National Election Results Create Opportunities for Progress on Issues Important to the Lodging Industry
(November 7, 2014) The midterm elections have shifted the balance of power in Washington DC, with Republicans gaining the majority in the Senate with at least 53 seats and adding more than a dozen seats in the House. While some races across the country are still undetermined and could add to this Republican majority, it is important to note that the Republicans will now govern the Senate by a narrow margin – which could prove to be a challenge in achieving the 60-vote threshold often needed to advance legislation.
President and CEO of the American Hotel & Lodging Association (AH&LA) Katherine Lugar issued a statement on the election results, calling on Congress to quickly address key issues facing the nation, including passing the Terrorism Risk Insurance Act (TRIA), which provides a vital backstop for businesses should they fall victim to a terrorist attack.
“Now that Election Day is over, Congress should immediately get to work tending to unfinished business. Members on both sides of the aisle should commit to passing sensible policies that foster economic development, promote job growth and empower small businesses, a growing segment of the hotel industry. Before recessing for the year, the House of Representatives should pass TRIA, bipartisan legislation that promotes stability and job growth across many sectors. The Senate passed this bill by a vote of 93-4, sending a clear message to Speaker Boehner and Minority Leader Pelosi about the strength and force of this legislation. The House of Representatives must move swiftly to pass TRIA before it expires at the end of December.”
The new Senate Republican Majority, combined with a larger House Republican Majority, will significantly alter the policy landscape for the business community and the lodging industry. First, it is expected that both the House and the Senate will focus on oversight of Administrative actions on matters like immigration, implementation of the Affordable Care Act, Department of Labor and National Labor Relations Board (NLRB) regulations. There is also likely to be more cross-collaboration between House and Senate Republicans to illustrate that Congress can indeed govern and get things done. For example, both House and Senate leaders plan on passing a budget in 2015, which will provide a roadmap and some certainty to the process of funding the government this coming year.
Accomplishing this legislative progress is easier said than done, however, given the dynamic of a more conservative House, a Senate with a significant number of Republicans from swing states up for reelection in 2016 (of the two dozen Senate Republicans up for reelection, 7 are running in states that Obama carried in 2012), and a President who will be focused on protecting his “legacy” issues. Nevertheless, some smaller, targeted measures are likely to get to the President’s desk and be signed into law.
In a recap of the significance of the election for the lodging industry, AH&LA outlined its expectations of the following issues:
Labor: With Congress’ new focus on oversight of the Administration, we believe this agenda will include added Congressional scrutiny over the recent NLRB decision on joint employer and other onerous labor related regulations and expected overtime regulations. Additionally, there is the possibility of a minimum wage debate occurring, particularly in the Senate, as 2016 in-cycle members in competitive states wish to take this issue off the table and forge a compromise.
Healthcare: We anticipate that the new Congress will vote on another repeal of the Affordable Care Act and follow that with action on smaller bills to change burdensome and unworkable parts of the law. Legislation to change the definition of full-time from 30 to 40 hours is at the top of the list, as well as a delay or repeal of the employer mandate.
BrandUSA: Negotiations continue on the reauthorization of BrandUSA, the public-private partnership created in 2010 to help attract millions of new international visitors and promote the United States as a premier travel destination. With the House passing its reauthorization legislation on such a strong vote this past summer, and the Senate already moving companion legislation through the committee process, the prospect of BrandUSA reauthorization being achieved is promising- likely by adding it to another legislative vehicle such as the continuing resolution or omnibus appropriations bill Congress must pass in December to keep the government funded.
Immigration: While it was expected that the President would issue an executive order in the coming weeks that would address undocumented workers, the results of the election could alter the President’s thought process. Any executive action on immigration will undoubtedly cause a negative reaction from House and Senate Republicans and would dampen prospects for Congressional action on immigration. That said, both House and Senate GOP leadership have expressed an interest in potentially tackling this issue in 2015 and we could see some smaller targeted actions to “fix” the executive order or address enforcement and/or business concerns later in the year.
The new Republican majority may also make it more difficult to have oversight over achieving a level playing field with the short-term rental marketplace and underscores that a state and local strategy is critical.
Additionally, there were several states that had minimum wage ballot initiatives up for a vote on Election Day: Alaska ($9.75), Arkansas ($8.50), Nebraska ($9), and South Dakota ($8.50). Due to heavy Democratic and organized labor turnout efforts, all four initiatives passed and will be adopted over the next several years.