CHARLESTON, W.Va. — After months of discussions among U.S. Senate Democrats about getting a legislative package through the chamber, senators on Sunday passed a measure addressing Democratic policy goals, including health care, climate change and energy.
The chamber approved the Inflation Reduction Act in a 51-50 vote split along party lines; Vice President Kamala Harris delivered the tie-breaking vote.
Sen. Joe Manchin, D-W.Va. — who surprised Democrats and Republicans when he announced the related compromise with Senate Majority Leader Chuck Schumer, D-N.Y. — voted for the bill. Sen. Shelley Moore Capito, R-W.Va., joined Republican colleagues in opposing the measure.
The legislation ended a saga in the Senate to get all Democrats to support a domestic policy package. Manchin, a moderate in his party, voiced opposition in December to a broader $1.8 trillion measure, and he initially sank hopes in July about passing a plan after sharing inflation-related concerns. Manchin later told reporters he “never walked away” from trying to reach an agreement with Schumer on a legislative package.
“For years, I have worked across the aisle to determine the most effective way to increase domestic energy production, lower energy and healthcare costs, and pay down our national debt without raising costs for working Americans. The Inflation Reduction Act is the product of that work and I am proud the Senate passed this bill that will lower the inflation taxes that have been so hurtful for West Virginian and American families,” Manchin said following the vote.
The measure includes provisions giving Medicare the power to negotiate prescription drug prices while placing a $2,000-limit on annual out-of-pocket costs. The price of insulin for Medicare patients would be limited to $35. The Senate failed to approve an amendment capping the cost with private insurers; Capito and 42 other Republicans opposed the proposed amendment. The Senate parliamentarian ruled Saturday against including language placing penalties on companies that increase drug prices at a pace exceeding inflation.
The measure would extend subsidies for the Affordable Care Act’s health insurance plans for three years. Federal officials estimate around 23,000 West Virginians would face higher premiums if Congress does not act before the end of the year.
Funding would be allocated for consumer energy rebates, investments in greenhouse gas reduction, and clean energy technology development. Coal and natural gas facilities would receive loan guarantees to improve infrastructure and increase site efficiency, and clean energy companies would be eligible for tax credits to develop sites in areas impacted by the coal’s decline. The legislation includes a tax credit for creating a hydrogen energy hub; Manchin and Capito have pushed for the development of such a site in West Virginia.
As part of the package agreement, Manchin and congressional leaders agreed to consider changes to the permitting process when the Senate resumes work in September. The West Virginia Democrat has touted its inclusion of completing the Mountain Valley Pipeline, a 303-mile system capable of transporting natural gas from West Virginia to southern Virginia once finished.
The package raises revenue through a 15% corporate minimum tax, allowing Medicare to negotiate drug prices and enforcing existing tax law. Democrats have contended the measure would not impact taxes on Americans making less than $400,000 annually. Manchin and Schumer eliminated language closing a tax loophole on hedge fund managers to secure the support of centrist Sen. Kyrsten Sinema of Arizona. Sinema and six other Democrats joined Republicans on Sunday in supporting an amendment eliminating some businesses from the corporate minimum tax.
Estimates regarding the package note $300 billion would go toward deficit reduction.
The package establishes permanent funding for the black lung disability trust fund; Congress failed to extend funding before it expired last year. The excise tax on underground coal would be $1.10 a ton, and the tax on surface coal would increase to 55 cents per ton.
Senators considered multiple amendments during a 15-hour voting period that began late Saturday evening. Legislators failed to advance most proposals given the chamber’s 50-50 split. Sen. Bernie Sanders, I-Vt. — who caucuses with Senate Democrats — proposed multiple amendments, including language expanding Medicare coverage and requirements on how the program covers prescription drug costs. Capito introduced two amendments to remove $45 million addressing greenhouse gas emissions and enact permitting changes; the Senate did not approve either proposal.
After Sunday’s vote, Capito said the package would “raise taxes on working families, kill West Virginia’s coal industry, and empower the IRS to spend more time snooping around Main Street.”
“At a time of record inflation, it’s inexplicable for them to repeat the massive over-taxing, over-spending, and over-regulating mistakes already driving us into a recession,” she said. “Throughout the Senate Democrats’ short-circuited process for ramming through this reckless legislation, I have spent a lot of time and energy exposing the harmful provisions in this partisan bill, while also offering bipartisan solutions. Unfortunately, however, families, employers, and workers in West Virginia already know they will soon bear the burden of this untimely, avoidable mistake.”
Economists estimate the measure will have a minimal effect on inflation; the related rate reached 9.1% in June.
The House of Representatives will return from its August recess on Friday to consider the Inflation Reduction Act. President Joe Biden on Sunday urged the Democrat-controlled chamber to pass the package.