The House passed legislation Tuesday to extend agency operating budgets at current levels for another six weeks, as congressional leaders worked behind closed doors to shape a longer-term deal that could dramatically boost discretionary spending across the government.
The House vote was 245-182 on the temporary spending bill, which would also provide a full year’s worth of Pentagon appropriations as well as a package of health care funding extensions. There were 17 Democrats backing the measure, while eight Republicans opposed it.
But the real work was taking place behind the scenes on a massive budget agreement that would prevent a partial government shutdown after the current stopgap expires at midnight Thursday and provide certainty for federal program managers and stakeholders for two years.
Lawmakers and aides said Tuesday that negotiators were close to a deal that would raise discretionary spending caps by upwards of $300 billion over two years, and provide billions of dollars more for nondefense programs that are outside the constraints of the caps.
Senate Majority Leader Mitch McConnell, R-Ky., told reporters Tuesday he was “very optimistic” about striking a spending caps deal, expected to cover fiscal years 2018 and 2019.
“I think we’re on the way to getting an agreement and getting it very soon,” McConnell said.
Republican and Democratic staff with knowledge of the talks said it’s possible, but not assured, a deal could be reached as early as Tuesday and attached to the House-passed stopgap spending bill Wednesday or Thursday.
“I’ve discussed some of the outlines with my caucus that I think we are very happy with, and hopefully the Republicans are. And then we can get something really good done,” Senate Minority Leader Charles E. Schumer, D-N.Y., told reporters Tuesday. “We are making very, very good progress in achieving parity” between increases for domestic and defense programs, Schumer said, which has been a major sticking point in the talks.
Rep. Mark Walker, R-N.C., said his understanding was a deal could be unveiled as early as Tuesday evening. GOP Sens. David Perdue of Georgia and Richard C. Shelby of Alabama said they’d been told a deal was likely to be announced either Tuesday or Wednesday.
Debt Limit In Play
If an agreement is reached on caps, it is also likely, but not a given, the Senate will attach a debt limit suspension to the stopgap. Any changes would then have to be approved by the House again, before the current continuing resolution expires after midnight Thursday.
“The debt ceiling is something that some would want to ... see as part of this deal. We’ll see what happens. Nothing has been agreed to on that,” Schumer said.
The House spending package, introduced Monday night, was attached in that chamber as an amendment to unrelated bill. It contains a smattering of health care-related provisions that would increase mandatory spending on net by $11.9 billion over five years, although over a decade the bill’s offsets produce a net savings of $327 million, according to the Congressional Budget Office.
Senators were also discussing the addition of several tax provisions, including a fix to last year’s tax overhaul that would help independent grain companies benefit from a new 20 percent business income deduction.
“I’m not sure what will be required to get the requisite number of votes here or if there’s some modification we may send back,” said Senate Majority Whip John Cornyn, R-Texas. “I know they continue to have discussions on the spending caps, so I’m hoping that dam will break and we can get a lot of this overdue business taken care of.”
As of this weekend, negotiators were considering raising the defense cap by $80 billion in fiscal 2018 and perhaps $85 billion in fiscal 2019, with the nondefense cap rising by $63 billion in 2018 and possibly more in 2019. Republicans were pressing to keep the nondefense cap at $63 billion in the second year, a person with knowledge of the talks said.
Though Democrats have insisted on parity or equal increases in the defense and nondefense caps, Democratic staff said they might be willing to accept smaller increases in the nondefense cap in return for new or higher funding for Democratic priorities that are funded on the mandatory side of the budget.
Adding new money for efforts to prevent opioid abuse, several more years of funding for community health centers, more funding for the Veterans Administration, a loan program to avoid cuts to multiemployer pension plans, disaster relief aid, and an agreement to provide security for undocumented “Dreamers” brought to the U.S. illegally as children all have been under discussion as items to attach to a caps deal.
Unlike the past two cap-raising deals, negotiators have not been able to find a way to completely offset the discretionary spending increases through cuts or changes to mandatory programs. A person with knowledge of the talks said less than 50 percent of the increase in discretionary spending would be offset.
House Watches, Waits
It wasn’t immediately clear if House Democrats, or conservative House Republicans, would be on board with the emerging Senate agreement.
“The rumor is the Senate will put a caps agreement on that bill,” House Minority Whip Steny H. Hoyer, D-Md., told reporters Tuesday, referring to the House stopgap measure.
If there is such an agreement it will likely include Senate and House priorities with both Schumer and House Minority Leader Nancy Pelosi, D-Calif., involved in the negotiations, Hoyer said.
Nonetheless Hoyer would not commit to House Democrats’ reaction.
“I’m going to wait to see what the Senate does before I say whether we’ll vote for or against,” he said, while noting that the spending caps “are our leverage” to secure a commitment for a floor debate on immigration similar to what McConnell has pledged in the Senate.
Similarly, Pelosi would not comment on the ongoing discussions about a spending caps deal. “Well I hope we’re close, but we’ll see,” she said off the House floor on Tuesday.
Reaching an agreement on the Deferred Action for Childhood Arrivals program is still on the table as something that could be resolved as part of the caps deal, a Democratic aide said.
Schumer brushed off the idea that House Democrats may not vote through a spending caps agreement without a DACA deal in hand.
“I’ve been working very closely with Leader [Nancy] Pelosi. I talk to her all the time and I think we are working from the same page,” Schumer said.
Schumer also downplayed Trump’s comment Tuesday that Democrats would prefer another government shutdown to an immigration deal that also includes border security measures.
“It speaks for itself,” Schumer said. “We had one Trump shutdown. Nobody wants another except him.”
Also complicating matters was the fact that House conservatives are not enthusiastic about some of the big dollar figures being bandied about as part of a budget deal. Walker, who is chairman of the Republican Study Committee, said members have concerns about voting for large nondefense spending increases.
Jennifer Shutt, David Lerman, Kellie Mejdrich, Patrick Kelley, Lindsey McPherson and Joe Williams contributed to this report.