By Kristina Peterson, Andrew Duehren and Richard Rubin
WASHINGTON -- Senate Democrats struck a last-minute agreement
Friday to set federal unemployment benefits at $300 a week, down
from the $400 passed by the House, but extend their duration by a
month as part of the $1.9 trillion coronavirus relief package,
according to a Democratic aide.
The federal jobless benefits, which are in addition to state
benefits, would now extend through September, instead of August. In
addition, the first $10,200 of the benefits wouldn't be taxable,
the aide said. The changes will be made through an amendment from
Sen. Tom Carper (D., Del.).
The developments came as the Senate on Friday braced for an
hourslong marathon of amendment votes on the relief package
expected to stretch into Saturday morning ahead of the bill's final
passage.
The blitz of amendments, known as a vote-a-rama, stood as the
last hurdle between Democrats and Senate passage of President
Biden's relief plan. Democrats are using a special process tied to
the budget to pass the package without any GOP support, with Vice
President Kamala Harris casting the tiebreaking vote.
The last-minute changes to unemployment benefits capped a week
of alterations made by Senate Democrats to accommodate their 50
members, who must be united in order to pass the bill.
"It defies common sense to have a cliff in the middle of August
when you've got the Senate out of session," said Sen. Ron Wyden
(D., Ore.), chairman of the Senate Finance Committee. "I have
personally felt that the benefit should be $400, it should
certainly run into September, but I know some of my colleagues feel
otherwise," Mr. Wyden said.
It wasn't immediately clear how the tax break would line up with
the current tax filing season, given that IRS computers are
programmed to see this income as taxable and some people have
already filed returns with unemployment benefits as taxable income
on them.
The new agreement also extends limits on how high-income users
can deduct certain business losses. Those limits, created in the
2017 tax law, were suspended by last year's coronavirus relief law,
to the frustration of progressive Democrats. They are now in effect
but are scheduled to expire in 2025 like other pieces of the 2017
law. The Democratic plan would generate revenue by extending the
provision through 2026.
The relief bill also provides $1,400 direct payments to many
Americans, sends $350 billion to state and local governments, funds
vaccine distribution, and expands the child tax credit, among other
measures. The package advanced on a procedural vote Thursday with
the support of all 50 members of the Democratic caucus and no
Republicans.
Once it passes the Senate, the bill will return to the House,
which will need to approve the altered bill again before sending it
to the White House. Liberal Democrats had pushed to keep the
unemployment benefits at $400 a week and weren't expected to be
pleased with the Senate's changes. House leaders can lose no more
than four House Democrats if all Republicans oppose the bill, as
they did in the previous vote.
Senate Democrats are using a process known as reconciliation,
which allows them to pass legislation tied to the budget with just
a simple majority, rather than the 60 votes most bills require. But
because the process allows the majority party to pass legislation
on their own, Senate rules carve out a place for lawmakers in the
minority to make their voice heard, by allowing them to vote on an
unlimited number of amendments. In practice, lawmakers generally
get tired in the early hours of the morning and agree to wrap up
the amendments, before voting on final passage.
"There will be a lengthy amendment process as the rules of the
Senate require," Senate Majority Leader Chuck Schumer (D., N.Y.)
said on the Senate floor Friday. "The Senate is going to take a lot
of votes, but we are going to power through and finish this bill
however long it takes."
Senate Minority Leader Mitch McConnell (R., Ky.) said Democrats
had assembled a wish list of liberal priorities that weren't needed
as the economy improves. But he said GOP lawmakers would try to
alter the bill during the amendment votes.
"Republicans have many ideas to improve this bill," he said on
the Senate floor. "And we're about to vote on all kinds of
amendments in the hopes that some of these ideas make it into the
final product."
Many of the amendments expected on Friday and Saturday are
designed to force lawmakers from the other side of the aisle to go
on the record on a contentious political issue. Sen. Tom Cotton
(R., Ark.), for example, said he would offer an amendment to block
prisoners from receiving the direct checks.
Others give lawmakers a chance to demonstrate their support for
a policy.
Senate Budget Committee Chairman Bernie Sanders (I., Vt.) said
Friday he would offer an amendment on increasing the minimum wage
to $15 an hour, a plank of the bill passed by the House, but
stripped out of the Senate version when the chamber's
parliamentarian ruled it didn't comply with the rules.
Senate Democrats were divided on the $15 minimum wage increase,
with Sens. Joe Manchin of West Virginia and Kyrsten Sinema of
Arizona opposed to including it in the legislation. The amendment
isn't expected to pass.
The amendment votes started later than otherwise planned because
Sen. Ron Johnson (R., Wis.) forced the Senate's clerks to read the
entire 628-page bill, which stretched from 3:21 p.m. Thursday until
2:04 a.m. Friday. That added time to the process because it didn't
count as part of the official debate time, split between the two
parties.
Democrats made a series of last-minute alterations to the bill
this week, largely to satisfy the demands of centrist members of
their caucus.
They narrowed the group of Americans who will receive direct
payments following a push from a group of centrist Democrats.
Senate Democrats added a provision that would make much
student-loan forgiveness free from income taxes, creating an
exception from 2021 through 2025 to the normal rule that canceled
debt is income. They increased the size of healthcare subsidies for
laid-off workers.
Write to Andrew Duehren at andrew.duehren@wsj.com and Richard
Rubin at richard.rubin@wsj.com
(END) Dow Jones Newswires
March 05, 2021 11:39 ET (16:39 GMT)
Copyright (c) 2021 Dow Jones & Company, Inc.