By Alexander Bolton - 12/31/12 11:23 PM EST
Senate Republican Leader Mitch McConnell (R-Ky.) has told GOP colleagues that negotiators have agreed to postpone the automatic spending cuts known as the sequester for two months.
“Sequestration will not be implemented for two months,” said Sen. John McCain (Ariz.), the ranking Republican on the Senate Armed Services Committee.
McCain said the $24-billion cost of delaying the sequester would be offset by other cuts so as not to add to the deficit, but those details remain unresolved.
“They haven’t ironed that out yet,” he said of the sequester.
A senior GOP aide said the question over how to pay for the sequester delay is the final remaining issue in the fiscal cliff negotiations.
McConnell announced on the Senate floor earlier in the day that he and Vice President Biden had agreed to the tax portion of the fiscal cliff. That part of the package would extend income tax rates for individual income up to $400,000 and family income up to $450,000. It would set the estate tax rate at 40 percent for inheritances over $5 million.
Senate Republican Jon Kyl (R-Ariz.) said President Obama, Senate Majority Leader Harry Reid (D-Nev.) and McConnell need to see how the agreement is drafted on paper and warned they could change their minds.
Reid, for one, has not yet signed on to the tax part of the deal, amid growing concern from members of his caucus.
“Not all the bill language is written because some of the details have just been worked out,” he said.
Kyl said negotiators need to finalize the details of the offsets for the sequester and a freeze in doctors’ Medicare payments.
“While there hasn’t been an absolute final sign-off on all of those offsets, the parties that have been doing the negotiating feel confident that they have a notional agreement,” he said.
Republicans have started to coalesce behind the emerging agreement.
Sen. Kay Bailey Hutchison (R-Texas) said: "It's not something that any of us would say, 'Oh, I love it.' I don't love it, but I think it is a very good job of negotiating where there are some wins and some losses and it's about even."
Centrist Sen. Susan Collins (R-Maine) said her vote would depend on the offset to the sequester delay but indicated she would likely vote yes.
“I want to wait until I see the details, including the specific spending cuts to pay for the sequester, but as far as what I’ve heard so far I’m encouraged,” she said.