07/07/2022

Schumer Takes First Step in Reviving Reconciliation Deal

Aides are downplaying that a reconciliation deal is imminent

Senate Majority Leader Chuck Schumer (D-NY) took the first formal step toward reviving a reconciliation package yesterday by submitting text for Senate parliamentarian review that would allow Medicare to negotiate prescription drug costs.

The prescription drug pricing proposal is just one piece of what Democrats are hoping to include in a pared-back Build Back Better (BBB) Act that Schumer is negotiating with Sen. Joe Manchin (D-WV), who effectively ended Democrats’ efforts to pass a broader spending package last December.

Democrats are working to finalize a retooled proposal to address climate change next week when lawmakers are set to return from recess. According to numerous reports, Schumer and Manchin are discussing an overarching reconciliation agreement that would raise roughly $1 trillion in revenue, with $500 billion put toward new spending and $500 billion toward bringing down the federal budget deficit.

Aides for Schumer and Manchin are downplaying that a reconciliation deal is imminent. On climate provisions, Democrats are still negotiating with Manchin over a tax credit for electric vehicles, and tax credits for producers of clean energy are also unresolved.

“Suggestions that a reconciliation deal is close are false,” Sam Runyon, a spokesperson for Manchin, told The Washington Post. “Senator Manchin still has serious unresolved concerns and there is a lot of work to be done before it’s conceivable that a deal can be reached he can sign onto.”

Among the potential revenue raisers on the table are a 15 percent corporate minimum tax, a 3.8 percent net investment income tax on wealthy taxpayers and savings from prescription drug pricing reforms.

This article was provided to OSAP by ASAE's Power of Associations and Inroads.