Four House Freedom Caucus members on the Budget Committee who held up the GOP’s massive reconciliation package last week reversed course late Sunday night, opening the path to a floor vote on the measure later this week.
The holdouts who blocked the bill in Friday’s Budget panel markup — Reps. Josh Brecheen, R-Okla., Andrew Clyde, R-Ga., Ralph Norman, R-S.C., and Chip Roy, R-Texas — were satisfied enough with the changes promised to them during weekend negotiations. They allowed the package to move forward by voting “present,” enabling the panel to report out the bill on a 17-16, party-line vote.
“I’m excited about the changes that have been made,” Norman said before the vote.
But it quickly became apparent the negotiations weren’t over. Shortly after the vote, Roy and the broader Freedom Caucus leadership issued statements expressing dissatisfaction with the state of play, even as they acknowledged the progress made over the weekend.
The measure “does not yet meet the moment,” their statements said, arguing more must be done to wring savings out of Medicaid and roll back green energy subsidies enacted during the Biden administration.
Democrats repeatedly pleaded with the majority Republicans for information on what changes had been made.
“The only reason this vote passed tonight is because they’ve plotted behind closed doors to hurt even more families while refusing to share this backroom deal with the American people,” House Budget ranking member Brendan F. Boyle, D-Pa., said during the markup.
House Budget Chairman Jodey C. Arrington, R-Texas, said the changes would be disclosed later in the week in a manager’s amendment, arguing that’s how Democrats handled major legislation during their years in control of the chamber.
The vote sends the package to the Rules Committee, where negotiated changes to the bill would be added. Speaker Mike Johnson, R-La., who’d been negotiating with the Freedom Caucus members all day, said before the Budget markup that “minor modifications” were being made.
Johnson predicted the measure would go to the Rules Committee for changes Tuesday or Wednesday, and hit the floor as soon as Thursday, in time for lawmakers’ scheduled Memorial Day recess.
The Freedom Caucus members had stayed in Washington over the weekend, negotiating with House leaders and White House officials to address a handful of concerns, largely focused on the fact that tax cuts and new spending take effect more quickly than the budget savings in the legislation.
Johnson and top White House officials’ attendance in the Budget panel’s offices during the rare Sunday night session was a sign of the struggle for party unity that lasted all through the weekend — and likely continuing for a few more days.
The scheduled 10 p.m. start time for Sunday night’s hearing was delayed for nearly a half hour as talks continued outside of the hearing room.
After the vote, Johnson called it a “big win” but acknowledged more talks were needed.
“There’s a lot more work to do, we’ve always acknowledged that, toward the end, there will be more details to iron out, and we have several more to take care of,” he said. “But I’m looking forward to very thoughtful discussions, very productive discussions, over the next few days.”
Medicaid, clean energy credits
The Budget Committee’s vote, in previous processes, has been largely ceremonial, as the committee is not allowed to make changes to the bill at this point in the process. But Friday’s 16-21 vote served as the first time wary House conservatives could air their concerns and fight for changes to the bill.
The holdouts pushed for Medicaid work requirements to kick in sooner than the 2029 start in the initial draft. As is, those changes would raise about $300 billion, while delaying a spike in the number of individuals without health insurance until after President Donald Trump left office.
But that way, the conservatives argued, the bill would leave a pile of savings on the table, while doing nothing to bring the federal share of costs for the 2010 health care law’s Medicaid expansion population in line with the federal match states receive for traditional Medicaid.
Roy said the current bill “fails to end the Medicaid money laundering scam and perverse funding structure that provides seven times more federal dollars for each dollar of state spending for the able-bodied relative to the vulnerable.”
Johnson said on “Fox News Sunday” earlier in the day that the original work requirements were designed to give states time to put in effective anti-fraud systems, but that they were negotiating an earlier date.
“We’re going to push it as far as we can forward, to make it happen sooner, as soon as possible, and I think that’s a good change in the policy,” Johnson said after Sunday night’s vote.
And Brecheen, Roy and others pushed for a quicker repeal of the green energy tax credits from Democrats’ 2022 budget reconciliation package.
The current draft would phase out incentives for wind, solar and other renewable and alternative electricity generation sources starting in 2029, with zero credit available for new projects after 2031. Brecheen argued at Friday’s markup that the ability for project developers to start construction in 2031 meant they could keep receiving credits beyond 2040.
With negotiated changes, the bill will now reduce “the availability of future subsidies under the green new scam,” Roy said Sunday night, though it still leaves “almost half of the green new scam subsidies continuing.”
Roy seems to want to be a team player, however. He said Saturday during an appearance on Steve Bannon’s “War Room” that he was “fully engaged” in conversations with top White House officials, including Office of Management and Budget Director Russ Vought, and said he is committed “to deliver” on Trump’s agenda.
Vought defended the bill on X after Friday’s vote, calling the proposed $1.6 trillion in spending cuts “historic” and saying the bill meets House conservatives’ earlier demands. “These are not gimmicks but real reforms that lower spending and improve the programs,” he said.
Roy called Vought “a great friend” in his comments Saturday.
‘SALT’ sticking point
Despite the progress in moving the measure out of the Budget Committee late Sunday night, the most significant hurdle left for House leaders remains in place: the state and local tax deduction.
Republicans from New York are pushing to raise the cap from $30,000 in the current bill. That effort is opposed by some red-state Republicans, some of whom argue even the current $10,000 limit is too generous.
“To those pushing me to cave on SALT: I know what my middle-class constituents need — and I won’t stop fighting for them,” Rep. Nick LaLota, R-N.Y., wrote on X Sunday.
Earlier, LaLota said he pushing to raise the top marginal tax rate from 37 percent to 39.6 percent to raise around $300 billion, which he said could be used both to expand the SALT deduction and lessen the impact of cuts to Medicaid and the Supplemental Nutrition Assistance Program. But GOP leaders appear unlikely to go along.
LaLota and his SALT caucus colleagues have pushed to expand the cap to $124,000 for married couples and $62,000 for individual filers, though a slimmer compromise is more likely; $80,000 and $40,000 have been discussed.
Johnson said late Sunday that SALT was another area leadership was still working on.
Caitlin Reilly contributed to this report.
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