- Associated Press - Thursday, December 1, 2011

WASHINGTON (AP) — House Republicans are drafting legislation to renew an expiring unemployment benefits program, officials said Thursday, and intend to add it to a planned extension of a Social Security payroll-tax cut due to run out Dec. 31.

The measure is expected on the House floor as early as next week and marks the second sign in as many days that lawmakers in both parties are eager to close out the year with a compromise on key elements of President Obama’s jobs program.

Republican officials say the cost of the extension of both programs will be covered within the measure, making sure deficits don’t rise as a result.

The officials who spoke did so on condition of anonymity to provide details in advance of a formal announcement.

With unemployment hovering around 9 percent nationally, Mr. Obama urged Congress in September to renew and expand the payroll tax cut he signed a year ago, and he called as well for an extension of benefits that can cover up to 99 weeks for the long-term jobless.

The core state-paid unemployment insurance program guarantees coverage for six months, but Congress typically has provided additional weeks of federal jobless benefits in bad times. The latest cycle of additional benefits began in 2008, the last year of President George W. Bush’s administration.

Letting extended jobless assistance expire would mean that more than 6 million people would lose benefits averaging $296 a week next year, with 1.8 million cut off within a month.

It was unclear what changes, if any, Republicans intend to propose for the unemployment benefit portion of the bill.

A struggle already has broken out over steps to pay for the payroll-tax increase.

Senate Democrats want to levy a 3.5 percent surtax on million-dollar tax filers to cover the costs, while Senate Republicans unveiled an alternative on Wednesday that relies on freezing federal workers’ pay through 2015 and reducing the government’s bureaucracy by 200,000 jobs. The bill also would raise Medicare premiums for the wealthy and would take steps to deny unemployment benefits and food stamps to anyone with a seven-figure income.

Senate Republicans said their legislation would offset the cost of the payroll-tax-cut extension and generate about $110 billion in additional savings that could reduce deficits. They circulated statistics from the Internal Revenue Service reporting that tax filers with $1 million or more in income had received a total of $20.8 million in unemployment benefits in 2009, the latest year for which figures are available. Their bill would impose a 100 percent tax on those payments.

Neither of the two alternatives appears likely to win the 60-vote Senate majority needed to advance in votes anticipated Thursday night, a double-barreled rejection that presumably would clear the way for final negotiations on a compromise.

With lawmakers eager to adjourn for the year at midmonth, Republican and Democratic leaders also have begun discussions on legislation to avert a 27 percent cut in payments to doctors who treat Medicare patients, officials said.

The measure generally has bipartisan support, since it has the backing of the American Medical Association as well as patient advocacy groups.

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