FEMA funds standoff may end

Washington (CNN) — A congressional standoff over disaster relief funding that is threatening a government shutdown might be resolved as soon as Monday night, several Senate Democratic aides told CNN.

According to the aides, who spoke on condition of not being identified, the Federal Emergency Management Agency might be able to stretch its depleted funds through the rest of the current fiscal year, which ends Friday.

If it can, new funding would kick in on Saturday under spending for the next fiscal year.

A FEMA statement Monday said updated estimates showed the agency’s Disaster Relief Fund has about $114 million left that “could be fully exhausted by the end of the week.” Previous estimates had the money running out as soon as Tuesday or Wednesday.

The Republican-led House has passed a short-term spending measure for the first seven weeks of the new fiscal year that includes increased disaster relief funds in the wake of Hurricane Irene, Tropical Storm Lee, wildfires and tornadoes so far this year.

Under the House measure, called a continuing resolution, FEMA and the Army Corps of Engineers would get more disaster relief funds for the end of the current fiscal year and the start of the new fiscal year.

However, Democrats oppose a provision in the House measure that cuts other spending to offset some of the additional emergency aid for the rest of the current fiscal year.

The dispute threatened to prevent the continuing resolution from passing by the end of the fiscal year, which could have caused a partial government shutdown.

If FEMA can make it through the end of week, however, Senate Democrats say they won’t need to include additional disaster relief money for the current fiscal year, avoiding the showdown with House Republicans over whether that spending needs to be offset by cuts elsewhere.

Instead, Senate Democrats would try to pass a “clean” funding measure that would keep the government operating through November 18 without any corresponding spending cuts.

A senior Senate GOP leadership aide said Senate Republicans would likely go along with such a plan because the need for extra FEMA funding in the current fiscal year would be moot.

A Senate vote on such a measure could come as early as Monday evening, but aides stressed the emerging path out of a nasty political logjam would require an assurance by FEMA that it has enough money to continue ongoing relief efforts without disruption.

A congressional source from a state affected by recent disasters told CNN that FEMA officials indicated the $114 million remaining in the disaster relief fund “will get them to Friday.”

However, FEMA stressed that a number of variables, such as a surge in claims or another disaster, could change that assessment, the source said on condition of not being identified.

According to the source, FEMA indicated it was spending about $30 million to $40 million a day at this point. FEMA lacks any authority to borrow money if it runs out, and would have to turn to the Department of Defense or the Department of Homeland Security to take over responsibilities to “protect life and property,” the source said.

House members have gone home for the week after passing the short-term spending bill last Friday.

If Congress fails to approve a compromise version this week, a partial government shutdown could occur when the fiscal year ends at midnight Friday. It is the third time in six months that legislators have faced such a possibility.

Republicans want less disaster aid than their Democratic counterparts, and want to pay for it partly by cutting funding for programs designed to spur clean energy innovation.

The House passed a “common-sense measure,” House Speaker John Boehner, R-Ohio, told reporters last week. “It’s time for the Senate to move.”

Democrats contend the Republicans are playing politics by seeking to offset disaster relief spending that helps Americans in immediate need of help to put their lives back together.

Senate Majority Leader Harry Reid, D-Nevada, said Monday’s vote would be on a compromise package incorporating the GOP’s lower overall disaster relief spending levels while eliminating any cuts to clean energy programs.

Congressmen and senators need to “cool off for a little bit,” Reid said Friday. “There’s a compromise here.”

“More reasonable heads will prevail,” he predicted.

The House GOP legislation includes $3.65 billion in new disaster relief funding — $1 billion in emergency money for the current fiscal year and roughly $2.6 billion to be budgeted for those federal response agencies for the 2012 fiscal year that begins October 1.

Under the House bill, the $1 billion in immediate disaster funding is offset with $1.5 billion in cuts to a loan program that helps automakers retool their operations to make more fuel-efficient cars.

Another $100 million would be cut from an alternative energy loan program that provided funding for the solar panel firm Solyndra, a company that declared bankruptcy late last month despite receiving a $535 million federal guarantee in 2009.

Last week, the Senate passed a spending bill with bipartisan support that would provide $6.9 billion for FEMA and other federal agencies, to be used for disaster relief both immediately and in the new fiscal year. The Senate version required no spending offsets.

Democrats have said they will continue to oppose any offsets for the emergency spending for natural disasters.

CNN’s Kate Bolduan, Ted Barrett, Tom Cohen, Lisa Desjardins, Deirdre Walsh and Lisa Sylvester contributed to this report.

Source Blucigs

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