House Democrats will take a key procedural step on Monday toward moving their $1.9 trillion coronavirus relief package.
Budget Chairman John Yarmuth, D-Ky., has scheduled a 1 p.m. markup to staple together the reconciliation submissions from nine House authorizing committees before sending the measure onto its last stop before the floor, the Rules Committee.
Rules is where the substantive changes will occur, including the likely necessary step of bringing the combined package into compliance with its overall $1.89 trillion limit under the fiscal 2021 budget resolution. The nine committees have so far approved pieces the Congressional Budget office has tallied up to $1.95 trillion.
That figure would appear to remain more or less intact after accounting for small pieces three additional panels will submit next week — Foreign Affairs, Natural Resources and Science — and backing out duplicate provisions approved last week by different committees that share jurisdiction. It's also possible the numbers could shift a little based on interactions between multiple committee proposals.
House Democrats are seeking offsets to bring the combined cost back down, according to a source familiar with the process who spoke on condition of anonymity.
The Budget panel's top Republican, Jason Smith of Missouri, said in a statement the “process has been so hasty and partisan that it would be no surprise if problems with their approach continue to emerge.”
It wasn't immediately clear how added costs would be accommodated. But one place to look for offsets could be tax increases House Democrats included in two aid bills that passed that chamber last year before dying in the GOP-controlled Senate.
That includes extending limits on tax losses that owners of noncorporate businesses, like partnerships and S corporations, can apply against other income, as well as capping net operating loss "carrybacks" that firms could use to get refunds on prior tax bills. Those provisions would have raised a combined $254 billion in the two big relief bills House Democrats passed last year that died in the GOP-controlled Senate.
On a call with reporters Thursday, Rep. Pramila Jayapal, D-Wash., leader of the Congressional Progressive Caucus, said progressives were continuing to push for eliminating those breaks, either in the Senate or as part of separate legislation.
Unemployment insurance, pensions
Alternatively, existing funds in the package could be carved back a little to reduce costs. But House Democrats are already taking heat because the Ways and Means recommendations would cut off enhanced unemployment benefits on Aug. 29, a month earlier than President Joe Biden and Senate Finance Committee Chairman Ron Wyden, D-Ore., have sought.
While praising the overall package, the left-leaning Center on Budget and Policy Priorities this week criticized the unemployment benefit cutoff, which would occur during the August congressional recess. “The August timing makes a benefit lapse, which would hurt families and disrupt states’ ability to administer jobless programs, likelier,” the group said.
Renewing enhanced federal unemployment benefits after their March 14 expiration through Aug. 29 and increasing the federal supplement from $300 to $400 per week would cost $246 billion, according to the CBO. Ways and Means' overall ceiling was $940.7 billion over a decade, and they came in at $930.1 billion including the unemployment provisions, the CBO said.
The Committee for a Responsible Federal Budget, a nonpartisan watchdog group, criticized House Democrats for ending the unemployment benefits early in part to make room for a long-sought rescue of union pensions, such as a major Teamsters plan, that are headed toward insolvency.
“The financial status of these [pension] funds shouldn’t be addressed in a piece of crisis legislation, and certainly not at the cost of benefits for unemployed workers,” CRFB President Maya MacGuineas said in a statement. “Frankly, no member of Congress should be willing to defend this.”
Douglas Holtz-Eakin, president of the right-leaning American Action Forum, piled on the criticism of the pension proposal Thursday, calling it a “grotesque bailout” that does not belong in a pandemic relief package. Holtz-Eakin, a former CBO director, testified before the Senate Banking Committee on Thursday.
Those provisions, which would cost nearly $82 billion, weren't part of Biden's coronavirus aid proposal but have strong backing from Democrats in both chambers. Similar legislation has been in several iterations of Democratic virus aid proposals, an aide to Ways and Means Chairman Richard E. Neal pointed out.
Democrats keep pitching fixes for the "multiemployer pension crisis because it has only gotten more dire as the pandemic has raged on," said Dylan Opalich, a spokesperson for Neal, D-Mass. "Not to mention, some of those affected are currently on the frontlines of this crisis, keeping our food supply chains going. This is our chance to meet the moment and simultaneously help Americans facing both short- and long-term consequences from COVID."
And, Opalich added, the package doesn't preclude further aid in subsequent legislation: "Delivering the relief they need doesn't mean the work stops there."
Another item that is adding to the House bill's price tag is legislation that would raise the $7.25 an hour federal minimum wage to $15 in stages over five years, which the CBO said would cost $67 billion over a decade. Jayapal made it clear that the minimum wage language was a top priority for progressives in the aid bill.
"It is really important to us that it happens in this package because we think it is directly related to COVID relief," she said. "I don't think we're pivoting to any other strategy. We're very focused on getting it into this package."
The Senate's "Byrd rule" has been the main obstacle so far, since minimum wage legislation has long been considered primarily a nonbudgetary matter and a business mandate that typically is excluded from reconciliation bills. The reconciliation process affords lawmakers the ability to circumvent a Senate filibuster, and the rules named for the late Sen. Robert C. Byrd, D-W.Va., are intended to prevent overuse of reconciliation.
But progressives including Senate Budget Chairman Bernie Sanders, I-Vt., point to new CBO forecasts taking into account much broader budgetary impacts than in the past, and show no signs of backing off despite Biden himself saying the minimum wage boost probably can't make it through the Byrd rule.
Democrats have been considering adding a package of small-business tax breaks in the Senate as a sweetener, though that decision appears to be on hold until there's a parliamentary ruling on minimum wage.
'Substantive revisions' to wait
In the meantime, the House first needs to get a bill over to the Senate, which will be a lengthy process next week in its own right.
Under a 1974 budget law, the Budget panel can't make any “substantive revision” to the reconciliation package. Instead, any desired or necessary changes would be made by the Rules Committee.
Budget panel members can't offer amendments, but they can offer nonbinding motions to instruct Yarmuth to advocate for certain policies at Rules. That process also affords Republicans an opportunity to score political points they otherwise wouldn't be able to make.
In 2017 when Republicans, who were in the majority at the time, were trying to repeal the 2010 health care law and replace it with a stripped-down version, Budget Democrats offered seven motions to instruct designed to inflict political pain.
For example, one motion would have instructed Republicans to push for an amendment to "strike all provisions in the bill that reduce the number of Americans with health insurance coverage, increase costs, or reduce benefits for poor and middle-class households," while also striking "tax breaks in the bill for the wealthy, health insurance companies and their executives, and pharmaceutical companies."
Republicans offered a handful of their own motions to instruct, including one several Democrats backed that would have urged support for targeting tax credits for insurance coverage to "the population they are intended to serve."
For additional coverage and documents related to the House reconciliation bill, see here.
David Lerman, Lindsey McPherson and Doug Sword contributed to this report.