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Supplemental Headed to Rules Committee Tonight

House Democratic leaders will take a second crack at advancing the war supplemental tonight, when it is expected to come up in the Rules Committee with a tax increase, expanded GI benefits and extended unemployment benefits.

But the new version appears similar enough to the old version that it could cause troubles again in the Senate, where the tax portion was dumped before the Senate passed its own version of the bill before the Memorial Day recess.

A Democratic aide said language is still being finalized, but that the beleaguered bill will be broken into two pieces — one that allocates $165 billion to fund the wars in Iraq and Afghanistan into 2009, and one with domestic spending items.

The package will include expanded education benefits for veterans, a provision that carries a price tag of $52 billion over ten years. Democrats are planning for the second time to include offsets for those costs by raising taxes on couples whose incomes exceed $1 million.

A 13-week extension of unemployment insurance also is expected to be put back into the bill. House leaders narrowly passed stand-alone unemployment-benefits legislation last week, but that measure lacks the votes in the Senate to pass on its own.

When the House passed the supplemental last month, it did so in three parts. The portion dealing with war funding failed to advance, but provisions relating to Iraq policy changes and domestic spending advanced.

The supplemental passed both chambers before the Memorial Day recess, but the version the Senate returned to the House was not acceptable to different factions of that chamber’s Democratic Caucus. For example, conservative Blue Dog Democrats have continued to insist that the GI bill’s educational benefits for veterans be offset with revenue raisers elsewhere, a proposal that is dead-on-arrival in the Senate.

Emily Pierce contributed to this report.

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