–Senate Approves $915B Omnibus Spending Bill, Sends Bill To Obama
–Senate Sends 2 Month Payroll Tax Cut Extension To House
–House Expected To Return To DC Early Next Week To Approve Payroll Plan

By John Shaw

WASHINGTON (MNI) – The Senate Saturday passed a $915 billion fiscal
year 2012 omnibus spending bill and a two-month extension of last year’s
payroll tax cut and a renewal of unemployment insurance benefits.

The Senate passed the FY’12 omnibus spending bill on a 67 to 32
vote.

The House passed the same omnibus spending bill Friday so the bill
now gets President Obama’s signature.

The omnibus spending bill funds the nine fiscal year 2012 bills
that had not yet been approved. These bills are the defense, energy
and water, financial services, homeland security, interior-environment,
labor-health human services-education, legislative branch, military
construction-veterans affairs and state-foreign operations spending
bills.

When Obama signs the bill, this will complete action on FY’12
budget. The 2012 fiscal year began on Oct. 1.

The overall level of discretionary spending for FY’12 will be
$1.043 trillion, a level agreed to earlier this year by Obama and
congressional leaders.

The Senate Saturday also approved a two-month package to extend the
payroll tax cut, unemployment benefits and to prevent Medicare payments
to doctors from being cut by 27%.

That package was approved by the Senate on a 89 to 10 vote. The
House will return to Washington early next week to vote on this package.

Senate leaders were unable to reach a broad agreement that would
fund this package for a full year, so they have agreed to extend the
programs for two months.

This scaled-back package would cost about $40 billion and will be
paid for by higher fees that Fannie Mae and Freddie Mac charge to
mortgage home lenders.

The Senate compromise will force the payroll tax cut extension
issue to be debated again early next year.

The major stumbling blocks to a year-long payroll tax cut extension
package were how to pay for the entire package and the demand of
Republicans to put a provision in the package that expedites the
construction of the Keystone XL pipeline from Canada to the Gulf of
Mexico.

Under the bill that the Senate just passed and the House will
consider next week, a construction permit for Keystone pipeline will go
forward within 60 days unless the president determines that the pipeline
is not in the U.S.’s national interest.

** Market News International Washington Bureau: (202) 371-2121 **

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