Today, HHS Secretary Tommy Thompson formally authorized states to begin a smallpox vaccination program for health care workers in hospitals across the nation. Workers who volunteer for smallpox response teams will be vaccinated so that they can provide critical services in the event of an attack. The HHS press release with all the details was posted today.

Last night, the Senate passed the long overdue spending bill four months into the new fiscal year. The $390 billion omnibus spending bill combined the 11 appropriations bills left over from the last Congress. The bill passed 69-29, with 19 Democrats joining 50 Republicans in supporting the measure. Sen. Peter Fitzgerald (R-IL) was the only Republican to oppose the bill. The legislation includes little spending from the nearly 250 amendments offered up by Democrats. Mitch Daniels Jr., director of the Office of Management and Budget, applauded the Senate for not exceeding the President's desired spending limit, by saying that senators "have successfully joined with the President in saving taxpayers billions in unnecessary spending". The Senate bill now heads to a conference committee, where senators and house members will work towards a compromise bill. For the full story, please refer to the article in the Washington Times.

As the Senate finishes work on the 11 appropriations bills left over from the previous Congress, both the President and leaders in the House continue to keep a close watch. The President has asked lawmakers not to exceed $390 billion in spending, but such a task will prove challenging when the bill heads to conference. In order to facilitate cuts to save money, the Senate amended the appropriations omnibus bill by adopting a 1.3% across-the-board cut to make room for education spending. This cut is in addition to the 1.6% across-the-board cut, which was already included in the text of the bill. According to Senator Ted Stevens (R-Alaska), chairman of the Senate Appropriations Committee, the 2.9% across-the-board cut might have to be reduced before passing the Senate or in conference with the House because of new cost estimates by the Senate Budget Committee. House appropriators reacted harshly to the additional across-the-board cuts, which were necessitated by increased spending on election overhaul and drought assistance. Even with the cuts, Senator Stevens still predicts that it will be hard to keep within the confines established by the President.

GOP Leaders had wanted a final bill on the President's desk by January 28th, in time for his State of the Union speech, but this seems very unlikely. However, getting the Senate omnibus bill passed by the end of the week and staying within the parameters set by the President would still be a major victory for new Senate Majority Leader Bill Frist (R-Tennessee).

In a brief amendment to an earlier post, the administration has reversed course and decided to reinstate the 'prudent layperson' rule it had abandoned a month earlier. Senator Graham's (D-Florida) vote was hours away and several senators and representatives from both sides of the aisle had expressed support for the rule as it stood before the administration's modification.

In the latest piece over on our analysis side of the website, we've got a review of Amtrak President David Gunn's meeting with the U.S. Conference of Mayors. Gunn discussed Amtrak's federal funding needs and had some interesting information about long-term capital projects as well as his preferred nomenclature for such works. For the full scoop, be sure to check out the entire piece. We'll be sure to keep everyone in the loop.

Senator Bob Graham (D-Florida) will soon introduce an amendment to the senate omnibus bill that would nullify a Bush Administration initiative on State Medicaid Coverage.

Late last year the administration told state officials that they could start to overlook a Medicaid provision from the Balanced Budget Act of 1997. The 1997 law offered more flexibility to states when administering Medicaid benefits. The Act allowed states to require that Medicaid patients obtain their health coverage from a managed care plan. However, there were safeguards instituted in the event that managed cared plan did not cut off certain medical services. One safeguard enacted was the requirement that Medicaid pay for emergency room visits and hospital stays resulting from emergency visits, if the private plans of Medicaid recipients did not cover such services, as long as a "prudent layperson" deemed the visit appropriate.

Currently, many states are dealing with massive budget shortfalls and have requested economic assistance from the federal government. To help the states save money, the administration has begun suggesting ways for states to circumvent Medicaid requirements. In a December 20 letter, the Center for Medicare and Medicaid Services wrote to state officials that the federal government would allow states to place new limits on emergency room care to "facilitate more appropriate use of preventive and primary care in outpatient settings".

Democrats have balked at the recent proposal by the Bush administration with Senator Graham taking the lead. His amendment would mandate that Medicaid continues to pay for emergency visits, even if certain managed care plans do not offer such services. Administration officials have claimed that the President wanted to offer more flexibility to states currently entrenched in fiscal crisis. Some states have even threatened to cut all Medicaid services if the federal government does not foot more of the bill for the federal-state program. The Bush administration has rejected any such idea.

Aides to Senator Graham would not speculate on support for his amendment or the chances of passage. Senator Graham is considered a potential Democratic presidential candidate for 2004.

Deadlines keep slipping as Senate Democrats offer more amendments and Republicans struggle to advance a $390 billion omnibus appropriations package.

The GOP goal is to get the fiscal 2003 measure into position for passage January 24th. Republican leaders and appropriators Tuesday night were poring over scores of amendments, including proposals to boost special education funding, to determine which they might modify or accede to in order to appease party moderates.

Votes are scheduled Wednesday morning on two amendments dealing with the implementation of Bush administration environmental rules. Republicans have a self-imposed deadline of January 28th - the day President Bush gives his State of the Union address - for passing the omnibus and completing conference negotiations with the House. But that goal no longer appears to be within reach.

Senate Appropriations Committee Chairman Ted Stevens, R-Alaska, said the Senate might complete its work on the measure by Jan. 24, at best, but that conferencing by Jan. 28 would be impossible.

Under pressure from Lincoln Chafee (R-R.I.), Susan Collins (R-ME), and Olympia J. Snowe (R-ME), and other Northerners, the Senate on Tuesday adopted, 88-4, an amendment that would add $300 million to the omnibus for the Low Income Home Energy Assistance Program (LIHEAP). The program helps elderly, disabled and low-income families pay their heating bills, and is popular in the states where winter hits hardest.

Senators voted down an amendment from John Edwards (D-NC) that would delay implementation of rules to ease pollution restrictions on coal-burning power plants and factories (50-46). They did vote in a counteroffer from James M. Inhofe (R-OK) that would require a similar study without delaying implementation of the rules (51-45).

Wednesday's floor action also could include consideration of competing proposals to provide assistance to drought-afflicted Western farmers and two more education funding amendments. One proposal, from Christopher Dodd (D-CT) would provide $1.5 billion in state grants for special education. The Individuals with Disabilities Education Act promised to reimburse states for 40 percent of the average per-pupil cost of educating disabled students. But the federal government has so far picked up 17 percent of the cost, which was $7.5 billion in fiscal 2002.

As drafted, the new Senate bill would increase the funding by $1 billion in fiscal 2003, the same amount as the Bush budget. The House voted to increase such funding by $500 million in its Labor-Health and Human Services-Education appropriations bill.

Republicans may seize on an amendment from Judd Gregg (R-NH) to counter Democratic charges that they are ignoring special education funding. The Gregg amendment would increase special education funding by $1.5 billion, but also require that a corresponding amount be slashed from a specific program in the omnibus measure or come from an across-the-board cut that would reduce funding by 0.4 percent for all programs in the legislation.

Gregg used a similar strategy on January 16th to defeat a Democratic amendment to boost education funding to low-income school districts by $5 billion. Democrats complained that Republicans in control of the Senate-House conference committee would disregard any funding increases that came as a result of corresponding budget cuts passed by the Senate.

Reed also has offered an amendment to extend federal unemployment benefits for 13 weeks to individuals who have exhausted their state and federal benefits and remain unemployed.

Mark Dayton (D-MN) has offered an amendment that would make winning federal government contracts harder for companies that incorporate overseas to avoid paying U.S. taxes. The amendment would allow the administration to waive government restrictions on contracts with those companies only if the president can demonstrate a national security need.

The Senate also could consider proposals to limit a data-mining program being developed by a division of the Pentagon that was largely responsible for the creation of the Internet. At least two amendments, proposed by Charles E. Grassley (R-IA) and Ron Wyden (D-OR) would limit further research on the program, known as Total Information Awareness. As envisioned, the program would allow the government to collect and analyze a broad array of information, such as criminal information and drivers' license data, from public databases.

The Bush administration "strongly opposes" raising the gasoline tax to pay for the amount of highway construction in the current Senate version of the omnibus appropriations bill.

As part of a comprehensive statement of administration policy on the spending bill released January 17th, the Office of Management and Budget (OMB) said the Senate bill "proposes an unsustainable level" of spending for roads. The Senate measure included $31.8 billion, which OMB said "breaks dramatically with the traditional linkage of highway spending and trust fund revenues."

That figure, which is $8.6 billion more than the administration requested, "would put the program on a path to an inevitable gas tax increase, which the administration strongly opposes," OMB said.

Until the announcement, the administration's stance on raising the gas tax had been one of the biggest questions surrounding this year's reauthorization of surface transportation programs. However, while OMB clearly opposes the concept of increasing the gas tax, advocates speculate that some in the Administration -- particularly within the Transportation Department -- have a different opinion. DOT officials have already identified significant funding needs for highways and transit.

The DOT has said to maintain and improve infrastructure over the life of the new bill, highway spending should increase to $61.2 billion in fiscal 2009 and mass transit spending should increase to $12.4 billion by then. Those programs currently are funded at $31.8 billion and $7.2 billion respectively.

The funding mechanism for highways and mass transit is going to be a key battle in the rewrite of the six-year surface transportation bill (PL 105-178), known as TEA-21. The measure expires September 30th. House Transportation and Infrastructure Committee Chairman Don Young (R-Alaska) has vowed to try to come close to the department's spending levels by increasing the gas tax by 2 cents annually.

Senate tax writers are less enthusiastic about a gas tax increase. Max Baucus of Montana, ranking Democrat on the Finance Committee, last week expressed little interest in increasing the gas tax.

The issue is sure to be one of the most contentious during the upcoming surface transportation reauthorization debate. We'll be sure to keep clients and friends up to date on the discussions.

According to the Wall Street Journal, Amtrak is quietly informing federal officials that they will require anywhere from $1.5 to $2 billion in funding next year to start addressing much overdue capital improvements on the heavily traveled Northeast Corridor. The Journal quoted Amtrak representatives as saying higher funding levels were necessary to fix tracks and bridges along the corridor. Also, it was reported that Amtrak would use the funds to purchase new cars and locomotives and to fix existing equipment. According to Amtrak, "the upgrades are necessary to reverse deterioration on the corridor and maintain it as a high-speed operation". Amtrak President and CEO David Gunn added that he would continue to ask for higher funding levels in the next five years.

Over the last few years, Amtrak has deferred much needed repairs and upgrades on equipment and infrastructure because of their deteriorating financial position. Since the Amtrak Reform and Accountability Act expired after the fiscal year of 2002, continued federal funding of Amtrak has not been a given. The provisions of this act mandated that Amtrak operate self-sufficiently after the authorization of federal funds ended in 2002. While Amtrak was granted a reprieve for 2003 by receiving federal funds to continue operations, the embattled rail corporation still required a bail out loan from the Transportation Department this past summer. Such a loan only forestalled debate over the future of Amtrak.

As the Senate considers the 11 appropriation bills leftover from the 107th Congress, Amtrak once again asked for $1.2 billion, more than double the amount of funds that was appropriated to them last year. Amtrak management said that the $1.2 billion would be necessary to keep the rail corporation running. However, the authorization of funds would only be earmarked for operations and not capital improvements.

Amtrak's heavy reliance on the federal government for operating costs will make their task of securing additional monies for capital improvements more cumbersome. While Senator Patty Murray (D-WA) lead the charge to pass an amendment to the Senate omnibus bill that would provide Amtrak with $1.2 billion for next year, such a victory is abridged because of the ensuing battles ahead. Just recently, Amtrak executives have said that a shortfall in appropriated funds for operating costs would force a shutdown of the rail corporation. It remains uncertain if Amtrak will employ the same tactics in seeking federal funds to cover capital costs.

Last week the Senate agreed to an organization resolution, which allowed the Senate to start work on an omnibus appropriations bill. Both houses already adopted a Continuing Resolution (CR) that funds the federal government at last year's spending levels until January 31. The Senate is debating a second omnibus bill that will eventually include the 11 individual appropriations bills not yet passed by Congress.

The earlier strategy to insert the 11 spending bills into the omnibus appropriations and preclude lengthy debate has fallen apart. The Senate originally intended to insert in the omnibus bill the results of months of negotiations between House and Senate staff on each of the 11 appropriations bills. Instead, the Senate focused only on its own version of bills adopted in committee last summer, reducing total expenditures by $13 billion in order to comply with House and White House spending targets. Each of the bills must still be conferenced with the House to reconcile spending priorities and individual earmarks requested by the members.

The Senate remains in session this week in hopes of completing action on the omnibus bill. However, numerous amendments to increase spending are being considered, creating the likelihood that Senate spending levels will exceed the amount acceptable to the White House. The House remains in recess until January 27. The earliest any conference committees could convene is that week.

Although no one is admitting it yet, Congress will probably have to adopt yet another CR to keep the government open while Congress engages in contentious conference committee sessions into February. Earmarks for specific projects might not be decided for weeks to come.

Today, before the Senate Government Affairs Committee, Tom Ridge began his confirmation hearings to become head of the newly created Homeland Security Department. In what is expected to only be a one day hearing, Ridge won praise as President Bush's Director of the White House Office for Homeland Security, which was created after the attacks of September 11, 2001.

Senator Susan Collins (R-Maine), in her first hearing as newly-selected chairwoman of the committee, while providing overall praise, asked Ridge not to overlook the 2 million state and local officials around the country on the front line of the war on terrorism, noting that the legislation creating the agency, "offers no assurance that the new department will coordinate and communicate effectively with state and local first responders."

The Senate Democratic Leader, Tom Daschle (D-South Dakota), wanted Ridge's assessment of the financial resources needed for the department to organize and carry out its mission. Yesterday, Senate Democrats, arguing that the administration had failed to provide the funds needed to meet the nation's increased security needs, unsuccessfully tried to add $5 billion for security-related programs to a $390 billion spending bill for this budget year.

The Homeland Security Department represents the largest federal reorganization since the Defense Department was set up in 1947. It will combine almost two dozen agencies with 170,000 employees in an attempt to better coordinate anti-terrorism efforts at home. Included in the new department will be Secret Service, Coast Guard, Customs Service, Immigration and Naturalization Service, Transportation Security Administration, Federal Emergency Management Agency, and the General Service Administration's federal protective services.

Ridge was elected to Congress in 1982 and was elected Governor of Pennsylvania in 1994. After the September 11th attacks, President Bush asked Ridge to head the then new White House Office of Homeland Security. He won a Bronze Star for valor in the Vietnam War.

As promised, we've got a more in-depth roundup of the late-night amendments, whether they passed or not, and their impact on the omnibus spending package winding it's way through the Senate. It appears that the total spending is not going to meet the administration's self-imposed cut-off, due to several proposed amendments and earmarks. Be sure to check often for the latest Peyser analysis of ongoing legislation.

In one of several amendments to be tacked on last night to the omnibus spending package in the senate, Patty Murray (D-WA) proposed that Amtrak funding be increased to $1.2 billion from $762 million. It passed by voice vote, and along with other amendments helped bring the current cost of the bill to more than $390 billion. The omnibus is on track to break the $750.5 billion target the administration had sought for fiscal 2003. More on the other amendments and their fates shortly.

Today in Scranton, PA, President George W. Bush renewed his call for Congress to impose the first federal restrictions on malpractice cases, saying that "broken" medical liability system is driving away doctors and increasing the cost and availability of health care. Today the President urged Congress to enact legislation limiting awards for pain and suffering to $250,000 and to curb punitive damages as well.

The President first proposed an overhaul of medical-liability system last summer. The House passed legislation along the lines the president wanted, but the measure stalled in the then Democratic-controlled Senate. With the Senate now in Republican control, the prospects might be better. Democrats and trial lawyers have resisted changes in malpractice laws, saying that patients need legal recourse when they are harmed by reckless doctors.

The President stated that this is a national problem that can not be addressed solely by state governments. Typically, states set their own malpractice guidelines.

Although he wasn't invited to the event with President Bush, Gov.-elect Ed Rendell (D) was scheduled to hold a news conference shortly after the President's noon speech in which he was expected to call on Bush to raise Medicare and Medicaid payments for doctors and hospitals. Rendell spokesperson Ken Snyder said award caps will take years to implement: "We need solutions that will take months".

From up on the Hill, a couple updates to pass along. The FY2003 omnibus spending bill is moving along now, with a few defeated amendments in its path, including a Democrat sponsored amendment which would have boosted homeland security spending by $5 billion. It was defeated 45-51. The GOP Leadership met earlier to encourage members to vote down all Democrat-sponsored amendments in the hopes of adhering to the administration's request to keep spending to $751.3 billion. The latest amendment would have provided money to first-responder grants, and security at many transportation locations including airports and ports.

Also, according to CQ, the House and Senate are somewhat divided on the idea proposed by Representative Don Young (R-Alaska) to increase the federal gas tax by $.02 annually and raise other revenue sources in order to expand the federal highway trust fund to $60 billion. Outgoing Finance Committee chairman (now senior Democrat) Senator Max Baucus, (D-Mont.) is opposed to raising taxes to increase the size of the fund, although he too wants to enlarge it. One method to do so would be to allow the fund to earn interest and to distribute that money to the states. As work on TEA-21 progresses, we'll be sure to update our clients and friends.

After a lengthy standoff, both sides in the Senate have agreed on funding levels that will allow the Senate to now organize properly. Committee funding will reflect the close split of the chamber, much like last year's agreement, although the Republican committee chairmen will gain an additional 10% for "administrative expenses". This represents a compromise between the Democratic assertion that the money reflect the 51-49 split and the Republican position that the majority party should get 2/3 of all funding. Business can now start to be taken up in the Senate, although the delay has pushed back the timetable on several initiatives.

There are a number of political nuggets to pass along this morning, from both inside the beltway and from far beyond. We'll begin with the president's falling poll numbers and then move on to Mississippi and finish with the state of Washington.

Yesterday, the Gallup New Service released polling information which showed that President George W. Bush's approval rating has dropped below the 60% level for the first time since the attacks on September 11, 2001. The poll showed a 58% approval rate and a 39% disapproval rate. After the attacks, his approval skyrocketed reaching a record 90% in mid-September 2001. It has been gradually declining since.

The most recent drop may be related to the controversy over North Korea's nuclear weapons capability. In a poll conducted a week ago, the President had a 60% foreign affairs approval rating. That rating is now 53% with 42% of Americans disapproving of the way he is handling foreign affairs. The seven-point drop in foreign affairs approval is nearly equal in size to the five-point drop in Bush's overall approval rating. In contrast, the President's economic ratings have shown no change from last week, thus leading to the implication that foreign affairs is the reason for the President's declining ratings.

Meanwhile, the current head of the Republican National Committee, Haley Barbour, confirmed in a letter that he'll be running for governor of Mississippi in the fall against incumbent Democratic Gov. Ronnie Musgrove. Barbour ran unsuccesfully for a Senate seat in the 1980s, and the race is expected to cost several million dollars according to both sides.

And finally, in Olympia, Washington, Democratic Governor Gary Locke has been chosen to deliver the Democratic Party's response to the President's State of the Union address on January 28th. Locke was chosen by Minority Leader Tom Daschle (D-SD) because he wanted the response to be delivered by a governor. Locke currently chairs the Democratic Governors Association and provided the Democratic response to one of the President's radio addresses in 2001.

In an interesting manuever, Senator John Edwards (D-NC) has managed to keep his seat on the Senate Judiciary Committee by trading his position on the Commerce Committee to Maria Cantwell (D-WA). Both stand the benefit from the switch, with Edwards keeping a high-profile position to attack the administration's judicial nominees, and Cantwell gaining an influential voice on technology issues important to the state of Washington.

In other committee news on the Democrat side, Senator Lautenberg (D-NJ) was denied his attempt to return to the Environmental and Public Works Committee, where he formerly served as chairman. He picked up a seat on Commerce, Governmental Affairs and Small Business, instead. The only other incoming Democratic Senator, Mark Pryor (D-AR), notched assignments on the Armed Services, Governmental Affiars and Small Business committees.

The only three other changes for the Democratic caucus were Evan Bayh (D-IN) and Hilary Clinton (D-NY) joining Armed Services and Jon Corzine (D-NJ) joining Foreign Relations.

Over on the analysis side of the website, we've just posted a look at S.104: The National Rail Defense Act, proposed by Senator Fritz Hollings (D-SC). It's similar to S.1991, from last year, with a few modifications to reflect changes in the new Homeland Security Department. The act would increase funding to Amtrak, eliminate the self-sufficiency agreement and authorize money for high speed rail routes and security upgrades. It would also require that Amtrak have an independent financial consultant review its methods of cost accounting, and to help create an annual five-year financial plan to be overseen by the Department of Transportation's Inspector General.

Yesterday, Connecticut Senator Joseph I. Lieberman joined the Democratic field running for President in 2004. The Democratic field already includes Senator John Kerry of Massachusetts, Senator John Edwards of North Carolina, former Vermont Governor Howard Dean, and former House Minority Leader Richard Gephardt. Other Democrats who are said to be considering running include Senator Bob Graham of Florida and New York Civil Rights Activist Al Shapton.

Senator Lieberman announced yesterday at his old high school in Stamford, Connecticut that he would run for the Presidency in 2004. In his announcement, Lieberman stated, "We must rise above politics and restore independence to the White House, not compromise our economic or environmental or health secruity for political contributors or extreme ideologies. We must rise above partisan politics and stand up for our values here at home, because family and faith and responsibility matter more than power and partisanship and priviledge."

The addition of three term Senator Joe Lieberman adds the most conservative Democrat to the presidential field. A founding member of the centrist Democratic Leadership Council, the spring board for former President Bill Clinton's successful run in 1992, Senator Lieberman has co-sponsored the Senate resolution authorizing President Bush to use military action to disarm Iraq, supports the limited, experimental use of vouchers to provide public funds for private school tuition; and touts a pro-business voting record.

Senator Lieberman ran with former Vice President Al Gore on the Democratic ticket in 2000. The unsuccessful Gore/Lieberman ticket won the popular vote and received more votes than any other Democratic ticket in history.