Senate Panel Votes Transit Aid in New Reagan Rebuffs : Student Loans Also Restored

The Republican-controlled Senate Budget Committee, defying President Reagan at nearly every turn, today rejected the Administration’s proposals to end federal subsidies for Amtrak passenger rail service and eliminate federal aid for mass transit, and refused to make sharp cuts in student loan programs.

Choosing again and again to freeze domestic spending at current levels rather than make deep cuts, the panel also rejected Reagan’s call to abolish the Urban Development Action Grant program and the Economic Development Administration.

“The package that is emerging is the Democratic freeze,” said Sen. Dan Quayle (R-Ind.) as a unified Democratic minority, joined by a shifting group of Republicans, fought off Reagan’s proposals for deeper reductions and outright termination of programs.

Committee aides calculated that over two days of voting, the committee has found $6.2 billion in deficit savings from domestic accounts--$10.9 billion less than Reagan requested for the same programs--with controversial decisions still to come on health and Social Security.

Fewer Savings Possible

The actions also put the panel on a path that would result in far less than the $50 billion to $60 billion in savings that Senate Republican leaders have made their goal.

Several committee members, including Sens. Mark Andrews (R-N.D.) and Ernest F. Hollings (D-S.C.), architects of a comprehensive freeze proposal, also favor higher taxes to reduce deficits, and are expected to make a formal proposal to the committee in several days. Reagan opposes raising taxes.

The committee’s domestic savings came on top of an estimated $21.1 billion yielded by the committee’s bipartisan vote Tuesday to cut sharply into the Administration’s defense budget.

But as the decisions unfolded on domestic programs, Sen. William L. Armstrong (R-Colo.) complained, “We have given up everything we saved on defense.”

Trying to Cut Deficit

The committee, drafting spending guidelines for Congress to follow, is seeking cuts to reduce a deficit estimated to rise to $230 billion or higher in the 1986 fiscal year without any changes in spending or taxes.

The vote on Amtrak was 13 to 9 to accept a proposal from Sen. Daniel Patrick Moynihan (D-N.Y.) to freeze subsidies at current levels rather than eliminate them, as the President proposed, at a savings of $600 million.

“We just can’t bear to get rid of a railroad. It’s part of our heritage,” Sen. John C. Danforth (R-Mo.) said during debate. “But on some routes, it would save taxpayers money to greet passengers at the train station and just give them plane tickets.”

Mass Transit Grants

In other action, the committee:

--Voted for a freeze on spending in federal operating grants for local mass transit systems, a program Reagan wants to eliminate. The same vote called for creation of a new type of loan fund for mass transit construction, another program the Administration proposed killing.

--Recommended maintaining the Appalachian Regional Commission at current levels, rejecting Reagan’s proposal to eliminate it.

Sen. Donald W. Riegle Jr. (D-Mich.) led the move to preserve the urban development grants, a Carter Administration program that backers say has helped revitalize declining cities. “It’s helping an area that’s in deep trouble get out of trouble,” Riegle said, noting that hotels built with program funds create construction jobs as well as steady employment for service employees afterward.

Armstrong argued against continuing the program, noting that many beneficiaries of the program are corporations. “In many cases we’re taxing the poor to subsidize the affluent,” he said.