WASHINGTON _ Congressional leaders and the Trump administration are closing out talks on a two-year spending caps agreement that would suspend the debt limit until July 31, 2021.
The agreement is not yet finalized as negotiators were still working on some "technical language" issues, according to a source familiar with the talks.
But the "near-final" deal would include about $75 billion in offsets, which are expected to be very similar to those included in the 2018 two-year spending agreement that both parties agreed to.
Those provisions included extending automatic cuts to mandatory programs currently set to expire in 2027, as well as an extension of expiring Customs fees assessed on cargo and passengers arriving in the U.S. Other provisions in the 2018 law diverted some aviation security fees into Treasury's general fund and authorized additional sales of Strategic Petroleum Reserve oil.
The spending caps for fiscal 2020 and fiscal 2021 will include "parity," or equal increases in defense and nondefense discretionary spending. The source added that the near-final agreement is truly bipartisan because "both sides will be unhappy with some" of its elements.
A separate person familiar with the talks said the two-year caps deal will include about $320 billion in additional spending over the two fiscal years above the austere caps in current law.
If President Donald Trump signs off on the agreement it would put an end to the discretionary spending cuts imposed under the 2011 deficit reduction law that members of both parties have agreed to raise for the last six fiscal years.
The caps agreement would also avoid a $125 billion, or 10%, decline in fiscal 2020, which begins Oct. 1, from the levels in place for the current fiscal year.
Negotiations during the past few weeks have predominately been between Speaker Nancy Pelosi, D-Calif., and Treasury Secretary Steven Mnuchin, who has been regularly briefing Trump as well as congressional Republicans.
