Ted Cruz Threatens To Subpoena Treasury Over Obamacare Subsidies

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May 28, 2015 11:10 am
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Sen. Ted Cruz (R-TX) is threatening to subpoena Treasury Department officials if they continue to refuse to testify before his Senate subcommittee about Obamacare subsidies.

The subpoena threat comes after Treasury declined to make the officials available, citing ongoing litigation on Obamacare subsidies. The case of King v. Burwell is currently pending before the Supreme Court, with a decision expected in June on whether Obamacare subsidies are available through the federal exchanges.

The Internal Revenue Service, which is within the Treasury Department, wrote the rules which interpreted the Affordable Care Act to allow subsidies to be provided to those who obtained health insurance through the federal exchange. That interpretation is at the heart of the dispute in King v. Burwell.

In a letter sent to Treasury Secretary Jack Lew Wednesday — as reported by Roll Call — Cruz threatened to use Congress’ “compulsory process” if Assistant Secretary for Tax Policy Mark Mazur, Deputy Assistant Secretary for Tax Policy Emily McMahon and Deputy Tax Legislative Counsel for Tax Policy Cameron Arterton do not voluntarily appear to testify in front of the Judiciary Committee’s Subcommittee on Oversight, Agency Action, Federal Rights and Federal Courts in a hearing scheduled for June 4.

According to the letter, Sandra Salstrom, the agency’s deputy assistant secretary for legislative affairs on tax and budget issues, told Cruz’s staff this week that the three officials would not be allowed to attend the hearing, which will be about the role federal employees played in federal subsidy rule-making process, as the subject is related to ongoing litigation surrounding the law. Cruz called Salstrom’s reasoning “entirely invalid.”

“First, Congress retains its right to conduct oversight of the executive branch at all times, regardless of any perceptions of poor timing by, or inconvenience to, the executive branch,” Cruz said in the letter. “The Senate Judiciary Committee has obligations to ensure the proper functioning of the federal government at all times, and not just during windows of convenience for political officials. Second, your Department’s pending litigation justification is without basis, particularly given how you have provided at least one Department witness for the exact same topic during the pendency of other litigation over the last few years.”

The letter said that if the department did not confirm the officials’ attendance at the hearing, they could “be summoned for testimony at any time deemed convenient for the Committee.”

Cruz’s office told TPM Thursday morning that it had not yet received a response from the Treasury Department.

The full text of the letter:

May 27, 2015
The Honorable Jacob Lew
Secretary
U.S. Department of the Treasury
1500 Pennsylvania Avenue, NW
Washington, D.C. 20220


Dear Secretary Lew:

I am writing today regarding the Treasury Department’s refusal to supply key witnesses for an upcoming Senate Judiciary Committee oversight hearing about the Patient Protection and Affordable Care Act’s (PPACA) exchange subsidy rulemaking process. This refusal is unacceptable and interferes with Congress’s and this Committee’s obligation to ensure proper functioning of federal agencies and the federal rulemaking process.

Last Thursday, May 21, 2015, my staff contacted your Department and requested the appearance of Assistant Secretary for Tax Policy Mark Mazur, Deputy Assistant Secretary for Tax Policy Emily McMahon, and Deputy Tax Legislative Counsel for Tax Policy Cameron Arterton at a planned oversight subcommittee hearing, currently scheduled for Thursday, June 4. Our understanding, based on prior congressional oversight efforts,[1] is that these three current federal employees played instrumental roles in the drafting and implementation of PPACA’s exchange subsidy rule.[2] Given the significant questions that remain unanswered about the mechanics of the rulemaking process that led to this rule, their input, and therefore presence and testimony at the hearing, is considered essential.

Yesterday, Tuesday, May 26, my staff had a conversation with Sandra Salstrom, Deputy Assistant Secretary for Legislative Affairs on tax and budget issues, who informed my staff that your Department would not be permitting Mr. Mazur, Ms. McMahon, or Ms. Arterton to testify at that hearing. The excuse provided by Ms. Salstrom was that your Department would not make these (or presumably other relevant) witnesses available for testimony because of pending litigation on the subject. For two main reasons, this excuse is entirely invalid.

First, Congress retains its right to conduct oversight of the executive branch at all times, regardless of any perceptions of poor timing by, or inconvenience to, the executive branch. The Senate Judiciary Committee has obligations to ensure the proper functioning of the federal government at all times, and not just during windows of convenience for political officials. Second, your Department’s pending litigation justification is without basis, particularly given how you have provided at least one Department witness for the exact same topic during the pendency of other litigation over the last few years.[3]

I am reiterating my request for your Department to voluntarily make Mr. Mazur, Ms. McMahon, and Ms. Arterton available for congressional testimony at our planned oversight hearing on June 4. If you do not opt to assist Congress and make all three individuals available voluntarily, I may have no choice but to pursue other options, including compulsory process, to make them available for testimony. Please note, in the event we are compelled to use compulsory process to ensure the attendance of these witnesses, the two-week courtesy notice prior to testimony is no longer applicable, and these individuals can be summoned for testimony at any time deemed convenient for the Committee.

Please contact my office to confirm attendance of the above witnesses for June 4 or if you have any additional questions.

Sincerely,

Ted Cruz
Chairman
Subcommittee on Oversight, Agency Action,
Federal Rights and Federal Courts

cc: The Honorable Charles E. Grassley
Chairman
Senate Committee on the Judiciary

The Honorable Patrick J. Leahy
Ranking Member
Senate Committee on the Judiciary

The Honorable Christopher Coons
Ranking Member
Subcommittee on Oversight, Agency Action,
Federal Rights and Federal Courts

[1] See generally H. Comm. on Oversight and Government Reform and H. Comm. on Ways and Means, Joint Staff Report, Administration Conducted Inadequate Review of Key Issues Prior to Expanding Health Law’s Taxes and Subsidies (Feb. 5, 2014).

[2] See generally Health Insurance Premium Tax Credit, 77 Fed. Reg. 30,377 (May 23, 2012).

[3] While it is true that the United States Supreme Court is expected to render its decision in the King v. Burwell case before the end of the Court’s present term, nothing that is said in the public domain could properly impact the litigation because it would not be part of the record before the Court. In terms of the claim that your Department does not allow witnesses to testify on issues that are the subject of pending litigation, that claim is demonstrably false. Your Department specifically allowed Ms. McMahon to testify before the House Committee on Oversight and Government Reform on July 31, 2013, during the pendency of Halbig v. Sebelius, on virtually identical subject matter. See Complaint, Halbig v. Sebelius, 1:13-cv-00623-RWR (D.D.C. May 2, 2013); H. Comm. on Oversight and Government Reform, Subcomm. on Energy Policy, Health Care, and Entitlements, Oversight of IRS’ Legal Basis for Expanding ObamaCare’s Taxes and Subsidies (Jul. 31, 2013). Ms. McMahon provided detailed discussion of the relevant subject matter in her written hearing testimony. Seegenerally Written Testimony of Emily S. McMahon, Deputy Assistant Secretary for Tax Policy, U.S. Department of the Treasury, before the House Oversight and Government Reform Subcommittee on Energy, Health Policy [sic] and Entitlements (Jul. 31, 2013).
First, Congress retains its right to conduct oversight of the executive branch at all times, regardless of any perceptions of poor timing by, or inconvenience to, the executive branch. The Senate Judiciary Committee has obligations to ensure the proper functioning of the federal government at all times, and not just during windows of convenience for political officials. Second, your Department’s pending litigation justification is without basis, particularly given how you have provided at least one Department witness for the exact same topic during the pendency of other litigation over the last few years.[3]

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