Democrats Wrangle Over Details of Federal Jobless Aid in Covid-19 Relief Bill

The changes were expected to be made through an amendment from

Sen. Tom Carper

(D., Del.). But Sen.

Joe Manchin

(D., W.Va.) appeared willing to support an alternate amendment from Sen.

Rob Portman

(R., Ohio) that would extend the $300 weekly payments just through July 18, according to aides and lawmakers.

“I like good amendments,” Mr. Manchin said earlier Friday without specifying which ones he was referring to.

Mr. Portman’s proposal, which doesn’t include the tax relief measures, could pass if Mr. Manchin and all Republicans vote for it, potentially imperiling Democratic support for the bill. Democratic leaders held an amendment vote open for hours while they tried to resolve the issue.

“The Democrats right now are in a bit of a quandary,” said Senate Minority Whip

John Thune

(R., S.D.) “They’ve essentially stopped action on the floor so that they can try and persuade, I think, all their members to stay together on some of these votes,” he said.

The negotiations were likely to extend the Senate’s hourslong marathon of amendment votes on the relief package, a process that is expected to stretch into Saturday morning ahead of the bill’s final passage.

The blitz of amendments, known as a vote-a-rama, stood as the last hurdle between Democrats and Senate passage of President Biden’s relief plan. Democrats are using a special process tied to the budget to pass the package without any GOP support, with Vice President

Kamala Harris

casting the tiebreaking vote.

The last-minute changes to unemployment benefits capped a week of alterations made by Senate Democrats to accommodate their 50 members, who must be united to pass the bill.

“It defies common sense to have a cliff in the middle of August when you’ve got the Senate out of session,” said

Sen. Ron Wyden

(D., Ore.), chairman of the Senate Finance Committee. “I have personally felt that the benefit should be $400, it should certainly run into September, but I know some of my colleagues feel otherwise,” he said.

A spokeswoman for Mr. Carper said keeping the weekly benefit at $300, where it currently is, would make it easier for states to administer.

The impact of the tax exemption would vary by person. Some with relatively low incomes overall wouldn’t get much of a benefit, but a middle-income person could save more than $1,000.

It wasn’t immediately clear how the tax break would line up with the current tax-filing season, given that Internal Revenue Service computers are programmed to see this income as taxable and some people have already filed returns with unemployment benefits as taxable income on them.

The move would reduce or eliminate surprise tax bills for people. Withholding varies across states, so many people hadn’t been paying enough during the course of 2020.

“For some of us, good Zoom lighting has been our biggest pandemic problem,” said

Brian Galle,

a Georgetown University law professor who has been advocating for the tax change. “But millions of others are still out of work, and this ensures they won’t have to choose between paying the IRS and paying for rent or their kids’ vaccinations.”

The new agreement also extends limits on how high-income users can deduct certain business losses. Those limits, created in the 2017 tax law, were suspended by last year’s coronavirus relief package, to the frustration of progressive Democrats. They are now in effect but are scheduled to expire in 2025 like other pieces of the 2017 law. The Democratic plan would generate revenue by extending the provision through 2026.

The relief bill also provides $1,400 direct payments to many Americans, sends $350 billion to state and local governments, funds vaccine distribution, and expands the child tax credit, among other measures. The package advanced on a procedural vote Thursday with the support of all 50 members of the Democratic caucus and no Republicans.

Once it passes the Senate, the bill would return to the House, which would need to approve the altered bill before sending it to the White House. Liberal Democrats had pushed to keep the unemployment benefits at $400 a week and weren’t expected to be pleased with the Senate’s changes. House leaders can lose no more than four House Democrats if all Republicans oppose the bill, as they did in the previous vote.

Senate Democrats are using a process known as reconciliation, which allows them to pass legislation tied to the budget with a simple majority, rather than the 60 votes most bills require. But because the process allows the majority party to pass legislation on their own, Senate rules carve out a place for lawmakers in the minority to make their voices heard, by allowing them to vote on an unlimited number of amendments. In practice, lawmakers generally get tired in the early hours of the morning and agree to wrap up the amendments, before voting on final passage.

“There will be a lengthy amendment process as the rules of the Senate require,” Majority Leader

Chuck Schumer

(D., N.Y.) said on the Senate floor Friday. “The Senate is going to take a lot of votes, but we are going to power through and finish this bill however long it takes.”

Senate Minority Leader Mitch McConnell (R., Ky.) said Democrats had assembled a wish list of liberal priorities that weren’t needed as the economy improves. But he said GOP lawmakers would try to alter the bill during the amendment votes.

“Republicans have many ideas to improve this bill,” he said on the Senate floor. “And we’re about to vote on all kinds of amendments in the hopes that some of these ideas make it into the final product.”

Many of the amendments expected on Friday and Saturday are designed to force lawmakers from the other side of the aisle to go on the record on contentious political issues.

Sen. Tom Cotton

(R., Ark.), for example, said he would offer an amendment to block prisoners from receiving the direct checks.

Others give lawmakers a chance to demonstrate their support for certain policies.

The Senate blocked an amendment from Budget Committee Chairman

Bernie Sanders

(I., Vt.) to increase the minimum wage to $15 an hour. That was a plank of the bill passed by the House, but it was stripped out of the Senate version when the chamber’s parliamentarian ruled it didn’t comply with the rules. All 50 Republicans and eight members of the Democratic caucus opposed the amendment.

“If any senator believes this is the last time they will cast a vote on whether or not to give a raise to 32 million Americans, they are sorely mistaken,” Mr. Sanders said after the vote. “We’re going to keep bringing it up.”

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