Congress closer to reaching budget deal before Friday deadline

Monday - 12/12/2011, 9:00am EST

By Jolie Lee
Federal News Radio

Congressional negotiators are closer to reaching a spending deal with less than a week left before the current budget expires.

Lawmakers have "narrowed their differences" on a more than $1 trillion bill that cuts nearly 10 percent in nondefense appropriations since the new Congress took over, Politico reports.

The Pentagon will get a $5 billion increase to cover everything except direct war spending.

In the 2012 fiscal year, which started Oct. 1, Congress has passed only three of the 12 appropriations. Lawmakers now want to push through an omnibus bill containing appropriations for the remaining nine bills.

But what's hindered reaching an omnibus agreement are "riders" attached to the bill.

Sen. Ben Cardin (D-Md.) told Federal News Radio last week that the spending level has been agreed upon — but it's the addition of these riders that have become the "major problem."

The Hill's Erik Wasson told Federal News Radio two spending bills have become "the thorniest" and possibly sticking points to passing an omnibus — funding for the Environmental Protection Agency and funding for the departments of Labor and Health and Human Services. Politico reports EPA can expect $300 million in new cuts.

Congress is also wrangling with how to extend the payroll tax cut. Both parties want the extension but can't agree on how to pay for it. House Republicans want to extend the federal pay freeze through 2013 and change the annuity calculation from the high-three to the high-five. The Senate twice rejected a similar bill that used federal employees' pay to fund the payroll tax extension.

Politico reports the debate on the payroll tax will likely be taken up after the Friday deadline to reach a spending deal.

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