Senate Republicans are proposing changes to a key biofuel tax credit and creation of a new $25 billion fund for rural hospitals as GOP leaders work to pass the sweeping budget reconciliation bill needed to enact President Donald Trump’s spending and tax priorities.
The 940-page One Big Beautiful Bill Act released late Friday also includes some easing of new restrictions on Supplemental Nutrition Assistance Program benefits.
In a crucial procedural vote, the Senate voted 51-49 Saturday night to take up the legislation. Debate was expected to continue through Sunday.
Under the latest version, able-bodied parents of school-age children 14 or older would be subject to work requirements for the Supplemental Nutrition Assistance Program under the legislation. Under the House version of the bill, the work requirements would hit parents with children as young as 7. The Senate Agriculture Committee originally proposed to raise that age from 7 to 10, partly out of concern about state laws that make it illegal for children as young as 7 to be left alone. The committee has now raised the age to 14. The legislation also exempts American Indians from the rules.
The bill retains a ban on immigrants getting SNAP benefits unless they are citizens or have permanent residency but the original exemption for Cuban immigrants has been expanded to include Haitians and immigrants from Micronesia, the Marshall Islands and Palau. The increased exemptions helped address concerns raised by the Senate parliamentarian about compliance with rules for the budget reconciliation process.
Senate Agriculture Committee Chairman John Boozman, R-Ark., told Agri-Pulse the age of children that triggers the SNAP work requirement was raised to mirror the new Medicaid requirement and to address concerns that it would be "difficult to leave alone" kids under 14.
Republicans considered but ultimately dropped the idea of offering grants to states to offset the impact of a new state cost-share requirement for SNAP, he said. With the vote of Sen. Lisa Murkowski, R-Alaska, on the line, the GOP instead created exemptions from the cost-share requirements for Alaska and Hawaii, which have among the highest SNAP error rates. Under the original text, only states with error rates below 6% were exempt from the cost-share.
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For the committee's top Democrat, Amy Klobuchar of Minnesota, told Agri-Pulse the cuts to SNAP still go too far. The cuts are “going to affect not only people who depend on assistance, like seniors and veterans and people with kids, but also everything from farmers who produce the food, who are already suffering under the Trump tariffs, to grocery stores in rural areas," she said.
The Congressional Budget Office estimates the bill would cut projected SNAP spending by $185.9 billion over 10 years, leaving a net reduction of $120 billion after accounting for SNAP savings that would be rolled into farm bill programs.
The Senate bill now mirrors a House provision limiting the 45Z clean fuels tax credit to North American feedstocks. The Senate Finance Committee's original version would have allowed the use of foreign feedstocks such as used cooking oil.
However, the tax credit would only be extended from 2027 to 2029, not 2031, as the Finance Committee originally proposed. The credit would remain transferable. The Senate provision also would exclude the use of indirect land use change, or ILUC, in calculating the environmental impact of feedstocks. The 45Z credit was created by the 2022 Inflation Reduction Act.
The 40A credit for biodiesel plants that produce less than 60 million gallons a year also would be extended and increased. Eligible producers would get an extra 20 cents per gallon on the first 15 million gallons.
The $25 billion fund for rural hospitals represents a bid by GOP leaders to win support from senators worried about the impact of limits on Medicaid provider taxes, which are used to attract federal matching funds for the program.
The bill would create a new Rural Health Transformation Program funded with $10 billion in fiscal 2028 and 2029, $2 billion in fiscal 2030 and 2031, and $1 billion in 2032. To obtain a share of the funding, states would have to develop detailed plans for bolstering rural hospitals and improving rural health outcomes.
Some GOP senators, including Appropriations Chair Susan Collins of Maine, who were concerned about the impact of the Medicaid cuts in their states had sought as much as $100 billion for the fund.
The budget reconciliation process allows Republicans to pass the bill with a simple majority and no Democratic support, but Republican leaders have little room for error since they only narrowly control the chamber, 53-47.
The bill clearly faced serious headwinds Saturday afternoon. Sen. Thom Tillis, R-N.C., announced in a post on X that he couldn’t support the bill because of the Medicaid cuts. “The Senate version of the One Big Beautiful bill contains significant changes to Medicaid that would be devastating to North Carolina, and I cannot support it,” he said.
Later, Tillis told reporters that the House bill's Medicaid cuts would be "manageable" but that an additional $200 billion in the Senate version would "be very problematic in many states to implement."
To appease northeastern Republicans whose votes are needed in the House, the Senate measure would temporarily raise the deduction for state and local taxes to $40,000 from the $10,000 cap imposed by the 2017 law. The Senate Finance Committee had originally proposed to retain the $10,000 limit.
The Senate legislation's increased funding for farm programs includes increases in Price Loss Coverage program reference prices and increased crop insurance premium subsidies. Unallocated money for conservation programs authorized by the Inflation Reduction Act would be rolled into the farm bill baseline, permanently increasing the programs' funding levels.
The bill also would expand business expensing provisions and permanently extend key benefits of the 2017 Tax Cuts and Jobs Act that are set to expire this year, including the 20% deduction for pass-through business income. The estate tax exemption would be raised to $15 million per person, or $30 million for a married couple.
“The Big Beautiful Bill contains all of President Trump’s domestic economic priorities. By passing this bill now, we will make our nation more prosperous and secure,” Senate Budget Committee Chairman Lindsey Graham, R-S.D., said in a statement.
This report has been updated with more details and the outcome of the motion to proceed Saturday night.
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