GOP May Tie Debt-Limit Increase to Veterans Bill

By Richard Rubin, Nick Timiraos and Kristina Peterson Features Dow Jones Newswires

Republicans are considering tying a must-pass increase in the federal debt limit to funding for a program that lets military veterans get medical care outside of Veterans Affairs facilities, people familiar with the idea said.

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The legislative move, still in the early stages of discussion on Capitol Hill, would let Republicans claim a policy victory while raising the federal borrowing cap.

The federal government has already hit the debt limit, which had been suspended until March and was then reset at $19.8 trillion. The Treasury Department is using so-called "extraordinary measures" or emergency cash-conservation steps, to pay the government's bills for now. The government's ability to use those tools is expected to run out in early-to-mid-October, according to the Congressional Budget Office.

The Treasury Department's cash balance, however, could drop to very low levels in early September, which this spring prompted warnings about potentially raising the debt limit before the August congressional recess.

Without an increase, the government would start missing promised payments, such as interest on the national debt, paychecks for federal workers and benefits for recipients of Social Security and other programs. The administration has urged Congress to act quickly.

The debt-limit vote is often challenging for lawmakers. Although the vote merely allows the government to pay the bills stemming from past spending and tax decisions, it can appear to voters and political opponents like a vote for more debt.

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The upcoming debt-limit vote will be the first once since March 2006 with Republicans in control of the House, Senate and White House. Raising the limit will bring little joy for Republicans, many of whom want to tie spending cuts or other fiscal restraints to the debt limit.

As a result, the debt limit is likely to be attached to other must-pass legislation or to something like the veterans bill that is politically popular.

House Veterans Affairs Committee Chairman Phil Roe (R., Tenn.) said Friday he could see the logic of pairing the veterans bill with raising the debt limit, traditionally a tough vote for many Republicans.

"You know how this place works: You always stick something people love onto something people hate," Mr. Roe said. "Obviously something that has to be done -- that's what we always do to get the debt ceiling" raised, he said.

Mr. Roe noted that GOP leaders hadn't discussed with him the idea of pairing the bills.

Congress created the Veterans Choice program in response to long wait times for medical care at VA facilities.

President Donald Trump signed legislation earlier this year that eliminated an Aug. 7 expiration and extended authorization for the program until it runs out of the $10 billion that Congress put in the program in 2014. That account was down to $821 million in mid-June, Veterans Affairs Secretary David Shulkin told a Senate committee.

Mr. Shulkin said then that the program will "dry up by mid-August" without the ability to transfer money from one VA account to another. That could create pressure on Congress to act before the August recess.

Congressional leaders haven't announced their plans for the debt limit, though Senate Majority Leader Mitch McConnell (R., Ky.) has delayed the chamber's August recess by two weeks, and said the debt limit was on the legislative agenda for that period. They are expected to seek an increase that is large enough to avoid having another vote before the 2018 election.

Orrin Hatch (R., Utah), the chairman of the Senate Finance Committee "is working with the administration to get more details on what the appropriate time will be for Congress to act to raise the debt ceiling and is continuing to work with his colleagues in Congress to find a viable path forward to achieve this goal," said his spokeswoman, Julia Lawless.

Kate Davidson contributed to this article.

Write to Richard Rubin at richard.rubin@wsj.com, Nick Timiraos at nick.timiraos@wsj.com and Kristina Peterson at kristina.peterson@wsj.com

(END) Dow Jones Newswires

July 14, 2017 13:02 ET (17:02 GMT)