WASHINGTON — (CNN) Bipartisan budget talks between the White House and Capitol Hill to avert a potential fiscal calamity picked up steam Monday, as leaders in both parties neared a major accord to avoid a debt default by early November.
Several sources familiar with the discussions said that the House was looking at moving a debt limit increase through the 2016 elections until March 2017, taking the issue off the table for this Congress. As part of the fiscal package, lawmakers would consider a budget deal that would raise budget caps and include corresponding cuts to offset the higher spending, sources said.
The deal could be as long as two years in-scope and could amount to a temporary ceasefire in the bitter budget wars that have dominated Congress since Republicans took control of the House after the 2010 midterm elections. It also would amount to a final act by House Speaker John Boehner, who has been stymied repeatedly in attempts to reach budget accords with President Barack Obama.
The deal includes $80 billion in increased defense and domestic spending over two years‎, a senior House source told CNN. It also includes more money for the Pentagon’s overseas contingency account.
That new spending would be offset by sales from the strategic petroleum oil reserve, use of public airwaves for telecommunications companies and changes to the crop insurance program — among other measures. Moreover, the deal would spread out increases in Medicare premiums over time so beneficiaries don’t feel them acutely. It would also aim to preserve the Social Security disability trust fund, sources said.
Boehner’s office negotiated many of the details directly with the White House, but House Minority Leader Nancy Pelosi, Senate Majority Leader Mitch McConnell and Senate Minority Leader Harry Reid were also part of the discussions as the framework was developed, according to a source familiar with the talks.
As he walked off the floor and back to his office, McConnell signaled leaders were on the cusp of a deal to raise the debt ceiling and budget caps.
“Yeah, we’re still talking,” he said.
He was then asked if he feels good about where they are he repeated, “We’re still talking.”
On the floor, Reid signaled talks were moving forward as well.
“There is no reason to have one — that is a crisis,” he said.
House and Senate GOP leaders scheduled a closed door meeting for rank-and-file members for Monday evening to discuss the emerging deal.
The legislation could be filed as early as Monday night with a House vote likely Wednesday — the same day as House Republicans vote to elect a new speaker.
The deal is not yet final, and could ultimately change. But the discussions are moving quickly since Boehner wants to wrap up the divisive fiscal issues before he hands the gavel on Thursday to Rep. Paul Ryan, R-Wisconsin, who is expected to win House leadership elections.
It’s still uncertain whether the two sides — particularly in the House — could win over the rank-and-file and push the matter to final passage. But if Pelosi agrees to back the package, and Boehner can deliver a large segment of his conference, it could be enough to overcome opposition from conservative factions. Two sources said Monday that Boehner and Pelosi were having “productive” discussions.
The possible deal could give both sides cover. The White House has said that the debt limit should not have any corresponding budget cuts and should pass without restrictions in order to meet the November 3 deadline to avoid a possible default.
But if a budget deal moved at the same time, Republicans could point to the cuts Democrats agreed to in order to argue they were winning concessions from the White House. One source familiar with the discussions said that the two sides were looking at the possibility of a two-year budget deal, effectively decreasing the chances of a shutdown December 11.
Boehner was expected to discuss the matter with his leadership team later Monday afternoon.
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