kcentv.com - KCEN HD - Waco, Temple, and KilleenCongress Reaches Final Payroll Tax Cut Deal

Washington (CNN) -- Congressional negotiators have resolved all differences on a deal to extend the payroll tax cut and unemployment benefits while avoiding a fee cut for Medicare doctors for the rest of the year, leaving only technical issues to sort out.

The deal "is a fair agreement and one that I support," House Speaker John Boehner, R-Ohio, said Thursday morning.

House Minority Leader Nancy Pelosi, D-California, also voiced her support, and said it appeared Congress "may be voting shortly" for the deal.

Earlier in the day, Montana Sen. Max Baucus, the top Democrat on a 20-member conference committee tasked with writing the bill, called the deal "very good for the country."

The panel's top Republican, Michigan Rep. Dave Camp, said he's "confident this can be concluded ... and we're moving forward."

Resolving the technical issues and getting enough support from the panel is expected to take through at least Thursday. The committee includes members of the House and Senate and is equally divided between Democrats and Republicans.

Once the committee approves the bill, it needs to pass both chambers of Congress before advancing to President Barack Obama to be signed into law.

The roughly $100 billion payroll tax cut, a key part of Obama's economic recovery plan, has reduced how much 160 million American workers pay into Social Security on their first $110,100 in wages. Instead of paying in 6.2%, they've been paying 4.2% for the past year and two months. The break is worth about $83 a month for someone making $50,000.

The agreement came together after House Republicans dropped a key demand Monday, saying they would accept the extended payroll tax cut without including spending cuts elsewhere to pay the $100 billion cost.

On Wednesday, Boehner defended the decision to move forward with a payroll tax cut extension that is not paid for, arguing it was the only way to prevent a tax hike.

"We were not going to allow Democrats to continue to play games and cause a tax increase for hardworking Americans," the speaker told reporters. "We made a decision to bring them to the table so that the games would stop and we would get this worked out."

Boehner said he expects a vote on the measure this week.

While a number of conservatives are upset that the deal will add to the deficit, some GOP House members have nevertheless said they expect the package to ultimately pass with support from a majority of Republicans as well as Democrats.

"It's the art of a deal. I mean, it's a compromise," said Rep. Steve Latourette, R-Ohio. "You have people that didn't get ... 100% of what they wanted."

The agreement covers all three measures -- the payroll tax cut, the unemployment benefits extension, and the so-called "doc fix" -- for the rest of 2012. The latter two measures -- costing a combined $50 billion -- will be paid for, aides said.

Possible funding sources to pay for the benefit extension and the doc fix include savings from broadband spectrum sales of about $13 billion, increased pension contributions by federal employees of about $16 billion, and cuts to Medicare hospital and specialist fees that would not affect patients, according to the congressional aides.

Under the terms of the deal, the maximum time an unemployed person can receive benefits will drop from 99 to 73 weeks, according to a GOP aide and a Democratic aide close to the discussions. The maximum length of time for people in states with an average unemployment rate will drop to 63 weeks.

In addition, states will be allowed to perform drug tests on individuals applying for unemployment benefits if those people lost their previous job because they either failed or refused an employer's drug test, according to sources. Individuals receiving unemployment assistance could also be tested if they are seeking a job that generally requires a drug test.

Also, welfare beneficiaries will be banned from accessing public assistance funds at ATMs in strip clubs, liquor stores, and casinos.

The payroll tax cut, unemployment benefits and enhanced doc fix payments are currently set to expire at the end of February -- a timeline put in place through a short-term agreement reached by Congress in December. That agreement also set up the conference committee that resumed negotiations last month on a longer-term deal.

Monday's decision by House GOP leaders to drop their insistence that the tax cut extension be paid for by offsetting spending cuts was a sharp turnaround for House Republicans. Top party members previously insisted that a failure to fully pay for the tax break would be financially reckless.

But the debate over whether and how to extend the tax cut has been a political loser so far for the Republicans, who publicly questioned its value last year. Democrats have gleefully highlighted the GOP's reluctance, using the issue to portray Republicans as defenders of the rich who are indifferent to the plight of the middle class.

Political analysts believe the showdown over the payroll holiday has eroded GOP strength on the party's core issue of lower taxes. Fearing negative repercussions, Republican leaders have now backtracked on the issue twice: dropping their opposition to the two-month extension last December and dropping their insistence on paying for a longer extension on Monday.

"December was a debacle," Sen. John McCain, R-Arizona, said Wednesday. "We don't want to repeat that."

"I think the GOP has read the writing on the wall when it comes to the payroll tax cut," said Brown University political scientist Wendy Schiller. "Americans are benefiting from it, and to take it away at this juncture leaves them open to charges of raising taxes. ... It would severely hamper the GOP presidential nominee's effort to defeat Obama."

Boehner and other top House GOP leaders tried Monday to separate the payroll tax extension from provisions dealing with unemployment benefits and the doc fix, but quickly backed away from the proposal. Democrats objected loudly to the idea.