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Congress reaches deal on flood insurance, student loans, transportation funding

WASHINGTON — Lawmakers approved a broad measure Friday that freezes federally subsidized student loan rates for another year, reauthorizes the government flood insurance program and extends federal transportation funding for two more years.

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The deal resolved months of debate on key legislative concerns on the eve of the July Fourth recess, and offered President Barack Obama an opportunity to claim victory after a high-profile campaign to push Congress into action on the student loan and transportation issues.

But it also provided an opening to Republicans to challenge the president's long-running argument that he is hamstrung by a do-nothing Congress: GOP aides jokingly claimed Friday that they had eliminated half of the president's campaign stump speech in a single day of action.

White House press secretary Jay Carney said "there is still much more Congress can do to create jobs and grow the economy," and urged lawmakers to pass Obama's jobs plan.

The agreement includes the first long-term transportation spending plan agreed to since 2005, replacing a series of short-term extensions.

The House passed it 373-52 and the Senate by a vote of 74-19.

"This legislation proves that when Republicans decide to work with Democrats, we can do a lot to move our economy forward," Senate Majority Leader Harry Reid, D-Nev., said.

House Speaker John Boehner. R-Ohio, called the bill "far from perfect," but thanked both parties for working to resolve how to pay for the measure.

With the bill's passage, loan rates will remain at 3.4 percent for another year, rather than rising to 6.8 percent.

The deal includes a five-year extension of the National Flood Insurance Program that covers roughly 5.6 million people. The plan ends coverage for vacation homes and gives the government more flexibility to set rates. The bill includes provisions requiring that 80 percent of fines paid under the Clean Water Act by the BP oil company for the 2010 Deepwater Horizon disaster be set aside for Gulf Coast states to restore affected areas.

The bill sets transportation funding at roughly $105 billion through fiscal 2014, averting a crisis for the nation's road construction projects that could have occurred if Congress had failed to pass a deal by the expiration of a short-term deal tonight. Obama signed a one-week temporary measure Friday evening, permitting the highway and loan programs to continue until the full legislation reaches his desk.

Supporters said the transportation deal would help save more than 2 million jobs.

Congress reaches deal on flood insurance, student loans, transportation funding 06/29/12 [Last modified: Friday, June 29, 2012 11:27pm]

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