Senate considers unemployment insurance bill again

Senate Majority Leader Harry Reid (D-Nev.) called up a Senate bill that would extend unemployment insurance for three-months.

The Senate tabled a pending amendment in a procedural 98-0 vote in order to allow Reid to file cloture on a new amendment that pays for the three-month extension.

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The vote to table was necessary because Senate Minority Leader Mitch McConnell (R-Ky.) wouldn’t agree through unanimous consent unless Reid allowed an open amendment process on the bill, S. 1845.

“We have a number ideas on this side of the aisle to promote economic growth,” McConnell said Tuesday. “So I ask the Majority Leader to modify his request to have an orderly, open amendment process.”

Nearly 1.3 million people lost their long-term unemployment benefits at the end of December. Unemployment insurance was designed to help those looking for work in states that can’t afford to pay unemployment benefits for more than six months.

Last month, Democrats tried to pass an unpaid-for three-month extension, which failed because Republicans said they wanted the $6.5 billion cost offset. Democrats then tried to pass an 11-month extension that was fully paid for by extending sequestration for an additional year, which would generate roughly $25 billion. Republicans balked at that plan as well and demanded an open amendment process.

“We will not agree to an unlimited amount of amendments … which again is a different way to say we don’t care about an unemployment insurance extension,” Reid said Tuesday.

Sen. Jack Reed (D-R.I.) has been negotiating with GOP Sens. Dean Heller (Nev.) and Rob Portman (Ohio) to find a deal. Reed’s latest proposal is for a three-month extension that is paid for through “pension smoothing” — a pay-for used in the 2012 highway bill. 

Pension smoothing reduces pension expenditures for companies in the short term creating more taxable income. It will take four years for this accounting procedure to generate the $6.5 billion needed to cover the three-month UI extesion. Some Republicans have described the practice as a budget “gimmick” that risks greater liability in the long run.

The Reed proposal also includes an amendment from Sen. Tom Coburn (R-Okla.) that would stop millionaires from collecting unemployment benefits.

The Senate is expected to work on this legislation for the remainder of the week, with a vote on Reed's new proposal as early as Thursday.