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Conference committee unlikely in payroll tax dispute

By Tom Cohen, CNN
updated 7:24 PM EST, Wed December 21, 2011
STORY HIGHLIGHTS
  • Politics and process are against the House Republican push for a conference committee
  • Conference committees resolve differences between House and Senate legislation
  • Setting up a conference panel could take 10 days
  • Democrats appear to have the upper hand in the payroll tax debate

Washington (CNN) -- In the world of the U.S. Congress, appointing a conference committee is one option for the House and Senate to resolve their differences when each chamber has passed its own version of legislation.

House Republicans now are calling on President Barack Obama and Democratic leaders to agree to such a panel to end the impasse over extending the payroll tax cut before it expires at the end of the year.

Speaker John Boehner has named eight House members as negotiators, or conferees, and he wants Obama to order the Senate to do likewise.

However, there are several reasons that approach won't happen, and they involve politics and procedure.

First, the process of setting up a conference committee includes procedural steps that can stretch out for 10 days. In the Senate, for example, up to three separate votes can be forced, with rules calling for 30 hours of debate on each and intervening days between them.

Therefore, unless both parties unanimously support a conference committee, it is impossible to start it up before the payroll tax cut expires on January 1.

Then there are the conference committee rules, which restrict negotiations to the specific differences between the House and Senate legislation under discussion.

According to a Library of Congress summary of rules for House conferees, the negotiators "may not strike or amend any portion of the bill that was not amended by the other" chamber.

"Furthermore, they may not insert new matter that is not germane to or that is beyond the scope of the differences between the two Houses," the summary says. "Where the Senate amendment revises a figure or an amount contained in the bill, the conferees are limited to the difference between the two numbers and may neither increase the greater nor decrease the smaller figure."

In addition, the summary says that the final agreement by a conference committee "may not include matter" that wasn't part of the legislation from either chamber.

That means issues considered in previous talks between Senate Democrats and Republicans, but not included in either the Senate's proposed two-month extension or the one-year extension passed by the House, would be prohibited from conference committee deliberations.

Under the arcane and complex rules of Congress, there can be some leeway of such restrictions. However, including provisions outside the specific differences between the original House and Senate legislation opens the process to further procedural hurdles when the compromise worked out by the conference committee goes back for final approval from each chamber.

For now, that means that House Republicans have everything to gain from a conference committee, while Obama and Democrats have everything to lose.

The differences between the House and Senate measures are significant.

With a price tag of more than $180 billion, the House bill, which reflects the conservative ideology of the Republican majority, proposes a series of spending cuts, including freezing pay for federal employees and members of Congress, eliminating a child tax credit for those in the United States illegally, increasing Medicare premiums for those who earn more than $80,000 annually, and increasing fees on mortgages insured by Fannie Mae and Freddie Mac.

It also includes a provision restricting environmental regulations on industrial boilers.

The measure calls for a one-year extension of the payroll tax rate and a two-year extension of increased payments to Medicare doctors, a step known as the "doc fix."

It also renews aid for the unemployed while cutting back the maximum length of jobless benefits from the current 99 weeks to 79. In addition, the measure allows states more flexibility in distributing unemployment assistance, permitting states to require those applying to submit to drug tests or show they are pursuing a high school degree if they don't have one.

The Senate version calls for a two-month extension of the payroll tax cut, unemployment benefits and the "doc fix" payments. The short-term extension resulted when Senate negotiators were unable to agree for now on how to pay for a one-year extension.

It would pay the $33 billion price tag for the short-term extension by increasing the fees that new homeowners with federally backed mortgages would pay to Fannie Mae, Freddie Mac and the Federal Housing Administration. Those entities would then turn that money over to the U.S. Treasury.

According to conference committee restrictions, topics eligible for negotiation would be the differing provisions to pay for the measure, as well as the length of the extension. That would allow House Republicans to push for the various components of their bill in the conference negotiating process, but prevent other ideas not included in either the House or Senate measure from being introduced.

For example, the Democratic push for a surtax on income over $1 million that was dropped in the face of Republican opposition could not be added by a conference committee. Neither could Obama's original proposal to expand the payroll tax cut by lowering the rate to 3.1% from the current 4.2%, compared with the original rate of 6.2%.

Negotiations between Senate Democratic and Republican leaders are making progress on a one-year compromise, Obama insists, but they need the two-month extension now to ensure that any hitches don't allow taxes to go up for working Americans after January 1.

A conference committee would be unable to consider possible compromise provisions previously discussed in those Senate talks.

The president and his party appear to hold the advantage in the public debate on the issue by portraying House Republicans as obstructionists who won't agree to the Senate proposal, which passed on an 89-10 vote, including support from most of the chamber's 47 GOP senators.

"This is a Christmas gift for the Democrats right now," CNN Political Director Mark Preston said Wednesday, adding that House Republicans "are on the wrong side of this issue."

Even some Senate Republicans called for their House party brethren to accept the two-month extension and move on.

In the end, Obama and Democrats have little motivation to yield in the showdown. Instead, they call for House Republicans to pass the Senate's two-month plan to allow further negotiations on a one-year deal -- outside the confines of a conference committee.

CNN's Lisa Desjardins and Kate Bolduan contributed to this report.

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