The House passed a $1 trillion funding bill Friday that will keep all government agencies open into 2012, a move that avoided a partial government shutdown at the end of the day.
The action came after House and Senate negotiators broke through a weeks-old stalemate and announced a deal late Thursday, with both parties backing off on add-on provisions in the spending bill the other had declared unacceptable.
The Ohio Republican added that, unlike previous federal spending bills, this one contained no earmarks — legislative provisions that direct money for a specific project.
The bill would fund several government agencies for the rest of the 2012 fiscal year, which ends after September 30, 2012. It now moves the Senate, which is expected to easily approve it Saturday. While funding for the agencies technically expires at the end of Friday, the White House said agencies would remain open Saturday pending the Senate’s passage of the measue.
The bill, which passed by a vote of 296-121, trims spending for most domestic agencies and hands the Pentagon its smallest budget increase in years. War costs would be $115 billion — a $43 billion cut from the previous year.
The package will save almost $31 billion in total discretionary spending compared to last year’s level.
“As with any compromise, this bill isn’t perfect, but it represents the kind of responsible governing that will help move our country forward,” said House Appropriations Chairman Harold Rogers, a Kentucky Republican.
But with the funding crisis was averted, Congress heads toward another showdown
on legislation to extend the current 2-percent payroll tax cut, which expires at the end of the year. Both parties have said they want to extend the tax break another year, but are divided over how to pay for it.
A key sticking point is Republican insistence on including an unrelated item that calls for quick action on the proposed Keystone XL oil pipeline, a provision that President Obama in the past said he strongly opposes.
The House already has passed legislation that extends the payroll tax cut into 2012, which Mr. Obama also supports. But included in the GOP-crafted bill is language aimed at forcing the Obama administration to move forward with the proposed Keystone XL pipeline, a $7 billion project would transport oil from western Canada to the U.S. refineries on the Texas Gulf Coast.
Business groups and labor unions that would build the project have pushed to quick approval of Keystone, but environmental groups have rallied to block the proposal. The Obama administration recently moved to delay a decision until after the 2012 election, saying it needs more time to study the project. But Congressional Republicans — and some Democrats — are pressing for an expedited review.
Senate leaders now are negotiating their version of the tax bill. Senate Majority Leader Harry Reid, Nevada Democrat, wants the Keystone provision dropped. But Minority Leader Mitch McConnell, Kentucky Republican, has vowed to keep the pipeline language in the bill.
“Frankly, I will not be able to support a package that doesn’t include the pipeline,” Mr. McConnell said Friday.
And Mr. Boehner told reporters Friday that, if the bill comes back to the House without the Keystone provision, “we will make changes to it, and I will guarantee you that the Keystone pipeline will be in there when it goes back to the United States Senate.”
House Minority Whip Steny H. Hoyer, Maryland Democrat, accused Republicans of hypocrisy, saying the majority party had pledged to refrain from inserting “extraneous matter into must-past bills.”
White House spokesman Jay Carney was peppered with questions during his briefing Friday with reporters about the inclusion of the Keystone provision in the payroll tax cut extension bill and appeared to play down the president’s opposition to including it.
Mr. Carney reiterated the president’s opposition to “these types of extraneous issues being inserted in a tax cut bill,” but later pointedly noted that the president “hasn’t stated whether the Keystone permit should be granted or not.”
Mr. Carney said the president stands by his decision to delay approving Keystone until further review of its impact on the environment and said Republican Nebraska Gov. Dave Heinemen was one of the first elected officials to sound the alarm on the plan.
The payroll tax is 4.2 percent this year, but reverts to its usual 6.2 percent on Jan. 1 without congressional action.
• Susan Crabtree contributed to this article.