Congressional negotiators on Thursday narrowed their differences over how much to spend on a massive highway and mass transit bill (search), but put off until September any final decisions on legislation that is certain to play into election-year politics.

The House, taking its cue from a new White House position on acceptable spending, proposed spending almost $299 billion over the next six years on surface transportation building and safety programs. The actual spending under that proposal would be nearly $284 billion after the voiding of some $15 billion in contracts that have not been carried out.

"It's not adequate in dealing with the infrastructure needs of the country," acknowledged House Ways and Means Committee Chairman Bill Thomas, R-Calif., (search) in outlining the offer at a House-Senate conference. But he said this was a level that would win the president's signature. "You are getting what is doable."

The White House for months has threatened to veto any bill that exceeded $256 billion, stressing the need to control the rising federal budget deficit (search). But the administration has been under pressure from its business allies and lawmakers from both parties to assure passage of a bill that would create tens of thousands of new construction jobs and meet the needs of the nation's overcrowded and unsafe highway system.

Democrats, hoping to win back both the White House and control of Congress in the November election, have cited the long-delayed highway bill as one of administration's major legislative failures.

Senate negotiators agreed to consider the House offer over the six-week summer recess that begins at the end of this week. Senate Environment and Public Works Chairman James Inhofe (search), R-Okla., said that if a vote was taken that day the Senate would reject it as inadequate, but that compromise was possible.

Without an agreement, Congress late Thursday enacted a fifth temporary extension of the old six-year plan, which expired in September last year. The current extension, which maintains funding at levels set in that $218 billion plan, runs out at the end of July. Under the new stopgap measure, highway programs will continue to be funded through Sept. 24, and transit and other programs through the end of September.

The original Senate-passed bill called for $318 billion in spending. On Tuesday, Inhofe proposed a compromise figure of $301 billion, with $289 billion in guaranteed spending, but several of his fellow senators said that level was too small to end some of the inequities in the current system without cutting funds to some states.

Closely tied to the dollar issue is how federal highway money is distributed to the states. At present, states are guaranteed 90.5 cents back for every $1 they contribute to the highway trust fund, which is derived from the 18.4-cents-a-gallon federal gas tax. States that get back less than they receive have been pressing for a 95 percent guarantee.

Also at issue is how to pay for increased spending. The White House has warned that President Bush would levy the first veto of his presidency if the legislation raises taxes, increases the deficit or resorts to bonds. The House and Senate have been at odds over various proposals to increase revenues coming into the trust fund.