Congress Prepares for Year-End Legislative Sprint

By Kristina Peterson Features Dow Jones Newswires

Lawmakers returning to Washington face a tight calendar and a dizzying list of legislative tasks, from a major tax overhaul to a new federal spending agreement, with the added complication of sexual harassment allegations that are reverberating in the halls of the Capitol.

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For weeks, the political spotlight has focused on Republicans' efforts to pass the first major revision of the tax code in more than three decades. After failing in their push to dismantle the Affordable Care Act earlier this year, GOP lawmakers are counting on the tax rewrite to mark one major legislative accomplishment they can tout to voters in next year's midterm elections.

The Senate could vote on its version of the overhaul this week after the House recently approved its own bill. GOP leaders say they expect the two chambers to hash out an agreement on one bill before year's end.

But the tax bill's passage could be affected by the outcome of other, lower-profile negotiations, most notably over where spending levels should be set for the remainder of fiscal year 2018, which ends Sept. 30. Once a budget deal has been reached, lawmakers will then need a few weeks to fill in more detailed spending legislation.

Because the government's current funding expires after Dec. 8, lawmakers and aides expect Congress will have to pass a short-term spending patch that would stretch for just two or three weeks until a longer-term spending bill is completed.

President Donald Trump is expected to meet with leaders of both parties in both chambers Tuesday to discuss legislative priorities, aides said. GOP leaders have advised lawmakers they may remain in Washington until close to Christmas, or beyond, to finish the tax bill and other legislation.

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At the same time, allegations of sexual misconduct by Sen. Al Franken (D., Minn.) and Rep. John Conyers (D., Mich.) as well as the release of a nude photograph of Rep. Joe Barton (R., Texas) -- all of which happened in a matter of days -- suggest that claims of sexual misconduct may continue to jolt Capitol Hill.

The closely watched election for the Alabama Senate seat vacated by Attorney General Jeff Sessions also takes place Dec. 12, pitting GOP candidate Roy Moore, who faces accusations of sexual misconduct toward teenage girls, against Democrat Doug Jones. A GOP loss would narrow the Republicans' Senate majority to 51-49. In either outcome, GOP leaders hope to pass the tax bill before the next Alabama senator is sworn in.

Most immediately, one pressing challenge for GOP Senate leaders is that the Republicans who control swing votes on the tax bill have goals that could be almost impossible to reconcile in a spending bill needed to keep the government funded next year. With a slim 52-48 majority in the Senate, Republican leaders can afford to lose no more than two GOP votes on the tax bill, with Vice President Mike Pence prepared to cast a tiebreaking vote.

At least three GOP senators have expressed concerns over the $1.5 trillion the tax bill is expected to add to the federal budget deficit over 10 years, to pay for the cost of lowering the corporate tax rate and many individuals' income-tax rates. The negotiations over the spending limits could add to those concerns, and potentially turn them off the tax bill, since congressional leaders have been discussing increasing government spending over the next two years by around $200 billion.

"We're $20 trillion in debt and it's 'party like there's no tomorrow' time in Washington," said Sen. Bob Corker (R., Tenn.) on Twitter recently in response to articles about the spending negotiations. GOP Sens. Jeff Flake of Arizona, who is retiring next year, and James Lankford of Oklahoma also have expressed concerns about the tax bill's impact on the federal deficit.

Without a budget deal, spending levels would revert to lower levels established in 2011. Under current law, regular military spending is capped at $549 billion for fiscal year 2018, while nonmilitary spending is capped at $516 billion.

That has upset Sen. John McCain (R., Ariz.), who has said Congress must increase military spending. Mr. McCain hasn't directly connected his vote on the tax bill to the level of military spending, but several aides say they believe angering him over military funding could make it harder to get his support for tax overhaul.

"This era of forcing our troops to do more with less must come to end," Sen. McCain, who is chairman of the Senate Armed Services Committee, said in a statement with his House counterpart, Rep. Mac Thornberry (R., Texas).

Republicans are divided on whether to balance military spending increases with a cut to nonmilitary spending, to minimize the effect on the deficit. "We don't have a good track record on finding cuts," said Rep. Dave Brat (R., Va.). "That's the swamp." But Sen. Lindsey Graham (R., S.C.) said Sunday on CNN that he would be willing to increase nonmilitary spending to secure a boost for the military.

Democrats have said any boost to military spending should be matched with a comparable increase on the nonmilitary side. Democratic votes are likely to be needed in both chambers for the spending bills to pass, giving them leverage.

GOP leaders are likely to have a much easier time selling the year-end spending bill to Republicans if they have already passed the tax overhaul.

"If you get tax reform, it provides everybody a little bit of breathing room to move forward on some things that may not be your favorite," said Rep. Mark Walker (R., N.C.), chairman of the Republican Study Committee, a group of about 150 House Republicans. Without a tax bill, "it'd be very difficult," he said.

An added complication to the final spending bill is the fight over how to handle illegal immigrants who were brought to the U.S. by their parents at a young age, known as Dreamers. Mr. Trump ended a program protecting them, but gave Congress until early March to figure out how to handle the issue. GOP leaders have said they want to handle immigration in separate legislation, but Democrats may use their leverage in the spending bill to demand that the protections be included.

Sen. Dick Durbin (D., Ill.) signaled that Democrats would support some tightening of border security, although Republicans may push for more stringent immigration measures that cause Democrats to balk.

"We believe that there are aspects of border security that Democrats and Republicans can agree on," Mr. Durbin said on CNN, but said he would oppose steps that would treat young immigrants like "second-class citizens."

--Ian Talley contributed to this article.

Write to Kristina Peterson at kristina.peterson@wsj.com

(END) Dow Jones Newswires

November 26, 2017 12:40 ET (17:40 GMT)