Senate Nears Saturday Passage After All-Nighter: Stimulus Update

The Senate is on track to pass President Joe Biden’s $1.9 trillion stimulus bill as early as midday Saturday after a compromise reduced added unemployment benefits to $300 a week, one of several ways moderate Democrats shaped the bill to be less generous than the House version.

Democrats also fought off a raft of Republican amendments to cut state and local funding, redirect Amtrak funding, end aid to indebted minority farmers, and stop grants for non-profit entities. The amendment process began after 11 a.m. on Friday.

But the chamber voted to include the deal Democrats reached within their own ranks to extend until Sept. 6 the $300 weekly federal supplement for jobless benefits, down from $400 a week in the House bill. Negotiations on that amendment in turn caused a separate vote on a minimum wage to set a record for the longest vote in Senate history, dragging on for nearly 12 hours as Democrats tried to keep their caucus united.

The House will need to vote on the Senate’s version. That means the changes will need to pass muster with progressives who have enough votes to sink the bill if they so choose, which would send negotiators back to the table. Democratic leaders are pledging final passage by March 14, when current supplemental jobless benefits expire.

Majority Leader Chuck Schumer pledged the Senate will “power through” the arduous final process of getting Biden’s first signature piece of legislation passed.

Senate Prepares for Passage After All-Night Vote Marathon

The Senate is on track to pass President Joe Biden’s $1.9 trillion stimulus bill around midday Saturay after voting throughout the night on amendments.

With more than 28 amendments already considered, about eight to 10 remained for votes, according to timelines outlined by Majority Leader Chuck Schumer and Republican aides.

Passage of the bill has been sealed by a a compromise among Senate Democrats which kept expanded unemployment benefits at $300 a week through Sept. 6 rather than increasing them to $400.

The amendment debate began at 11 a.m. Friday and the completion of the first vote on the minimum wage was stalled for nearly 12 hours as the unemployment insurance compromise was worked out with Biden’s personal intervention.

Overnight and this morning, the Senate rejected Republican amendments on limiting state and local aid; restricting abortion funding; banning aid to schools that have transgender athletes or fail to open 5 days a week; and end funds in the bill to aid indebted minority farmers.

The Senate anticipates voting on an amendment by moderate Republican Lisa Murkowski, who has said she supports a more targeted aid package. -- Erik Wasson

Moderate Senate Democrats Flex Muscle on UI, Wages (6:41 a.m.)

Moderate Senate Democrats led by West Virginia’s Joe Manchin have flexed their muscles over the past 24 hours, making major changes to the Biden stimulus bill and setting down a marker on the minimum wage.

The most consequential changes will come for the unemployed and for businesses which have complained of being unable to lure workers because of the level of pandemic unemployment benefits.

The House-passed bill would have provided $400 in federal weekly benefits above state benefits through August. Manchin, Delaware’s Tom Carper and other moderates objected to that. Carper led a Biden-backed effort to keep the current level of $300 per week but extend it through Oct. 4. That is when Manchin again forced a change, holding up Senate action for nearly 12 hours, until he effected a cutoff of benefits on Sept. 6.

The moves came even as seven Democrats and Independent Angus King of Maine stunned the Senate by voting against allowing a doubling of the minimum wage to be added to the bill.

Action in Congress eventually tends to spark an equal and opposite reaction. House progressives will have to decide whether to accept the changes made by moderate Democrats and pass the bill or block it, setting up more negotiations.

Ohio Democrat Sherrod Brown suggested they do the former.

“This bill is so extraordinary what we’re able to do, and if some things change at the margins they change at the margin,” he said. -- Erik Wasson

Senate Votes on Keystone Pipeline, Reopening Schools (3:29 a.m.)

The Senate has been plowing through amendments now for several hours, voting down a bipartisan effort to build the Keystone Pipeline and splitting on partisan amendments on reopening schools.

The Keystone Pipeline amendment needed 60 votes since it did not comply with budget rules. It only got 51, nine votes short, though that tally showed a bipartisan rift with Biden. Democrats Jon Tester of Montana and Manchin sponsored the proposal, which sought to cut against Biden’s decision to cancel the project.

Earlier, Democrats voted down a amendment from Florida Republican Marco Rubio to tie Covid relief funding to reopening schools. They instead backed an amendment by New Hampshire Democrat Maggie Hassan to require schools receiving funding to develop plans within 30 days for reopening safely.

Democrats also blocked an effort by Maine Republican Susan Collins to shrink the package to $650 billion by eliminating much of the bill and shrinking who would get stimulus checks, as well as an amendment from Lindsey Graham of South Carolina changing a state-and-local funding formula that he said was too generous to blue states.

About 500 amendments have been filed so far during the vote-a-rama, with Republicans promising still more -- Steven T. Dennis

Senate Amends Bill with Jobless Benefits Deal (1:29 a.m.)

The Senate voted 50-49 to accept an amendment including a deal Democratic leaders struck with Manchin, a moderate Democrat from West Virginia, to tweak the weekly amount and expiration date of supplemental jobless benefits.

With the change, the provision would extend existing $300-a-week supplemental unemployment insurance through Sept. 6 and exempt the first $10,200 of benefits from income taxes for families making less than $150,000.

Manchin had opposed an earlier offer extending the benefits until October. He and several other moderate Democrats said the $400 weekly payments included in the House-passed version could discourage workers from finding new jobs as the economy reopens.

Senators still face a gauntlet of potentially hundreds of Republican amendments and procedural motions that could drag the vote through the weekend. -- Steven Dennis

Vote Continues After Nearly 12-Hour Amendment (11:46 p.m.)

The Senate’s amendment “vote-a-rama” continued Friday night after Democrats held open the vote on the first proposed change to the virus-relief bill while they tried to reach a deal within their own party on supplemental unemployment provisions.

Manchin, a West Virginia Democrat, said he was worried that overly generous jobless benefits would discourage people from returning to work when it’s safe. He agreed to a deal that would extend a federal supplement of $300 per week unemployment aid through Sept. 6.

The nearly 12-hour vote on a minimum-wage amendment from Vermont Senator Bernie Sanders set a record for the longest Senate vote in U.S. history. Minority Leader Mitch McConnell called the delay “a spectacle” and criticized Democrats for pushing a partisan bill, unlike last year’s bipartisan packages.

“We were prepared to do yet another bill on a bipartisan basis,” McConnell said. “They wanted to do it the hard way.”

Republicans questioned why Majority Leader Chuck Schumer was cutting deals with his members to finalize the bill after the amendment-vote process had already begun. Democrats voted down McConnell’s attempt to adjourn and return to continue the vote Saturday morning.

“We are going to continue working until we get the job done,” Schumer said.

Hundreds of amendments have been filed, although the process is expected to move more quickly, aiming to finish the vote this weekend. -- Steven Dennis

Democrats Reach Deal on Unemployment Benefits (8:10 p.m.)

Senate Democrats struck a deal on an amendment to the stimulus legislation to extend the additional $300 per week enhanced unemployment aid through Sept. 6, according to a Democratic aide, after hours of negotiations that had stalled progress on the bill.

The deal also provides tax relief to workers who received unemployment insurance compensation by making the first $10,200 of unemployment insurance benefits non-taxable for households with incomes of less than $150,000.

It also would extend tax rules regarding excess business loss limitations for one additional year, through 2026.

The plan would end the supplemental unemployment benefits a month sooner than the proposal Democrats had floated earlier in the day as one of the changes made to win the support of West Virginia Democratic Senator Joe Manchin. -- Erik Wasson

Democrats Work to Salvage Unemployment Deal (7:17 p.m.)

Democrats worked to put the stimulus bill back on track after Senator Joe Manchin put a hold on their plans for a compromise on unemployment-insurance payments.

“No comments, no comments, no comments -- too much good negotiations going on,” the West Virginia Democrat said as he brushed past reporters.

Earlier Friday, the White House celebrated an apparent compromise from Senator Tom Carper, a Delaware Democrat, that would reduce weekly supplemental jobless benefits from $400 to $300 per week, but phase out on Oct. 4 rather than the end of August. The deal would also make $10,200 of unemployment benefits tax-free.

But Manchin throughout the day flirted instead with backing a proposal from Ohio Republican Rob Portman that would only extend the benefits through July 18, and not include the tax relief. Because of the 50-50 partisan split in the upper chamber, a defection by any Democratic lawmaker could lead to significant changes -- and possibly even imperil the overall bill in the House of Representatives, where liberals represent a sizable voting bloc.

A White House official who requested anonymity to discuss the situation said Biden was generally supportive of compromise to get the legislation passed, and that he and his team were in close contact with senators as they sought a resolution.

Republicans derided Democrats over the impasse. The hours-long pause in Senate work today “is pretty indicative that they didn’t have their act together,” Texas GOP Senator John Cornyn said.

Republican Senator Roger Wicker of Mississippi said he expects Manchin to vote for Portman’s amendment. “He’s done talking to them. Done talking to Schumer and the president,” Wicker said.

Port man said Democrats should have realized the difficulty in keeping their caucus together when they used a budget process that has no margin for error.

“They are having real problems. What they have is bad policy. The economy is improving and you are increasing UI? How do you explain that to people ?”

But Democratic Senator Debbie Stabenow of Michigan said she expects the matter will be resolved soon and the Senate will return to work on amendments later tonight. “We’re hammering out a couple of things, and we’ll get there.” -- Laura Litvan, Justin Sink and Erik Wasson

GOP Down by a Vote as Alaska Senator Departs: (6:19 p.m.)

Republicans are down by one vote as debate on the stimulus bill ground to a halt for six hours while Democrats haggled among themselves on unemployment aid as an earlier deal appeared to fall apart.

Senator Dan Sullivan departed Washington Friday afternoon for his home state of Alaska to attend a funeral for his late father-in-law, spokesman Nate Adams said. Sullivan would have voted “no” on the stimulus bill, Adams said. Sullivan’s absence means that Vice President Kamala Harris likely won’t need to break a tie with 50 Democratic lawmakers and 49 Republicans present to vote this weekend.

However, Democrats still don’t have 50 members on board for a crucial unemployment insurance deal after Senator Joe Manchin of West Virginia wouldn’t commit to vote for the plan. Democrats need all of their Senators to vote for the amendment to attach it to the $1.9 trillion stimulus bill that they are aiming to pass this weekend.

The agreement, which the White House supports, would have lowered the weekly expanded federal jobless benefits from $400 a week to $300, but would have continued the benefits through early October, instead of terminating them at the end of August. The amendment also makes the first $10,200 of unemployment compensation tax-free, a change that would save some taxpayers from surprise IRS bills.

Senate Republicans are working to convince Manchin to back another amendment that would extend the $300 payments through mid-July and wouldn’t make the jobless benefits tax free, therefore adding significantly less to the deficit.

Biden Appeals for Passage of His Aid Bill (4:30 p.m.)

Biden met at the White House with his economic team to highlight how the latest monthly jobs report showcases a still-damage labor market a year into the Covid-19 crisis, along with hosting a meeting with people who would be getting stimulus checks under the pending pandemic-aid bill.

Biden was joined by a Maryland woman who works providing transit to disabled individuals, a self-employed veteran from Washington, D.C., who lost his home to a fire and a representative from Mary’s Center -- a health care, social services and education resource center.

“It’s going to make a big difference in terms of their lives,” Biden said. “People in the country are hurting right now, with less than two weeks from enhanced unemployment checks being cut out.”

Biden earlier highlighted that the economy still has more than 9 million fewer jobs now than in February last year. “At that rate it would take two years to get back on track.”

“We can’t afford one step forward, two steps backward,” he said in appealing for passage of his stimulus. “People need the help now.” -- Justin Sink

Senate Voting Stalls Amid Talks on Jobless Aid (3:27 p.m.)

While Senate Democrats had looked to have nailed down a deal on the amount and duration of supplemental unemployment benefits earlier in the day, talks continued Friday afternoon, with GOP involvement.

The negotiations held up the marathon of votes on amendments for more than three hours Friday afternoon.

Democrats continue to work within their caucus to make sure that none of their members would go along with Republican amendments that could sink the bill in the House. Chief among the issues: unemployment insurance benefits.

Earlier in the day, a Democratic agreement was unveiled to reduce weekly supplemental jobless benefits to $300 per week -- from $400 in the House-passed legislation -- and extend it through Oct. 4, compared with the end of August.

The deal including making $10,200 worth of jobless benefits tax-free.

Republican senators said Democrats are still working to line up support for that deal and to ward off an amendment from Ohio Republican Rob Portman to make the benefit $300 a week through July 18. It doesn’t address the tax issue.

“They are worried about losing on Portman,” John Thune, the Senate’s No. 2 Republican, said.

Key to the outcome could be West Virginia Democrat Joe Manchin, who has argued for stricter targeting of pandemic relief.

Texas Senator John Cornyn predicted Senate would pass the stimulus bill Saturday morning. -- Erik Wasson.

Sanders Bid to Restore Wage Hike Falls Short (2:42 p.m.)

A last-ditch effort by Senator Bernie Sanders to restore a minimum-wage hike to the pandemic-relief bill is headed to defeat with 42 votes in favor and 58 against.

The vote hasn’t been made final, though there is almost no chance it would change. It remained open while Democrats attempted to nail down support for their plan to extend supplemental unemployment through September.

The Senate parliamentarian had previously ruled that the phased-in increase in the minimum wage to $15 an hour by 2025 fell afoul of budget-reconciliation rules, which Democrats are using to get the Covid-19 aid bill through the Senate with just a simple majority vote.

Sanders’s bid to waive the rules and restore the wage hike would have required 60 senators of 100 senators to agree to go along with the amendment. But it failed to get even a majority.

“An unelected staffer in the Senate should not be in charge of determining whether 32 million workers in America receive a raise,” Sanders said on the Senate floor.

There wasn’t even majority support within the Democratic caucus. Arizona Senator Kyrsten Sinema was among the Democrats who voted against it, saying the chamber should look at the issue separate from the relief legislation.

“The Senate should hold an open debate and amendment process on raising the minimum wage, separate from the Covid-focused reconciliation bill,” Sinema said in a statement.

Also voting against the attempt were Democratic senators Joe Manchin, Jon Tester, Jeanne Shaheen, Maggie Hassan, Tom Carper and Chris Coons as well as independent Angus King.

Biden has called on lawmakers to move ahead with his proposed wage hike on a standalone basis. -- Erik Wasson

White House Sees Bill Speeding Job Recovery by a Year (11:08 a.m.)

Biden’s $1.9 trillion economic rescue plan will accelerate the U.S.’s return to full employment by a year, National Economic Council Director Brian Deese said.

“Most people say that this bill would pull forward by about a year the length of time it would take to get back to full,” Deese said in an interview with Bloomberg News on Friday. He declined to make more specific predictions about unemployment.

A government report earlier Friday showed that total U.S. payrolls in February remained more than 9 million lower than the peak prior to the pandemic. Biden said Friday the report showed his stimulus legislation is “urgently needed.”

Deese added that the administration is working to speed up the delivery of stimulus checks that are a key feature of the aid bill that Congress is expected to pass in coming days.

White House economist Heather Boushey, also speaking in an interview, underscored that economic recovery will depend heavily on the distribution of coronavirus vaccines.

“Just to state the obvious, this all depends on getting shots in arms,” she said. -- Jennifer Jacobs

Senate Democrats Resolve Differences Over Jobless Aid (11:03 a.m.)

Senate Democrats have resolved differences over the level and duration of supplemental unemployment benefits in the pandemic relief bill, according to a Democratic aide.

The bonus will be kept at the current level of $300 a week, rather than the $400 provided in the House version of the bill, but they will last until Oct. 4 -- rather than the end of August, the aide said. Senator Tom Carper of Delaware, a close Biden ally, led the talks and will offer the amendment to make the change.

Tom Carper

Photographer: Leigh Vogel/UPI/Bloomberg

The White House supported the compromise. Press secretary Jen Psaki tweeted that Biden believes “it is critical to extend expanded unemployment benefits through the end of September.”

Recipients will get tax forgiveness on $10,200 worth of benefits under the deal, according to the aide.

For millions of unemployed Americans who were able to receive enhanced federal jobless benefits, the change would eliminate their obligation to pay Internal Revenue Service levies on the first $10,200 of those payments.

That tax forbearance will offer major help. Unemployment benefits, unlike stimulus payments, are subject to federal income taxes. Many states don’t withhold taxes when they make the payments, so recipients will be required to pay those levies when they file their tax return this spring. That means that the millions of workers who received unemployment benefits could face large, unanticipated tax bills.

The deal would also expand a tax provision from the GOP 2017 tax law that restricts how businesses losses can be carried forward to offset future-year profits through 2026. The provision was initially implemented through 2025.

In past economic crises, Congress has approved tax relief to help unemployed individuals. In 2009, lawmakers waived taxes on up to $2,400 in jobless benefits. -- Erik Wasson, Laura Davison

Senate Begins Debate as Schumer Pledges to Power Through (9:30 a.m.)

The Senate reconvened Friday morning for three hours of debate on the $1.9 trillion Covid-19 relief plan ahead of a marathon series of amendment votes expected to last through the night.

The first amendment to get a vote will be offered by progressive Budget Chairman Bernie Sanders, who has said he will attempt to amend the bill to raise the minimum wage to $15 per hour by 2025. That amendment is subject to an objection, since the parliamentarian has ruled it against budget rules, and 60 senators would have to vote to add it to the bill. Some moderate Democrats are expected to vote against the amendment, arguing that it would sink the bill by allowing the entire package to be filibustered by Republicans.

While many of the Republican amendment votes are expected to be designed to cause political damage to Democrats and have no chance of succeeding, others may go through.

Mitch McConnell walks to his office at the U.S. Capitol on March 5.

Photographer: Stefani Reynolds/Bloomberg

“They are dead-set on ramming through a partisan spending spree packed with non-Covid related policies” said Senate Minority leader Mitch McConnell on Friday on the Senate floor. “This isn’t a pandemic-rescue package, this is a parade of left-wing pet projects.”

McConnell said the economy is “already on track to bounce back from this crisis,” because of last year’s bipartisan virus-relief packages, not because of the $1.9 trillion bill before the Senate this week.

“Republicans have many ideas to improve the bill, many ideas, and we are about to vote on all kinds of amendments in the hope that some of these ideas make it into the final product,” McConnell said.

For amendments that are in order under budget rules -- such as one to cut supplemental unemployment benefits from the $400 per week in the bill -- it would only take one Democrat to side with 50 Republicans to make the change.

“We are going to power through and finish this bill however long it takes,” Majority Leader Chuck Schumer said on the Senate floor Friday. “We are not going to make the same mistake we did after the last economic downturn, when Congress did too little.” -- Erik Wasson

--With assistance from Justin Sink, Laura Litvan, Laura Davison, Steven T. Dennis and Erik Wasson.

To contact Bloomberg News staff for this story:
Erik Wasson in Washington at ewasson@bloomberg.net

To contact the editors responsible for this story:
Joe Sobczyk at jsobczyk@bloomberg.net