House GOP races to pass debt bill with eleventh-hour changes

By Emma Dumain, Kelsey Brugger | 04/26/2023 01:24 PM EDT

Rep. Kevin McCarthy (R-Calif.).

House Speaker Kevin McCarthy (R-Calif.) speaks with reporters as he departs a meeting with other GOP lawmakers Wednesday morning. Francis Chung/POLITICO

House Speaker Kevin McCarthy was emphatic with reporters Wednesday morning that a vote on legislation to raise the debt ceiling will occur later in the day, not wishing to allow more discontent to fester within his ranks.

The California Republican cannot afford to lose more than four votes and still pass H.R. 2811, the “Limit, Save, Grow Act,” a wish list of conservative priorities that has zero chance of becoming law but represents the GOP’s opening bid on negotiations to avoid looming economic calamity.

McCarthy and his top lieutenants rallied their members in a closed-door conference meeting early Wednesday, hours after they had relented to middle-of-the-night changes to the underlying bill to pacify dissenters.

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While changes to work requirements to qualify for federal food assistance programs cheered some conservative holdouts — Freedom Caucus Chair Scott Perry (R-Pa.) said he “loved” the revisions — it was not immediately clear whether other skeptics were now prepared to come on board.

In a bid to win support from the four Republicans in the Iowa delegation — and a handful of other Midwesterners — leadership opted not to scrap Inflation Reduction Act incentives for biodiesel, renewable diesel and other alternative fuels among the other myriad clean energy tax credits that the debt ceiling bill initially proposed to eliminate.

Republican leaders also agreed not to touch the IRA’s modified credit for carbon sequestration and incentives for second-generation biofuel.

Leaving the GOP conference meeting Wednesday morning, Iowa members did not answer questions from reporters about whether the changes were enough to sway them to “yes.”

Meanwhile, either to make up for some of the cost savings lost in reinstating these tax credits or to further appease fiscal hawks, Republican leaders sought cuts elsewhere.

The amended version of the “Limit, Save, Grow Act” would slash $1 billion in IRA grants for state and local governments to make buildings more energy efficient. An additional $5 billion contained in the climate spending bill to fund projects that reduce air pollution and greenhouse gas emissions would likewise be zeroed out.

The bill now would cut $5 billion in climate pollution reduction grants, as well as $1.9 billion for the Neighborhood Access and Equity Grant Program, an environmental justice-focused initiative from the IRA designed to improve transportation infrastructure in communities that may also be used to reduce greenhouse gas emissions.

GOP leadership endorsed cutting $200 million in deferred maintenance projects across for a national park. House Natural Resources Committee Republicans contended last week that former Speaker Nancy Pelosi (D-Calif.) had a secret deal with top Interior Department officials to allot the entire $200 million to upgrade the Presidio of San Francisco, located in Pelosi’s Northern California district.

The IRA text does not specifically mention the Presidio, but Interior Secretary Deb Haaland last week testified she understood that to be “congressional intent” (E&E Daily, April 20).

A Pelosi aide defended the former House speaker, saying the money would “help meet some of the $400 million in deferred maintenance needs, which are essential to ensuring that the Presidio remains free and open for families in Bay Area and across America” (E&E Daily, April 19).

Defending the process

While McCarthy sought to leave little room for doubt about whether the House would vote on the debt limit bill Wednesday, House Majority Leader Steve Scalise (R-La.) provided some breathing room at a press conference immediately following the conference meeting.

“The good news is, we can vote as early as today on this,” he told reporters.

He and other Republican leaders participating in the press conference avoided direct questions about last-minute tweaks over the biofuel credits and instead directed blame at Democrats and President Joe Biden for “sitting back and letting the clock run out” on negotiations.

The debt ceiling could be breached as soon as mid-June. Republicans are insisting on spending cuts and policy concessions to accompany an extension of the government’s borrowing authority by an additional $1.5 trillion or until March 2024, whichever happens first.

They would also revert spending back to fiscal 2022 levels. Biden has already vowed to veto the measure, and no Democrat is expected to support it.

“Speaker McCarthy has cut a deal with the most extreme MAGA elements of his party to accelerate taking food assistance from hundreds of thousands of older Americans and to carve out one industry from his draconian cuts without making a single change to provisions that will strip away health care services for veterans, cut access to Meals on Wheels, eliminate health care coverage for millions of Americans, and ship manufacturing jobs overseas,” White House communications director Ben LaBolt said in a statement Wednesday.

In further describing the changes made to the bill in Wednesday’s early morning hours — the House Rules Committee finished its work preparing the legislation for floor consideration a little after 2 a.m. — Scalise said the changes to the work requirements were designed to ensure the implementation dates aligned.

He also framed the maneuvering on the tax credits as “thoughtful” and the new changes as “technical” clarifications, even though they resulted in stripping away entire parts of the bill.

“There were some technical changes to address dates and alignment,” Scalise said.

“If you look at the tax credits, for example, in the initial draft repealed all of the tax credits, but some of those tax credits were not part of the IRA. Some were actually in place before that. So the intention wasn’t to get rid of all of those — just the ones that were created in the IRA, and if you look at the scoring it was really focused on that. So those clarifications were made to address that.”

Outlook still uncertain

Rep. Chip Roy (R-Texas), a Freedom Caucus member who also sits on the Rules Committee, defended the panel’s 2 a.m. product and also downplayed the extent of the revisions.

“We’re talking about harmonizing the years on work requirements and then, frankly, honoring the intent on what we were trying to do on the subsidies — repealing IRA subsidies that were supposed to go to status quo entities, and that took some complexity on the ground,” he said. “That’s literally all we did.”

McCarthy, asked if any members were concerned about late-night revisions, which run afoul of the GOP’s own promises to move major bills through “regular order,” replied, “Nope.”

Still, some members were grumbling Wednesday morning.

Rep. Nancy Mace (R-S.C.), who had expressed concerns about the proposed cuts to the IRA’s solar and wind incentives that have been beneficial to her district and state, was noncommittal, complaining that “this plan … does not reduce the deficit in 10 years.”

And Rep. Tim Burchett (R-Tenn.), who said he continued to get calls from McCarthy and Majority Whip Tom Emmer (R-Minn.) asking for him to change his mind, didn’t seem ready to budge on his opposition.

“I would like to see a true debt reduction, not a rate of growth reduction,” he told reporters. “I’m a ‘no’ vote.”

Reporter Mia McCarthy contributed.

Correction: A previous version of this story misstated spending totals for climate pollution reduction grants and the Neighborhood Access and Equity Grant Program.