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Payroll Tax Deal Taking Shape

House and Senate negotiators were close to a final agreement Wednesday night on a sweeping package to avoid a tax increase on millions of Americans and a lapse in jobless benefits, hoping to put to bed months of talks just two weeks before the deadline.

It remained unclear whether the still-tentative deal, even if signed by all of the conferees, would be accepted by a wide majority of Members.

Heading into Wednesday evening, however, conferees were attempting to set up a meeting to formally sign on to the package.

Before all the specifics were released, Members on both sides, even in leadership, groused about provisions in the bill. Democrats took issue with a provision that would cut some federal worker pensions to fund the jobless benefits. Such a move could put Members from Maryland and Virginia — including House Minority Whip Steny Hoyer (D-Md.) and payroll tax conferees Rep. Chris Van Hollen (D-Md.) and Sen. Benjamin Cardin (D-Md.) — in a tough spot.

“A lot of us are concerned,” about taking money from federal worker pensions, Assistant Minority Leader James Clyburn (D-S.C.) said. He added that such a provision could keep him from voting for the bill.

One Senate Democratic aide indicated that Members were trying to replace the provision with another that would still attract the requisite amount of Republican support to pass the bill.

Republicans, meanwhile, had a host of complaints about plan, including the fact that the $100 billion payroll tax cut extension would not be offset and that the bill would not contain sought-after reforms to the unemployment insurance system.

Some Republicans in the House have already vowed to vote against the measure, and as more details emerged about the bill, more were joining the chorus.

Leadership hopes to bring the bill to the floor Friday. And despite the complaints and threats to vote against the bill, leaders remained hopeful that the measure could pass with a truly bipartisan vote.

Rep. Jack Kingston, who said he was leaning toward voting against the bill on Wednesday afternoon, said he thinks the measure will pass.

“I suspect we’ll get there,” the Georgia Republican said. “Once you have a conference report … you can afford to lose 60 people on either side.”

Senate Democrats were waiting to see whether House Republicans could clear the package before responding to the agreement or providing Members of their own caucus with details of the deal.

As of Wednesday afternoon, rank-and-file Senate Democrats had not been officially briefed on the agreement.

Top Democrats did discuss it during their weekly chairmen’s lunch, and many aides anticipate at least some backlash during an afternoon meeting of the full caucus today. However, Democrats predicted that eventually most in their party would fall in line to pass the bill.

Even Senate leaders conceded the agreement, particularly the compromises made on jobless benefits, is far from ideal.

“No,” Senate Majority Whip Dick Durbin (D-Ill.) said when asked whether the agreement is good. “We started with a position that says we won’t pay for [unemployment insurance] — we’re not going to prevail on that. Secondly, we want to protect those, particularly in high unemployment states, so there’s some strong feelings among some of our Members.”

The agreement would reduce the number of weeks unemployed workers could receive benefits in most states, but the number of weeks varies depending on the jurisdiction.

Still, Durbin acknowledged that it is much easier for Senate leaders to get their Members in line than it is for House Republicans.

“What [Senate Majority Leader Harry Reid (D-Nev.)] said to me this morning was, ‘I think we have an agreement; I know what’s in it’. And now the question is, ‘What can [Speaker] John Boehner pass?’ And as soon as he puts something on the floor and passes it, I’m ready to sit down with our people and say, ‘Well this is it,'” Durbin said. Because the House GOP nearly scuttled December’s short-term deal on the payroll tax cut extension that was negotiated between Reid and Minority Leader Mitch McConnell (R-Ky.), Durbin said the Senate would not likely again try to initiate legislation.

“I think McConnell’s gun-shy. He got burned,” Durbin said.

Sen. Debbie Stabenow (D-Mich.), a member of the leadership team who represents an economically depressed state, expressed concern about the proposed unemployment insurance reform, though she wanted to reserve judgment until she reviewed the final agreement.

“Obviously, I’m concerned with any reduction in weeks when we have so many people looking for work for so long, but I have to look at all the details,” Stabenow said.

Senate Democrats also are concerned that Sen. Rand Paul (R-Ky.) could block any unanimous consent agreement that would be needed to vote on the package by Friday, the Senate Democratic aide said.

Paul has delayed consideration of the Senate transportation bill and the confirmation of a judge in an effort to get a vote on his proposal to cut off aid to Egypt until Americans being held there are released. Paul wants to use the roughly $1.3 billion a year the United States provides to Egypt in aid as incentive for the Egyptian authorities to release the Americans.

Humberto Sanchez contributed to this report.

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