Key Lawmakers, White House Nearing Accord on Deficit Trims

Key congressional and White House budget officials appeared close to an agreement Thursday on a package of more than $13 billion in fiscal 1987 deficit-reduction measures--possibly enough to avoid the harsh and indiscriminate spending cuts that might occur early next month under the Gramm-Rudman law.

Among its provisions was a proposal to hire additional Internal Revenue Service employees to crack down on those who do not pay their full share of taxes. The move is a far less certain method of raising revenue than the leaders had hoped to use, but they found themselves unable to win much support for other alternatives, including excise taxes that President Reagan had promised to veto.

Other provisions included government asset sales and user fees for government services.

Rather than emerging through the usual legislative process, the plan was being shaped in an unusual negotiating session, which adjourned late Thursday, that included the chairmen of the House and Senate budget committees and White House Budget Director James C. Miller III.

“We can’t allow the system to operate under normal procedures because there’re not enough days to let the normal procedures work,” House Budget Committee Chairman William H. Gray III (D-Pa.) said. “We don’t have time for that.”

The immediate goal is to bring the projected deficit for fiscal 1987, which begins Oct. 1, to $154 billion or lower.

Unless a deficit-reduction measure becomes law by early next month, the Gramm-Rudman law could force spending cuts in a wide range of government programs. The Gramm-Rudman formula would divide the reductions equally between defense and domestic spending, hacking away at the deficit until it falls to $144 billion.

Congress could avoid the cuts simply by refusing to invoke the Gramm-Rudman law, but that would amount to ducking a commitment lawmakers made when they enacted the law late last year. Many have said it would be an embarrassing move to make only weeks before this fall’s elections.

Gramm-Rudman was an effort to bring the deficit under control and calls for a balanced budget by fiscal 1991. However, many of the moves being contemplated to reduce this year’s deficit could actually add to budget deficits in future years. Selling assets such as loan portfolios, for example, means that the federal government will no longer be reaping funds from repayment of those loans.

Senate leaders said they hoped to bring the plan to a vote on the Senate floor as early as today. A House vote was not expected until next week.