By Brian Gunn and Paul Moorehead

Tomorrow, October 17th, marks the deadline to extend the $16.7 trillion “ceiling” on additional borrowing by the United States government.  Senate Majority Leader Harry Reid (D-NV) and Minority Leader Mitch McConnell (R-KY) have agreed on a bi-partisan deal to reopen the federal government at sequestration funding levels of $986 billion through January 15, 2014 and raise the debt ceiling until February 7, 2014. 

The agreement establishes a budget conference committee to address broader budget matters, including the sequestration.  It also grants back pay to an estimated 800,000 furloughed federal workers.

The Senate agreement allows the U.S. Department of Treasury to use “extraordinary” measures to extend borrowing when the government approaches the debt limit and requires stricter efforts to verify the income of individuals who apply for subsidies under the Affordable Care Act.  The Senate is expected to vote on the agreement this evening.  Speaker of the House John Boehner (R-OH) has announced his plan to bring the Senate-passed bill to a vote in the House after the Senate takes its action. 

We will keep you apprised on further developments.

Source: Client Alert