By CongressDaily staff
© National Journal Group Inc.
Monday, Sept. 24, 2007

With the end of the fiscal year looming Sunday and lawmakers nowhere near completion of the appropriations process, the House and Senate this week will consider a continuing resolution to fund government operations. At the same time, the chambers will also look to send President Bush a compromise State Children's Health Insurance Program bill and the Senate will attempt to finish the FY08 defense authorization measure.

With both chambers targeting Nov. 16 to adjourn for the year, it appeared late last week the CR would run through that date, although Senate Majority Leader Harry Reid, D-Nev., continues to hold the door open for returning in December to complete unfinished business.

If the Senate completes the FY08 Defense appropriations bill next week after an intense, drawn-out battle over the Pentagon authorizing measure, that would make five of 12 Senate spending bills approved in that chamber.

The House has passed all 12, but none of them have been conferenced, meaning the CR will have to cover every Cabinet department and smaller agencies.

It will also likely have to carry extensions of current law for expiring programs that Congress has yet to reauthorize, as well as some interim funding authority for the Pentagon to continue military operations in Iraq and Afghanistan.

Senate Appropriations Chairman Robert Byrd, D-W.Va., announced late last week a Wednesday hearing on the administration's latest supplemental funding request, at which Defense Secretary Robert Gates, Deputy Secretary of State John Negroponte and Gen. Peter Pace, chairman of the Joint Chiefs of Staff, are expected to testify.

The White House request already totals $150 billion, almost entirely for the Pentagon, and is expected to send to Capitol Hill an amendment adding as much as $50 billion more, again largely for the military but with a smaller piece for State.

Congressional aides expect the amended request to reach Capitol Hill early this week, in advance of Wednesday's hearing.

But it remains unclear when either the House or Senate will actually begin to move the request through the legislative process, as Democrats are still wrestling with a strategy for ending the U.S. involvement.

The Iraq war funding issue is likely to dominate attention for the foreseeable future. In the meantime, talks on domestic spending will continue if there is any hope that Democratic leaders will be able to adjourn before Thanksgiving.

OMB Director Jim Nussle has been quietly making the rounds, meeting with key lawmakers in both chambers, as Democrats and Bush have a $23 billion gulf separating them on the regular FY08 appropriations bills.

Bush has threatened to veto bills that exceed his requests, and while Senate Republicans have sent mixed signals about their willingness to support Bush on spending, House Republicans have thus far largely demonstrated they are in lockstep with the White House on upholding his promised vetoes.

However, this summer no House Republican proposed to cut Labor-HHS spending by $3.6 billion below the current year as Bush has requested, so some adjustments at least in that area are likely.

A big test of House GOP spending unity, which could have implications for the appropriations fight later this fall, is likely to come this week as the House and Senate send Bush an expansion of SCHIP that exceeds his request by $30 billion.

The legislation would add $35 billion to the children's health insurance plan, with votes scheduled in both bodies before the program expires Sunday.

The SCHIP votes probably will not be the last Congress sees of the measure. The president has said he will veto it, and lawmakers expect to offer a stop-gap extension as the White House and congressional Democrats begin their face-off over a longer-term bill.

The House vote, expected Tuesday, will mark the second time members have voted on an SCHIP expansion. A broader, $50 billion bill passed the House on near party lines in July. It included a Medicare package that House leaders say will be considered later this year. (See related story, bottom of page 1.)

The bill closely mirrors a Senate-passed bill that was carefully negotiated among Republicans and Democrats on the Finance Committee. The measure, worked out among House and Senate leaders, adds dental coverage for low-income children, which was not in the Senate bill.

The bill also "replaces" a letter to states from the Centers for Medicare and Medicaid Services that imposed new restrictions on states seeking to expand SCHIP eligibility above 250 percent of the federal poverty level, according to a summary.

The provision would phase in requirements for low-income coverage that states must meet in order to cover children above 300 percent of the poverty level.

A 61-cent per-pack increase in the cigarette tax is used to fund the SCHIP expansion, which could cause heartburn for some House members, who chafed at a 45-cent increase under the earlier House bill.

With the absence of controversial cuts to Medicare, several dozen moderate Republicans who voted against the measure in July are likely to support the bill this time around.

In the Senate, the bill is likely to maintain the veto-proof margin it had in the summer. Drafters of the Senate bill also say they intend to vote to override Bush's veto. In the House, a veto-proof margin would be a heavy lift, supporters admit.

Meanwhile, after losing two bids last week to set a deadline for pulling most U.S. troops out of Iraq, Senate Democrats are expected to offer a compromise proposal this week they hope will attract Republican votes.

Senate Armed Services Chairman Carl Levin, D-Mich., said Friday he would work through the weekend to craft language that will likely not include a mandated withdrawal deadline but still would force the Bush administration to dramatically alter its Iraq war policy.

If a compromise can be struck, that language will be offered this week as an amendment to the FY08 defense authorization bill, which has become a battleground for Democrats intent on ending the war and bringing U.S. troops home.

The effort to find a middle ground on the Iraq war comes on the heels of the defeat Friday of an amendment offered by Levin and Sen. Jack Reed, D-R.I., that would have required the withdrawal of all but a residual force from Iraq 90 days after the bill's enactment.

In an effort to reach 60 votes, Levin has said he would be willing to change the withdrawal deadline to a goal but leave the rest of the amendment -- requiring a pullout to begin within 90 days of enactment and limiting the U.S. mission in Iraq to counterterrorism, protection of U.S. personnel, and training of the Iraqi security forces -- intact.

Those changes could attract the support of several moderate Republicans, who have been critical of the administration's conduct of the war but are uncomfortable setting firm deadlines for withdrawal.

Democrats would risk losing support from the anti-war lawmakers intent on ending the U.S. commitment in Iraq.

As the Senate continues its Iraq war debate this week, Levin and Armed Services ranking member John McCain, R-Ariz., are hoping to wrap up debate this week on the broad defense authorization measure, which sets Pentagon policy and prescribes funding levels.

There are more than 300 amendments filed to the bill, many of which are unrelated to Iraq. When asked Friday whether many of those amendments are controversial, Levin quipped: "Oh yeah. Only about 250."

Senators today will take up a $20 billion conference report reauthorizing the Water Resources Development Act and scores of Army Corps of Engineers water infrastructure projects. The House last month easily passed the conference report, 381-40, despite objections from fiscal conservatives and the White House regarding its cost.

Supporters of the conference report say the high cost is necessary due to the backlog of projects it authorizes. WRDA is supposed to be updated every other year, but Congress has not done so since 2000. The Senate approved a roughly $14 billion WRDA bill this year, 91-4.

The Senate meets at 2 p.m. today for morning business and at 3 p.m. begins consideration of the conference report for the Water Resources Development Act.

The House meets today at 12:30 p.m. for morning hour and 2 p.m. to consider suspension bills. Votes are postponed until 6:30 p.m. On Tuesday the House meets at 9 a.m. for morning hour and 10 a.m. for legislative business. The House meets at 10 a.m. Wednesday and Thursday and 9 a.m. Friday for legislative business. The chamber will consider a continuing resolution, children's health insurance legislation, a worker safety bill, a small business bill and a flood insurance bill.

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