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Negotiators report progress on long-delayed COVID aid bill

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Copyright 2020 The Associated Press. All rights reserved.

Senate Majority Leader Mitch McConnell of Ky., walks past reporters on Capitol Hill in Washington, Tuesday, Dec. 15, 2020. (AP Photo/Susan Walsh)

WASHINGTON – Top Capitol Hill Republicans labored Tuesday to keep the price tag for a long-delayed COVID-19 aid package in check, seeking to prevail in a battle over help for state and local governments, while capping the cost of bonus jobless benefits and direct payments sought by Democrats.

Negotiations on COVID-19 relief intensified Tuesday after months of futility. The top four leaders of Congress met twice in hopes of finally cementing an agreement that would revive subsidies for businesses hit hard by the pandemic, help distribute new coronavirus vaccines, fund schools and renew soon-to-expire jobless benefits.

After two meetings in House Speaker Nancy Pelosi's Capitol suite, where Democrats pressed for more generous steps to help individuals struggling in the COVID-19 economy, House Minority Leader Kevin McCarthy, R-Calif., gave an upbeat assessment.

“I think we’ve built a lot of trust," McCarthy said. “I think we’re moving in the right direction. I think there’s a possibility of getting it done."

The uptick in activity could be a sign that an agreement is near, though COVID-19 relief talks have been notoriously difficult.

“We’re making significant progress and I’m optimistic that we’re gonna be able to complete an understanding sometime soon," said Senate Majority Leader Mitch McConnell, R-Ky.

Pressure for a deal is intense. Unemployment benefits run out Dec. 26 for more than 10 million people, many businesses are barely hanging on after nine months of the pandemic, and money is needed to distribute new vaccines that are finally offering hope for returning the country to normal.

McConnell is playing a strong hand in the lame-duck session and is pressuring Democrats to drop a much-sought $160 billion state and local government aid package. Several senior Democrats, including close allies of President-elect Joe Biden — who is eager for an agreement — have said they would go along now and fight for the aid next year.

McConnell says he'll drop a demand for provisions shielding businesses from COVID-19-related lawsuits, a key priority, if Democrats agree to drop the $160 billion state and local aid package.

“We can live to fight another day on what we disagree on,” McConnell said Tuesday. “But we ought to go forward with what we can agree on."

Pelosi has insisted for months that state and local aid would be in any final bill, but as time is running out, Democrats appear unwilling to hold the rest of the package hostage over the demand.

“We’re not going home until this is done,” Sen. Joe Manchin, D-W.Va., said on CNN Tuesday morning. “We’ve got to get people a lifeline.”

Manchin is an architect of a bipartisan $748 billion aid package that is aimed at serving as a template for the leadership talks. President Donald Trump's chief negotiator, Treasury Secretary Steven Mnuchin, supports a package with many similar elements. There is also bipartisan support for transportation and transit assistance, funding for rural internet service and help for the Postal Service, among other provisions.

A Republican familiar with the talks said the biggest obstacles include money for state and local governments; how to handle direct payments favored by Trump and Democrats but opposed by many GOP conservatives; and the restoration of a bonus jobless benefit of $300 or so per week that would supplement regular state unemployment benefits. The Republican required anonymity because the talks are secret.

Lawmakers also worked to finalize a yearend catchall funding package that will be the basis for the last significant legislation of the Trump presidency.

There's a hoped-for deadline of midnight Friday to deliver the completed package to Trump. That is when a partial government shutdown would arrive with the expiration of last week's temporary funding bill. But there's no guarantee that the massive yearend measure will be completed in time. If the talks drag, further temporary bills could be needed.

Negotiations on the $1.4 trillion catchall spending bill are “essentially finished," said a congressional aide participating in the talks. While details are closely held, “the status quo is prevailing." That means Trump would get another $1.4 billion or so for a final installment to continue construction of his long-sought U.S.-Mexico border wall.

Republicans have succeeded in killing a $12 billion plan to break last year's budget mini-agreement by using accounting maneuvers to pad veterans health care funding to accommodate big cost increases from expanding access to health care services from private providers. Instead, a different set of moves is being employed to provide for equivalent spending increases for other domestic programs.

The post-election lame-duck session is the last chance to wrap up the unfinished work this year, a goal of all involved, though they have been slow until now to forge the often-tricky compromises required to pull the measure together.

A state and local aid package was part of the almost $2 trillion CARES Act that passed the Senate unanimously in March. The $150 billion aid package to states and large cities evoked little controversy then, but many Republicans are adamantly against the idea now, though any additional aid would also go to smaller municipalities left out of the prior round.