Anxious Marylanders wait to see if Congress will act

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WASHINGTON — — Failure of the congressional "supercommittee" to strike a deal on deficit reduction has left lawmakers scrambling to address a half-dozen bills of major importance to Marylanders, from extending tax breaks to paying Medicare doctors to securing federal money for roads near military bases.

Before the end of the month, a bitterly divided Congress must decide whether to keep paying unemployment benefits that 14,300 out-of-work Maryland residents collect and whether to continue a payroll tax cut received by 2.6 million wage earners in the state. Funding for the Bethesda-based National Institutes of Health is up in the air, as is a provision to bring more money to the state to defray costs from the federal base realignment, or BRAC.

Many of the issues could have been settled by the 12-member bipartisan supercommittee charged with cutting the nation's budget deficit, which was $1.3 trillion last year. But because the panel collapsed last month under partisan pressure, Congress must now move a series of high-profile bills in the next few weeks or face the prospect of a government shutdown and an economy made even worse by their inaction.

It's a familiar place for Congress, which has lurched from one fiscal crisis to another this year. But this time, a breakdown on many of the issues would have an immediate impact on voters.

"We have certain must-dos, and one, of course, is extending unemployment benefits for those people who are actively looking but can't find work," said Sen. Barbara A. Mikulski, a Maryland Democrat. "That's a No. 1 issue."

Marylanders collecting unemployment exhaust their state benefits after 26 weeks and then must shift to two federally funded programs, one that lasts for 47 weeks and another that extends payments for an additional 13 weeks. New funding for both must be approved by the end of the year to avoid running out of cash.

"I kind of don't sleep too well at night. I toss and turn thinking about it," said David DiCarlo, a 45-year-old Owings Mills resident who was laid off from his mortgage broker job in March and who would lose unemployment benefits if lawmakers don't extend them.

"I didn't really think it was going to be a big deal, to be honest," he said of losing his job. "I thought I'd be off for a month."

Proponents say extending benefits provides a big boost to the economy at a time when unemployment is high — the Labor Department on Friday put the jobless rate at 8.6 percent. Maurice Emsellem with the National Employment Law Project said that letting benefits lapse would "be devastating to Maryland's economy."

While there is broad support for an extension in Washington, lawmakers are divided along party lines over how — and whether — to pay for the one-year, $44 billion price tag. In the past, Congress has agreed to extend benefits without offsetting the cost, but that would be tricky now that the path to cutting the national debt is unclear.

"This is a painful decision," said Rep. Roscoe G. Bartlett, a Western Maryland Republican. "But in a situation like this, you can't do everything you would like to do. Without offsets, I think it would be very difficult for me to vote to extend unemployment benefits."

A series of spending bills to keep the government running through next year is another priority for lawmakers. Many provisions tucked into those bills could have a direct impact on Maryland, but their outcome is uncertain because they are handled differently by the House and Senate.

With current funding for the government set to expire Dec. 16, the time left to work out those differences is slipping quickly.

The Bethesda-based National Institutes of Health, for instance, would receive a $1 billion increase in funding next year under a House spending plan but would see about a $200 million cut in the Senate's. The agency, a driver of the Maryland economy, received $30.7 billion in the most recent fiscal year.

"Things are very much up in the air for NIH," said Jennifer Zeitzer, legislative director for the Federation of American Societies for Experimental Biology. "We are hopeful that we have flat funding if not a small increase."

House and Senate bills also differ on how the federal government will reimburse Maryland and other states for road construction required to handle additional traffic caused by the military base realignment. Reconciling those differences could affect the commute for drivers around Aberdeen Proving Ground in Harford County and Fort Meade in Anne Arundel County.

The Pentagon helps pay for road improvements around a base expansion only if traffic is expected to double on that road because of the expanded facility. Rep. C.A. Dutch Ruppersberger included language in the House version of a sweeping defense bill that would eliminate that requirement and also create a dedicated fund to pay for transportation improvements.

"We have so many jobs coming, but one of the things we don't want is people working for us in this BRAC process having to sit in cars for two hours," the Baltimore County Democrat said. "We also don't want to negatively impact our existing neighborhoods."

But the provision is not included in the version of the bill the Senate passed Thursday. Lawmakers hope to work out the differences. Broadly, the legislation authorizes money for troops, weapons and the Iraq and Afghanistan wars.

Seniors and their doctors, meanwhile, are united in support of perennial legislation to delay cuts in Medicare payments to physicians. The annual cuts were initiated in 1997 to limit the growth of Medicare costs, but Congress has regularly delayed them. This year, payments to doctors would fall by 30 percent if Congress does not act by the end of the month.

"We would have to consider whether we could even see Medicare patients," said Adam Weinstein, who runs a nephrology practice in Easton that cares for about 5,000 patients, 75 percent of whom are on Medicare. "It's sort of unfathomable the depths of the problems it would cause."

Weinstein, who has been in business for six years, says doctors' concern is not just for their own salaries, although he acknowledges his pay would fall. He said a major reduction in Medicare rates would force him to trim costs across his practice, from staff salaries to the Internet service.

And while it may not be practical for a doctor to stop seeing Medicare patients altogether, it is often possible to stop taking on new ones.

"It's basic economics," said Gene M. Ransom III, chief executive officer of MedChi, which represents more than 22,000 Maryland doctors. "If you lower the price of something, there's going to be less supply."

And that concerns seniors, too.

"There's a dearth of qualified geriatric positions in Maryland now, and if you cut Medicare rates, you're going to have fewer and fewer," said Ted Meyerson, president of United Seniors of Maryland.

But a one-year delay of the cuts costs $12 billion, according to the nonpartisan Congressional Budget Office.

Among the most expensive issues lawmakers will wrestle with this month are a handful of tax breaks that must either be extended or allowed to expire. That includes exempting millions of taxpayers from the Alternative Minimum Tax at a cost of $85 billion. The AMT was originally intended to target the wealthy but now would fall on the middle class as well if Congress doesn't act.

Democrats, led by President Barack Obama, also want to extend a 2 percentage point reduction in the payroll tax that Congress approved last year. The reduction, which affects virtually all workers, will expire at the end of the year.

For Maryland, the more important issue may be how an extension is paid for. Senate Republicans last week suggested finding the money to pay the tax break by freezing federal employee salaries and trimming the government workforce by 200,000 people.

"That would easily wipe out the benefit of payroll tax reductions in Maryland," said Anirban Basu, head of the Baltimore economic consulting firm Sage Policy Group.

Basu said he believes there are logical compromises to be found on most of the issues facing Washington this month. Whether lawmakers will actually find that middle ground — particularly with next year's presidential race heating up — is another matter, he said.

"Congresspeople in the past would have worked it out," he said.