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Capitol Hill negotiations on fiscal deal and remaining bill in steady flux

With much of the country’s attention on Capitol Hill lawmakers trying Sunday to reach a deal to avert a fiscal crisis that would begin Monday at midnight, negotiations and hearing schedules are changing with no votes expected until at least the late afternoon.

-- 6:23 p.m. Reid leaves Senate floor and tells reporters asking about an update on fiscal talks to talk to Joe Biden and McConnell.”

-- 5:30 p.m. Reid says from the Senate  floor that Republicans have taken the so-called "chained CPI" off the table, negotiation continue and that the Senate will resume work Monday morning but "there is still significant distance between the two sides."

-- At 4:52 p.m. A Reid staffer says Democrats have no counter offer.

-- At 4:50 p.m., Senate Leader Harry Reid emerged from a meeting to say Democrats have made a counter offer to the Republican's Saturday night offer, which including the deal-stalling provision to change the way Social Security benefits are calculated. Reid said the so-called chained CPI never should have been included in the basic deal Congress is trying to achieve in the final hours of negotiations. However, he offered no details about his counter offer.

-- The House went back into session at about 4:35 p.m. to vote on roughly 13 bills remaining in the lame duck session but unrelated to the potential fiscal deal. The House and Senate earlier agreed to a one-year extension on the farm bill. 

-- At about 4 p.m. Maine Republican Sen. Olympia Snowe said the provision her party included in its proposal -- the so-called chained CPI -- will not be part of the final deal.

Republicans put that proposal in a deal they offered Saturday night. The mechanism, they said, ensures that tax increase will not be used for new spending.

-- Senate Republicans and Senate Democrats were meeting separately at about 3:45 p.m., And Senate Leader Harry Reid is expected to make public statements on stalled negotiations after 4 p.m. 

-- A Democratic aide told Fox News at about 2 p.m. that lawmakers thought they were getting closer to a deal – extending tax cuts for families with less than $250,000 in income annually. However, the deal stalled when Republicans tried to add to the proposal changes to how Social Security benefits are calculated.

The Senate is trying to craft a compromise deal. The senators arrived at 1 p.m., then after roll call and some nominations adjourned until 3 p.m.

But Republicans then called for a higher threshold for the tax rates and added a controversial new formula for recalculating entitlement benefits. The Democrats say that was never part of the discussion for a smaller deal.

The Republicans and Democrats are meeting with their respective caucuses and conferences to see whether Senate Leaders Harry Reid and Mitch McConnell can put together a deal, which if approved would then go to the House.

Fox News anticipates an afternoon press conference near the iconic Ohio Clock to update reporters on negotiations.

This is the "Life Cereal" approach to legislating. Senate leaders will wait to see if "Mikey" will eat the cereal. If the Senate tries the cereal first and likes it,  then just like in the old-time TV commercial, the House will start to eat the cereal, too.

However, Tea Party loyalists in the Senate such as Jim DeMint, South Carolina; Rand Paul, Kentucky; Mike Lee, Utah; and Ron Johnson, Wisconsin, could throw a wrench into negotiations by filibustering Reid’s calling the bill to the floor.

That move could result in Reid filing a cloture petition just to get the bill on the floor. By their nature, cloture petitions don't ripen for two days. So the Senate would have to vote Tuesday to get cloture (needing 60 votes) and then file cloture again. So presumably they could vote on the final package Wednesday. Essentially, they would have to clear the 60-vote threshold twice.

Should Congress fail to reach a deal, a $500 billion mix of tax increases and federal spending cuts in 2013 would kick in after New Year’s Day.

If the Senate and House reach a fiscal compromise, it would likely just deal with renewing the tax cuts and maybe extending unemployment insurance.

Stopping the spending – known as sequestration -- is going to be difficult with so little time remaining.

How can the Senate originate a bill that has revenue implications when Article I, Section 7 of the Constitution states all revenue bills must originate in the House?

The chamber would take an existing House-passed bill, strip it down to its frame, then put in new legislative engine, bucket seats, a sunroof and XM/Sirius Radio.

In other words, it would have to fill the shell of the House-passed bill with the Senate agreement.

Meanwhile, the House is scheduled to consider at least 13 remaining bills in the lame duck session, including the farm bill.

The House adjourned at 2 p.m. to begin voting on 13 dog and cat bills -- named so because they're "strays."

The miscellaneous bills deal with drywall safety and recognizing the final surviving World War I veteran who died last year.

The House will debate those throughout the afternoon and then vote in the evening. The farm bill was not included in the docket released Saturday but is now a late addition.

On their face, the votes don't seem important. But they serve as "bedcheck" votes. It is highly likely that only 360-400 members are on the Hill for the votes because many of them were defeated in November or have retired.

So the whip operations in both parties need to assess who is present and  see who might be willing to vote on what.

The GOP will meet this evening following the vote series.

In addition, the Senate has approved the $60.4 billion Sandy relief bill. But the House has not crafted a bill at all. It's possible the House could load that bill (plus maybe a farm bill extension) into a final fiscal cliff product. But there appears no appetite to tackle such a big Sandy bill in the House. It’s too big and has few offsetting spending cuts.

This is also one of the reasons the House can't pass the farm bill.