 8 in a Grand Finale before adjourning for the year.

Unfinished business - Vouchers and funding!

No budget yet for this fiscal year that began October 1: The federal government continues to function under a series of temporary spending bills (Continuing Resolutions). The current Continuing Resolution runs through January 31.

"They Cooked Up a Turkey" -- Sen. Robert Byrd (WV): Negotiators finally managed to complete a catch-all (omnibus) package (H.R. 2673-H Rept. 108-401) for the budget year. The House is scheduled to vote December 8. The Senate may not vote until Congress returns in January.

NEA strongly opposes the omnibus package that:

• Diverts public funds to unaccountable private schools in the District of Columbia through taxpayer-funded vouchers. This isn't the civics and government you studied.
  
  The Senate never voted on the voucher program because the leadership lacked the votes for passage, yet the negotiators inserted vouchers for DC private and religious schools in the package.
  
  Further, provisions attempting to hold private schools to the same teacher quality and accountability standards as public schools were watered down or eliminated, even as Congress preaches accountability.

• Shortchanges critical education programs.
  The Message: Do More with Less. Title I programs for schools with large numbers of disadvantaged students are funded far below levels authorized in the ESEA/"No Child Left Behind" Act. Special education (IDEA) funding is about half the amount Congress approved only a few months ago in the budget blueprint.

• Fails to protect workers' rights -
  The agreement strips out Senate-passed language protecting the overtime rights of millions of workers.

Tell Congress: Reject this ill-conceived agreement! Craft a package that protects our nation's children and families.

The Medicare/prescription drug bill - A summing up

The NEA-opposed Medicare/prescription drug bill will continue to play out in the months ahead and be an issue in the '04 election.The House passed the bill, 220-215, after holding the vote open for an unprecedented two hours and 51 minutes - the longest roll call in its history - while the leadership worked to convince enough Members to support the bill. The Senate, after more than three days of heated debate, passed the bill 54-44.

NEA believes the final Medicare/prescription drug agreement overall reflects poor public policy that will exacerbate, rather than fix, the current health care crisis.

Drug costs will remain high

Medicare is prohibited from negotiating drug prices with the industry, so that the market power of more than 40 million beneficiaries cannot be used to lower their prescription drug costs.

The re-importation of less costly drugs from Canada and other countries is blocked.

Health Savings Accounts (HSAs) established for qualified medical expenses simply shift costs to the consumer, and do little to contain escalating drug costs.

A glaring gap in coverage

The benefit applies to drug expenditures up to $2,250. At that point, the coverage stops until beneficiaries have paid out-of-pocket the next $3,600.

Retiree health plans undermined

Private employers receive favorable tax treatment for health care expenditures at the expense of public -ector employers who are denied favorable treatment for contributions to retiree health care coverage. As a result, public-sector employers facing budget constraints may be pressured to drop retiree prescription drug coverage.

The agreement drops Sec. 631 that would have clarified that the coordination of employer-provided retiree medical benefits with Medicare (or a state plan) does not violate the Age Discrimination in Employment Act. Fewer pre-Medicare employees will be able to retire with the same employer-provided medical benefits they receive as active employees, and many may lose their employer-provided retiree medical benefits entirely.

The move to privatize medicare

In 2010, beneficiaries in "selected communities" will be given vouchers to purchase HMO/PPO or traditional Medicare coverage, in a test to determine whether private insurance plans are a viable alternative. The "demonstration plan," however, does not provide fair competition.

HMOs and PPOs will be given additional money to provide benefits and lower the cost of their premiums. Medicare, however, will not get these subsidies.

Medicare must accept all who wish to join. HMOs and PPOs, however, can choose not to market to the oldest and sickest because they are a major expense, leaving Medicare with the costliest patients and driving up the cost of Medicare premiums.