House, Senate leaders closer to avoiding catch-all spending bill

House and Senate Republican leaders are moving closer to their twin goals of completing the fiscal 2006 appropriations process without an omnibus bill and trimming the federal budget deficit, although accomplishing both tasks before Christmas remains a heavy lift.

After lengthy consultations with House Appropriations Chairman Jerry Lewis, R-Calif., House Speaker Dennis Hastert, R-Ill., agreed Tuesday to send the $142.5 billion fiscal 2006 Labor-HHS bill back to conference by naming House negotiators as early as Wednesday.

That means the measure will probably avoid being wrapped with other unfinished spending bills into an omnibus, and will move separately, most likely next week.

That leaves only the fiscal 2006 Defense spending bill, which carries $50 billion to finance operations in Iraq and Afghanistan. It will also contain relief for Hurricane Katrina victims. Mississippi GOP Gov. Haley Barbour was on hand Tuesday to press House appropriators for a more generous package than the $17 billion envisioned by the White House.

Completion of the Labor-HHS bill separately would be a major victory for Lewis and Senate Appropriations Chairman Thad Cochran, R-Miss., who in their first years as chairmen have fought to move each fiscal 2006 measure individually.

The measure failed in the House prior to Thanksgiving, however, and House Labor-HHS Appropriations Subcommittee Chairman Ralph Regula, R-Ohio, said he would restore funding for rural health care and education sought by Republicans who voted against the bill. He said discussions on how to offset the additional funds were ongoing.

Separately, House-Senate negotiators are nearing agreement on a $45 billion five-year savings target through an array of program cuts, pension premium increases and broadcast spectrum sales. The measure would move as a stand-alone "reconciliation" bill, which is not subject to filibuster in the Senate.

House Budget Chairman Jim Nussle, R-Iowa, and other top lawmakers and staff expressed optimism the package could be completed this year. But major hurdles remain on how to reach $45 billion in savings, with drilling in Alaska's Arctic National Wildlife Refuge and cuts to Medicare, Medicaid, food stamps and other programs still unresolved and casting doubt on the timetable set by GOP leaders.

Senate Budget Chairman Judd Gregg, R-N.H., conceded that completing the deficit-cutting bill by Christmas was "problematic" but that progress might speed up once the Senate reconvenes next week.

House Energy and Commerce Chairman Joe Barton, R-Texas, the lead House negotiator on Medicaid, said no decisions have been made on that front, though talks have been "cordial." But Barton, who hails from energy-rich Texas and is a staunch ANWR backer, acknowledged the issue is at a standstill.

"The Senate won't take anything that doesn't have something in it on ANWR, and the House won't take anything with it," Barton said. "So we're at a stalemate."

He added Senate GOP leaders need to provide strong signals that ANWR will remain in the bill for House moderates to agree to negotiate. Senate Commerce Chairman Ted Stevens, R-Alaska, who has fought to open the wildlife refuge to energy exploration for decades, is prepared to give assurances. Stevens also is chairman of the Defense Appropriations Subcommittee.

The Defense bill is all but complete, but awaiting final decisions from leadership on extraneous matters such as hurricane recovery aid and money to combat a possible avian flu outbreak. President Bush has requested $7.1 billion, but Barton said he wants a more modest flu funding level, characterizing the Bush bill as "just give me $7 billion and don't ask questions."