Budget talks move ahead; House GOP considers agreement likely, but Democrats see snags; 'We're still not there'; Bargaining remains for bills on spending, Medicare, tax credits


WASHINGTON -- After weeks of contentious negotiations, the Republican leaders of Congress expressed confidence last night that they would be able to strike a deal with the White House on a new federal budget and adjourn for the year by next week.

Bargaining on several remaining spending bills, in addition to proposals for boosting Medicare payments to health care providers and restoring expiring tax credits, was described as nearing completion -- though Democrats warned that many snags remain.

"It could come quickly, but we're still not there," said Sen. Pete V. Domenici, a New Mexico Republican who is chairman of the Senate Budget Committee.

House Majority Leader Dick Armey sparked shouts of protests when he told House members to return to Washington tomorrow after Veterans Day celebrations in their districts today. Republican leaders hope a deal can be struck by negotiators today that House members could approve tomorrow.

The Senate is not scheduled to return to Washington until Tuesday, although lawmakers who are taking part in the negotiations are expected to work through the weekend.

Senate Majority Leader Trent Lott predicted last night that Congress would adjourn Wednesday.

'Pretty much worked out'

"Everything is pretty much worked out, or it's not going to be," Lott said.

House leaders have been especially frustrated by the difficulty in resolving differences not only with the White House but also with their Senate colleagues. Several individual senators have been holding spending bills hostage until their demands are met on unrelated issues.

Part of the reason House leaders insisted that their members return tomorrow is to prevent tentative agreements from unraveling over a long weekend.

"We figure, why wander away and come back to find new concerns have cropped up?" said John Feehery, a spokesman for House Speaker Dennis Hastert. "Let's just get the bills done."

Democrats less optimistic

Democratic leaders said they were less optimistic about the prospect that all the remaining disputes could be resolved in time for the House to vote tomorrow.

"My guess is that Armey will put out the word sometime [today] that House members don't have to come back until Monday," said Rep. Steny H. Hoyer, a Southern Maryland Democrat and senior member of the House Appropriations Committee.

Five of the 13 spending bills that are required to finance the government for the fiscal year that began Oct. 1 have yet to be enacted. Many government agencies have been operating on temporary spending bills.

Congress passed and President Clinton signed a fifth temporary bill yesterday that will keep those agencies operating until Wednesday.

Most of the money issues in the spending bills have been settled, aides said, with agreement near on about $2.4 billion in spending that was added at Clinton's insistence.

But the negotiators have yet to find a way to finance that spending without violating their vow not to dip into the Social Security surplus.

Objection to spending cut

The White House also objects to a nearly 1 percent proposed cut in most spending for next year, which Republicans approved to try to save $3.75 billion. To restore that cut, an alternative revenue source would have to be found.

That leaves negotiators with a total gap of about $6 billion to fill before their work is done.

In addition, disputes remain over several policy issues, although the two sides agreed last night to continue Clinton's effort to hire 100,000 teachers over seven years, the Associated Press reported. Clinton had requested $1.4 billion for the program; the negotiators settled on $1.325 billion.

Under the agreement, school districts could use 25 percent of the program's money for teacher training and other education programs, the AP reported. Republicans have wanted school districts to have flexibility to use some of the money for purposes other than hiring teachers.

U.N. programs debated

Another unresolved issue stems from a long-running disagreement over family planning programs run by the United Nations.

The president says he is determined to begin paying America's overdue U.N. dues. But some Republicans want assurances that the money won't be used to promote abortion.

Talks were also under way to deal with Sen. Robert C. Byrd's effort to overturn a federal court ruling that would block new permits for mountaintop coal mining in his home state of West Virginia.

But as of yesterday, the senior Democrat had not secured an agreement to attach that provision to any of the spending bills.

Medicare negotiations

In addition to the spending bills, the lawmakers were negotiating over an $11 billion proposal to restore some of the cuts made to Medicare in 1997.

Those cuts proved so damaging that some hospitals, nursing homes and other Medicare providers are being driven out of business.

On a third front, negotiators were working last night to produce a five-year, $21.5 billion tax bill that would extend the life of some popular tax credits that are about to expire.

Included in that measure is a five-year extension of tax credit for research and development. Also included is a provision to exempt families who take the $500-per-child tax credit from the alternative minimum tax, which is triggered if total tax payment drops below a certain threshold.

Clinton, who vetoed a Republican tax-cut bill that would cost $792 billion over 10 years, has not endorsed the new tax measure. But Republican leaders are hopeful that he will, noting that the bill includes items important to him and to Vice President Al Gore's presidential campaign.

Another item expected to be included in the smaller tax-cut bill is a $50 million tax credit for businesses that convert chicken manure to electrical power.

A British company is prepared to build such a power plant on the Delmarva Peninsula if the tax credit goes through. Sen. William V. Roth Jr., a Delaware Republican who is chairman of the Senate Finance Committee and is facing a tough re-election race next year, is trying to get the chicken manure tax credit enacted as part of the tax bill Congress is expected to pass before it adjourns.

"As it stands, it's still in there," Lott said.

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