The Senate Sunday passed the $740 billion Inflation Reduction Act, which provides billions in climate and energy funding for states and local governments.
The House plans to return Friday to vote on the legislation.
The long-negotiated bill features $430 billion in spending and $740 billion in revenue generated largely by corporate taxes. Roughly $300 billion would go to pay down the deficit.
The Senate's vote ends 18 months of negotiation. Originally dubbed Build Back Better, the bill totaled $3.5 trillion and featured a swath of major Democratic priorities, including climate and health care priorities, as well as several municipal bond-friendly items that were later dropped.
The latest version, which totals around $740 billion, was
The bill passed Sunday following a 15-hour vote-a-rama that saw more than 30 amendments introduced by Republicans, nearly all of which were defeated.
"After more than a year of hard work, the Senate is making history," Schumer said shortly before the final vote. "This bill will kickstart the era of affordable clean energy in America, it's a game changer, it's a turning point and it's been a long time coming."
President Joe Biden said in a statement that he looked forward to signing the bill.
The main revenue generator is a 15% minimum tax on the book-reported income of corporations earning more than $1 billion in annual profits. That's expected to generate around $300 billion over the next 10 years, according to Moody's Analytics. The tax features some exemptions, including for tax credits for low-income housing projects, research and renewable energy, but is expected to apply to tax-exempt municipal securities, which some market participants worry could
Boosting IRS enforcement is expected to generate $124 billion over 10 years, a provision that
A 1% tax on what public companies spend on stock buybacks is projected to generate $74 billion. Allowing Medicare to negotiate the prices of some drugs is expected to save $288 billion over the next decade.
On the spending side, the legislation provides $60 billion for solar panel and wind turbine manufacturing, $60 billion for low-emissions projects benefiting disadvantaged communities, $27 billion for clean technology research and development, $20 billion to reduce agricultural emissions, and $5 billion for forest conservation.
It also includes $4 billion for drought management, a provision sought by senators in Western states.
Roughly $64 billion would go to extending Affordable Care Act subsidies for people who purchase insurance on the exchanges.
Issuer groups like the National League of Cities, National Association of Counties and the U.S. Conference of Mayors praised the legislation despite some disappointment that the legislation did not include revamp the $10,000 cap on state and local taxes.
"With today's vote, the Senate has begun to solve some of the biggest challenges facing American cities, including rising costs and dangerous climate change," said U.S. Conference of Mayors CEO and executive director Tom Cochron in a statement. "This bill is a huge win for our cities, and America's mayors urge the House of Representatives to swiftly approve and send it to the president's desk for his signature."
Democrats have said the bill would cut U.S. emissions by 40% by 2030, a claim that some groups, including The Rhodium Group, have backed up.
