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Senate OKs Deal to Avoid Government Shutdown

by Andy Sullivan and Thomas Ferraro

WASHINGTON - The Senate approved a deal on Monday to avert a government shutdown, ending a standoff that highlighted a dysfunctional Congress' trouble in passing even the most basic legislation.

With thousands of Americans battered by hurricanes, tornadoes and other disasters this year, Democrats and Republicans had deadlocked over whether emergency-relief money would have to be offset with budget cuts. (photo: AFP) "We've averted a disaster -- until the next one," said Democratic Senator Ben Nelson.

With thousands of Americans battered by hurricanes, tornadoes and other disasters this year, Democrats and Republicans had deadlocked over whether emergency-relief money would have to be offset with budget cuts.

The dispute threatened a broad spending bill that would keep the government operating past Friday, the end of the fiscal year. Congress had looked set to take the government to the brink of a shutdown for the second time this year.

Lawmakers were able to shelve the disaster relief funding spat when the Federal Emergency Management Agency said it probably would not run out of money in the coming days. It had previously said it would be broke by Tuesday.

By a bipartisan vote of 79 to 12, the Democratic-controlled Senate approved a complex deal that would keep the government running through November 18 and replenish FEMA's coffers. The Republican-controlled House of Representatives is expected to sign off on the deal as well.

The disaster relief debate may flare again as FEMA will likely have to ask Congress for more money in coming months. The disaster-relief agency has put $450 million in reconstruction projects on hold to ensure that aid can go where it is needed most urgently.

Local officials across the country watched with growing disbelief as FEMA's funding dwindled away.

"We want to make sure they have not forgotten us," said Tuscaloosa, Alabama mayor Walter Maddox, where tornadoes killed at least 51 people in April.

Democrats and Republicans had pledged to quickly send disaster relief to communities that have been ravaged by wildfires, floods and other disasters in one of the most extreme years for weather in U.S. history.

BUDGET BATTLES FLARE AGAIN

But the budget battles that have dominated Washington this year flared again when Republicans tried to cut an electric car program favored by Democrats to offset the disaster aid.

The bickering over the $1.5 billion at the heart of the dispute raised concerns about the work of a bipartisan congressional "super committee" that has a much more complicated task -- finding $1.2 trillion in budget savings by November 23.

If the 12-member committee deadlocks, $1.2 trillion in automatic across-the-board spending cuts will be triggered, beginning in 2013.

Moody's Investor Service expressed pessimism on Monday over Congress' ability to reach a deficit reduction deal, citing a lack of political consensus.

Budget battles took the government to the brink of a shutdown in April and the edge of default in August, prompting a first-ever downgrade of the country's AAA credit rating.

A Gallup poll released earlier on Monday showed Americans' faith in government has reached a new low. Only 43 percent of Americans trust the federal government to handle domestic problems.

Congress will also have to finish work on the spending bills needed to fund the government for the rest of the fiscal year and consider President Barack Obama's $447 billion plan to bring down the 9.1 percent unemployment rate. Republicans have expressed openness to some elements of the plan but oppose the tax hikes that Obama is proposing to fund it.

The bill approved by the Senate on Monday night would give FEMA's disaster fund $2.65 billion, which would be available on Saturday. FEMA could run out of money before then, but the disruption would only last a few days.

The deal includes a separate, short-term bill that would fund the government until the House returns from a week-long break. The House could approve the short-term deal this week because it is technically still in session.

A spokesman for House Speaker John Boehner declined to comment on the chamber's plans, but Republican Senator Roy Blunt, who maintains close ties to top House Republicans, said he expected it would pass.

(Additional reporting by Verna Gates in Birmingham, Alabama; editing by Ross Colvin and Doina Chiacu.)

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