Reconciliation Bill Fails Vote

OMAHA (DTN) -- The "One Big Beautiful Bill" stalled Friday when five House Republicans sided with Democrats in the House Budget Committee and voted against merging and advancing the budget reconciliation bill.

The package meant to extend and expand on the 2017 tax cuts also includes provisions to improve the farm safety net, while cutting spending on programs such as $880 billion from Medicaid and roughly $300 billion from the Supplemental Nutrition Assistance Program (SNAP). The bill failed to advance in a 16-21 vote in the House Budget Committee.

Friday afternoon it was unclear what the next step would be in negotiations among House members, but the Budget Committee was expected to meet again Sunday at 10 p.m. The initial plan had been to get the bill dubbed the "One Big Beautiful Bill" on the House floor next week before Memorial Day.

The task of the House Budget Committee under the reconciliation process is to mesh together bills from as many as 11 other committees in the House, including the tax cut package from Ways & Means and the farm-bill package with nutrition cuts from the Agriculture Committee.

The bill's total tax cuts are projected to cost $4.5 trillion over 10 years, but the bill includes roughly another $1.2 trillion in projected spending cuts, though the bill also increases spending for military and border security. Among the cuts are rollbacks in an array of climate and renewable-energy tax breaks and programs from acts such as the Inflation Reduction Act that a Democratic-led Congress passed under the Biden administration.

While Democrats remain unanimous in opposing the budget package for cuts to programs such as Medicaid and nutrition, the conservatives who rejected the bill oppose it because they say the bill doesn't cut federal spending deep enough.

Four Republican lawmakers voted against the bill out of spending concerns while Rep. Lloyd Smucker, R-Pa., changed his vote to "no" primarily for procedural reasons. By voting no, he provided a chance to have the bill reconsidered.

Rep. Chip Roy, R-Texas, both pushed back on Democrats who argue the bill cuts Medicaid, but Roy highlighted that Medicaid spending will continue to rise despite tighter eligibility requirements. He then admonished Republican colleagues for the overall lack of spending cuts.

"This bill falls profoundly short. It does not do what we say it does with respect to deficits," Roy said.

Instead, Roy highlighted that spending increases are "front-loaded" in the first few years of the package with cuts coming in later years. "Deficits will go up in the first half of the 10-year budget window," Roy noted.

Roy added, "The fact of the matter is this bill has back-loaded savings and has a lot of front-loaded spending."

Rep. Ralph Norman, R-S.C., also criticized the overall spending in the package.

Those backloaded spending reductions were reflected in the House Agriculture Committee provisions. Under those sections, more costs for the Supplemental Nutrition Assistance Program (SNAP) would shift to states after 2028.

The bill's work requirements for Medicaid passed out of the Energy and Commerce Committee don't kick in until after 2028 as well.

Also, joining Roy and Norman were GOP Reps. Josh Brecheen of Oklahoma and Andrew Clyde of Georgia.

While conservatives have criticized the package for its cuts, some other Republicans from high-tax states have complained the tax package doesn't do enough to help people deduct state and local taxes, or "SALT," which is pegged to increase from a $10,000 deduction to $30,000.

President Donald Trump had posted on social media nearly two hours before the vote that Republicans need to stand together on the package.

Tied up in the reconciliation package are key provisions for the farmer safety net. The House Agriculture Committee cleared its bill on a party-line vote Wednesday evening. The bill increases reference prices for the Price Loss Coverage (PLC) program while also raising protection levels under the Agricultural Risk Coverage program.

Payment limits for individuals and entities would increase from $125,000 to $155,000.

The bill creates a mechanism to add 30 million base acres, reflecting that large tracts of farmland have gone into production, but those acres have been excluded from commodity programs. Eligibility to enroll those acres will be limited based on planted acres and an allocation formula that USDA will use to spread out enrollment.

In tax policy, the bill maintains lower tax rates passed in 2017, but also re-establishes 100% bonus depreciation for equipment purchases and increases the deduction for qualified business income from 20% to 23%.

See, "Six Tax Changes Made for Farm Businesses in the 'One Big Beautiful Bill'," https://www.dtnpf.com/…

Also see, "House Ag Committee Passes Farm Bill Reconciliation Package Along Party Lines," https://www.dtnpf.com/…

Chris Clayton can be reached at Chris.Clayton@dtn.com

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