WASHINGTON—The White House and congressional leaders reached a tentative deal Monday on a two-year budget plan that also would raise the federal debt limit.
If approved by Congress, the broad pact would allow House Speaker John Boehner(R., Ohio) to resolve two of the thorniest fiscal hurdles before he resigns later this week. If it fails, it could leave the U.S. government a week away from potentially being unable to pay all its bills.
The plan is designed to remove the risk that the government might default and diminish the prospect of a partial government shutdown in December. It would suspend the debt limit through mid-March 2017 and boost spending by $80 billion through September 2017. Lawmakers still would need to pass detailed spending bills by December, likely in one combined measure.
For it to pass the House, the pact will need to quickly win backing from most Democrats and at least a few dozen Republicans who have frequently balked at spending and debt-ceiling bills they say don’t do enough to shrink the budget deficit.
At the same time, the White House and GOP leaders will have to make sure the provisions used to pay for the deal don’t alienate liberal Democrats, who could oppose changes to safety-net programs.
On Nov. 3, the Treasury will exhaust emergency cash-management measures that it has employed since March if the debt limit isn’t increased. Congress, meantime,faces a Dec. 11 deadline when funding for the government runs out.
Congressional Republicans have been torn apart by intraparty feuds, resulting in Mr. Boehner’s surprise decision last month to resign. Still, he has stitched together a few bipartisan accomplishments this year, including a payment-funding fix to Medicare this spring and trade-negotiation authority this summer.