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Sifting Through Details of the Deal

Lawmakers Assess Gains and Losses In Stimulus Package

A copy of the final legislation hashed out between House and Senate conferees.
A copy of the final legislation hashed out between House and Senate conferees. (By Susan Biddle For The Washington Post)
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By Shailagh Murray and Paul Kane
Washington Post Staff Writers
Friday, February 13, 2009

As the House prepared to vote on a $789 billion stimulus bill, lawmakers and aides combed through the massive document, searching for favorite provisions and discovering that some didn't make the final cut.

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A tax break that would allow businesses to deduct operating losses, one item on President Obama's wish list, was pared back to cover only small companies. Multiple spending provisions -- from $300,000 for a Justice Department program to fight violence against women to $65,000 for a watershed construction project -- were dropped altogether.

But other items in the legislation, which both the House and the Senate are expected to vote on today, would receive huge federal boosts. Broadband investment totaling $7.2 billion would target poor and rural areas. The Department of Homeland Security would receive $1 billion to upgrade airport baggage and checkpoint screening. In a victory for rail advocates, the bill includes $9.3 billion to develop high-speed trains and to improve Amtrak.

House and Senate Democratic leaders battled over several measures, notably school-construction funding, and struggled to produce a written bill a full day after Senate Majority Leader Harry M. Reid (D-Nev.) announced that a deal had been struck.

House Speaker Nancy Pelosi (Calif.), along with many other House Democrats, was disappointed that the final package more closely resembled the Senate's bill than the House's spending-rich package. But she called the legislation "historic and transformational" for its investments in Democratic social priorities.

"Let's just say it was a success," Pelosi told reporters. "The bill that goes forth is one that we're all very, very proud of, that has bipartisan support, at least in the Senate. And I believe that, because the president wanted swift, bold action to turn the economy around, we had to move in an expeditious way."

Despite the brokered deal, confusion reigned in the Capitol's hallways. With no text circulating 30 hours after Reid's announcement, Senate Minority Leader Mitch McConnell's office sent out a half-joking e-mail to reporters last night making light of Democratic accusations that Republicans were blocking the legislation -- since none yet officially existed.

Lawmakers had warned of the complications involved in drafting such a large bill in such a short time. Earlier versions had nearly 800 pages. When House and Senate negotiators sat down Wednesday evening to formalize an agreement, their aides wheeled in drafts of the bill on a cart. That version was dated Feb. 9, before the Senate centrist compromise that gutted more than $100 billion from the legislation.

Piles of paper, bound by metal clips, sat next to the old drafts, representing the new versions of the legislation.

Even the process of holding a House-Senate conference was a bit awkward. Sen. Daniel K. Inouye (D-Hawaii), chairman of the Appropriations Committee, tried to convene the meeting at 3:30 p.m., but, as Pelosi acknowledged yesterday, House Democrats were furious that Reid had announced the deal without a final okay from the other side of the Capitol.

House Democrats were particularly incensed that language relating to school construction had been eliminated -- along with nearly $20 billion in funds -- and that governors would be restricted to paying for school renovations and repairs out of a $54 billion pot of money that included other education projects.

The bill does address other Democratic policy priorities that had languished during years of GOP control. Public housing provisions total nearly $10 billion. Nearly $15 billion would go to clean-water and environmental protection projects. Minus the construction money, education programs would receive nearly $100 billion in new funding, including $12 billion for special education, boosting the federal share for education services to the highest level ever, according to the Senate Appropriations Committee.

The bill would make a significant down payment on Obama's health-care and energy agendas. It would provide nearly $20 billion to adopt uniform medical-records technology, portrayed as a job-creating exercise and part of the foundation for broader health-care reform. It also includes more than $40 billion for energy-efficiency programs and new energy technologies, including $11 billion to upgrade the national electricity grid.

Individuals who have lost their jobs during the ongoing recession would receive health-care and unemployment assistance. The bill would provide a $20 billion increase in the food stamps program and $2.1 billion to expand Head Start.

On the tax side, the bill calls for a two-year $400 credit to working individuals and $800 to working couples, distributed through a payroll tax deduction or claimed as a lump sum for the 2009 and 2010 tax years. Social Security recipients would receive a one-time $250 payment. College students and home and car buyers would receive incentives, although the latter two benefits were drastically reduced.

One of the largest tax provisions, a $70 billion fix to the alternative minimum tax, was inserted into the bill to assure the provision's quick passage. Lawmakers are eager to prevent the tax -- intended to target upper-income taxpayers -- from encroaching on middle-class families. Given the grim fiscal picture, lawmakers worried about securing passage of the fix later this year.



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