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Trimming Economic Stimulus Legislation Gains Momentum
Wednesday, February 4, 2009
4:30 PM


A plan by a bipartisan group of senators led by Ben Nelson (D-NE) and Susan Collins (R-ME) to trim as much as $200 billion from the $900-plus billion economic stimulus legislation is gaining momentum. Specifics of the proposal are "still in discussions," a Nelson spokesman told Capitol Hill Reports this afternoon.

Although the details were unknown at presstime, Nelson and Collins are expected to target spending provisions that, according to the Congressional Budget Office, do not provide an immediate stimulus impact. CBO concluded that enacting the Senate's stimulus legislation would result in less than half of all "discretionary" funding for various initiatives -- such as infrastructure projects -- being released by the start of fiscal year (FY) 2011, while 72 percent of total "direct" funding (e.g., unemployment benefits) would be spent.

A possible target could be the Department of Agriculture's water and waste disposal projects. CBO estimates that only 24 percent of the $1.4 billion in total discretionary funding for these initiatives would be spent during fiscal years 2009 and 2010.

Other items that may be on the chopping block include $650 million for the digital television converter box coupon program, $400 million for screening and prevention of sexually transmitted diseases, $75 million for smoking cessation programs, and $25 million for substance abuse reduction initiatives for Native Americans.

Whatever the final Nelson-Collins amendment proposes, look for it to be the key ingredient in the Democratic leadership's attempt to secure a filibuster-proof majority that supports passage of the bill. Once the Senate approves the stimulus package, House and Senate conferees will negotiate a final bill with the White House -- and when most of the critical decisions will be made.

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Senate Floor Amendments Adopted

Coburn (R-OK) - Strikes the $246 million tax earmark for Hollywood production companies.

Mikulski (D-MD) - Tax break for individuals who buy new automobiles, with some restrictions.
Harkin (D-IA) - Provides an additional $6.5 billion to the National Institutes of Health for biomedical research.

Senate Republican Leader Mitch McConnell (R-KY) is leading a separate effort "to trim the fat" from the stimulus package while adding what he argues are more targeted and effective stimulus provisions.

"We need to fix housing first," McConnell told reporters yesterday, adding that Republicans will offer an amendment that will allow homeowners to refinance to a 30-year mortgage with a fixed interest rate hovering around four percent.

Another amendment, expected to be offered Sen. John Ensign (R-NV), will aim to "fix" the mortgages that are "under water."

© Copyright Capitol Hill Reports, Inc. (2009). No claim to original government works.

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