Senate Closes in on $10B Virus Funding Deal; House Dems Object to Lack of Global Funding

White House remains coy on whether Biden will accept bill without global effort.

Lawmakers on Capitol Hill scrambled Monday to finalize and pass a $10 billion COVID-19 response package that will likely be less than half the amount that President Biden demanded.

The evenly divided Senate is trying to strike a deal that can cobble together 60 votes and get a budget score before lawmakers depart town at the end of the week.

Republicans have refused to bless new spending after states used rescue funds for prisons and highways, and Democrats have said they might not accept a pared-down bill that axes global funding.

Negotiators are searching for leftover funding from last year’s virus-relief package after GOP senators said they couldn’t stomach more spending on top of the $6 trillion the U.S. has spent so far. Democrats balked at touching a specific bucket of state funds that have been allocated in stages and written into state budget plans.

The upshot is an emerging deal that will likely slash as much as $5 billion in global funding to get the package down to $10 billion from a starting point of $15 billion, though reports suggest lawmakers might find $1 billion for global efforts.

While that might satisfy the evenly split Senate, members of the Democratic-controlled House are balking and forcing the White House into a tough position after Mr. Biden championed global vaccine efforts.

“Hearing that critical global vax funding may be taken out of the COVID bill in the Senate. If the Senate does this, I am concerned many others and I may not be able to support the bill. We can’t end the pandemic without global vax funding — period,” Rep. Raja Krishnamoorthi, Illinois Democrat, tweeted.

Rep. Tom Malinowski, New Jersey Democrat, said he would reject a package that doesn’t include global funding.

“I’d rather stop the next COVID variant in Africa or Asia than have to fight it again in New Jersey,” Mr. Malinowski tweeted.

The U.S. plays an outsized role in supporting the global pandemic fight. It has provided $4 billion to COVAX, the global vaccine-sharing program, meaning it accounted for 36% of its funding, according to a March analysis by the Kaiser Family Foundation.

Roughly 15% of people in low-income countries have received at least one dose of a COVID-19 vaccine, compared to 80% in countries defined as high or upper-middle-income countries, according to Our World in Data.

Some public health experts say the U.S. will pay more later if it doesn’t do more to stiff-arm variants abroad.

“While there seems to be support for continuing America’s support for a global response, which is the only possible option to fight a global pandemic, the inability to find appropriate offsets has become a major barrier. If we don’t step up now, it will eventually take more time and more money to end the pandemic,” said Krisha Udayakumar, founding director of the Duke Global Health Innovation Center.

The White House has declined to say whether Mr. Biden would veto a plan that doesn’t include a large tranche of global funding.

“The president has been very clear [that] he believes this funding is important. But again, we’re going to let Congress work through, and we’re very hopeful that they are going to come to a solution,” White House Communications Director Kate Bedingfield told reporters last week.

Republicans say the Democrats only have themselves to blame for the slimmed-down package. Lawmakers are debating a standalone package after some House Democrats objected to reeling in $7 billion from Mr. Biden’s 2021 virus package — the American Rescue Plan — that had been set aside for state governments.

Dollars are still filtering out, and some states received funding before others, so lawmakers said some states would be disadvantaged by rescinding some of the money.

Experts say there is no practical or fair way to claw back the funds since some states have two-year budgets and allocated half for one year with the expectation they’d get the rest for the following year.

“The original sin here is states are doing bad things with their money because we gave them too much money. We shouldn’t surprised they’re using it for all kinds of stupid stuff,” said Marc Goldwein, senior vice president and senior policy director of the Committee for a Responsible Federal Budget. “We spent too much money on cutting checks and money that states didn’t need, and not enough on treatments that people need, that seems backward to me.”

The Center on Budget and Policy Priorities (CBPP), a progressive think tank, said as of December 2021, 43 states, the District of Columbia and Puerto Rico had appropriated $115 billion, or 58%, of the $198 billion set aside for them.

CBPP said Florida devoted $2 billion of its Coronavirus State and Local Fiscal Recovery Funds — 23% — to highway construction.

Other states, including Colorado, Louisiana and Washington, devoted a large share of their allocations to transportation projects, raising questions about whether all the funds were spent within the spirit of Treasury regulations around the rescue law.

“While spending on highways may help produce a stronger recovery, it is often poorly targeted to the communities that need help the most, making it a relatively low priority in states with substantial unmet pandemic-related needs and deep, long-standing structural inequities,” CBPP said in March analysis.

Alabama is using $400 million, or about 20% of its allocation, to build two large prisons, while Kentucky Gov. Andy Beshear is doling out checks for water projects.

Republicans uncomfortable with new spending have repeatedly pointed to potentially frivolous spending from last year’s package, which Democrats passed without GOP support.

“I don’t think we need to do it as an emergency, and I don’t think we need to do it without looking at the books to see what happened to an amount of spending that basically equaled the entire discretionary budget for the country — put on top of the entire discretionary budget for the country — one year ago, this month,” Sen. Roy Blunt, a Missouri Republican and key member of the Senate Appropriations Committee, said on March 22.

Rep. Tom Cole, Oklahoma Republican and member of the House Appropriations Committee, told Health and Human Services Secretary Xavier Becerra last week he wants to sustain the COVID-19 fight but he’s skittish about the flow of dollars.

“I don’t want to get behind the eight ball here, but I also don’t want to just say it’s OK to send money out willy-nilly to states that are supposed to be for COVID and it’s not being used that way in many areas,” Mr. Cole said.

For now, senators are steeped in negotiations that have been characterized as thorny but unfolding in good faith. The White House and its Democrats allies say they need a cash injection of some kind to ease the burden on funds that are running dry.

Negotiators are eyeing leftover money for theaters, the aviation industry and other untapped funds from last year to avoid the state funds, according to Roll Call.

As it stands, Mr. Becerra told Congress that his agency had to slash its federal shipments of monoclonal antibodies by 35% last week, and some labs said they can no longer offer free testing to the uninsured because a federal provider-relief fund is running out of money.

Quest Diagnostics, a leading testing lab, said that as of March 23, Health Resources & Services Administration (HRSA) stopped accepting claims for testing and treatment for uninsured patients due to a lack of sufficient funds.

“We have begun to notify our clients and partners that we no longer expect to be reimbursed for testing through this program unless additional funding is allocated to HRSA,” Quest spokeswoman Kimberly Gorode said.

She said people covered by Medicaid, Medicare or private insurance won’t be affected but uninsured customers will face a $100 fee when they seek molecular virus testing from one of Quest’s physician clients.

Reporting by The Washington Times.