Top Senate Republicans want to pass their party’s wide-ranging agenda with two different acts by using a legislative process called budget reconciliation, a technical workaround that avoids the Democratic filibuster in the Senate and allows a law to be passed with a simple majority.
But legislative experts are warning that even doing a single bill through reconciliation is a daunting task that exposes the majority party to procedural pitfalls and political vulnerabilities.
With only the narrowest of majorities in the House, an agenda that could be too expansive for a single bill constrained by reconciliation, pointed resistance from Democrats, and a requirement to raise the debt ceiling, Republicans are attempting to thread the thinnest of congressional needles.
“They almost never do two,” Howard Gleckman, senior fellow with the Urban-Brookings Tax Policy Center, told The Hill. “It’s such a heavy lift to do one. It’s a real challenge to do two in one year. Technically, you could do it – but not easy.”
Whether House Republicans can get on the same page enough to do a single bill will be a primary focus this week as they meet with President Trump in Florida. Lawmakers on various committees are expected to meet and then deliver reports to leadership on what they can agree on for budget reconciliation by mid-week.
While Trump himself has expressed a preference for moving his entire agenda through “one big, beautiful bill,” he said he would accept splitting it up into two bills if that would be easier for lawmakers to manage.
Among more than 200 different budget cuts and tax changes, Republicans have been considering provisions that include requiring school attendance for Social Security benefits, making the consumer price index for urban consumers (CPI-U) the permanent index for national poverty programs, and levying a 10-percent general import tax that could bring in $1.9 trillion over ten years.
They have also looked at lowering the corporate tax rate to 15 percent from 21 percent at a cost of $522 billion, repealing Democrats’ Inflation Reduction Act (IRA) corporate alternative minimum tax at a cost of $222 billion, and eliminating the home mortgage interest deduction at a savings of about $1 trillion.
The first hurdle on the reconciliation obstacle course requires the Senate and the House to agree on the same budget resolution, as opposed to different versions that can be stitched together later.
If they fail to clear it, the two-bill contingency plan could be triggered, with extensions of 2017 Tax Cuts and Jobs Act (TCJA) kicked to later in the year. Since some of the 2017 Trump tax cuts expire at the end of this year, an eleventh-hour reconciliation process is likely to make a lot of Republicans nervous.
Speaker Mike Johnson (R-La.) has said he wants a budget resolution passed by the last week of February.
Another fence that Republicans need to clear is the debt ceiling. If they choose to do this in the reconciliation process, it would need to be raised by a specific amount rather than simply suspended, a move that is sure to get pushback from Republican deficit hawks.
In place of the debt ceiling hike back in December, Republicans agreed to increase the borrowing cap by $1.5 trillion in exchange for $2.5 trillion in spending cuts in the upcoming reconciliation package, sources told The Hill.
This prompted Trump to threaten deficit hawk Rep. Chip Roy (R-Texas) with a primary challenge for “getting in the way” of a formal debt ceiling increase.
Reconciliation is also subject to the so-called Byrd Rule, named after the late Sen. Robert Byrd (D-W.V.). The Byrd Rule requires that policies included in reconciliation instructions can’t add to the deficit beyond a 10-year cutoff. Prior to that cut-off, the bill can add to the deficit, but not after it.
The Byrd Rule is the reason that parts of the 2017 tax law are expiring in the first place.
The main thrust of the $1.5 trillion law was the reduction in the corporate tax rate, which was made permanent at 21 percent from an initial 35 percent. But the individual cuts were made temporary so as not to expand the deficit after 10 years.
Similar temporary measures that satisfy the Byrd Rule are likely to be used by Republicans in the current legislative debate, analysts say.
“That’s going to be in play again,” Gleckman said. “The idea that people often talk about is making the TCJA permanent. But they can’t make the TCJA permanent [in reconciliation] because of the Byrd Rule. All they can do is extend provisions for a limited amount of time, and then they’re going to run into the same problem again.”
Whether it’s one bill or two, Republicans in the Senate will have to face down at least one “vote-a-rama,” a part of the reconciliation process in which Democrats can propose any amendment they want to the bill. Knowing that these will be voted down, the minority party usually picks the most politically barbed amendments that they can think of.
“The vote-a-rama, for the majority, is typically an exercise in political abuse,” Rohit Kumar, national tax office co-leader at PwC who spent more than a decade as a top GOP Senate aide, told reporters last week.
“The minority comes up with its most conniving, politically sharp-edged amendment and makes the majority vote on it — there’s no way out.”
Last week, amid so many procedural brambles sticking to Republicans, Trump floated the idea of getting Democratic support on the extension of his tax cuts, a notion that many Democrats immediately dismissed out of hand.
“We have to get Democrats to approve it,” Trump said. “If the Democrats didn’t approve it, I don’t know how they can survive with about a 45 percent tax increase, because that’s what it would be.”
“We’ve been working along with them pretty well,” he added.
Several top Democrats in the House told The Hill last week there was little to no chance they’d consider working with Republicans, though chief Democratic tax writer Rep. Richard Neal (D-Mass.) said, “let’s hear what they’ve got to say.”
