U.S. House fails to pass FAA extension, hurricane tax relief

By David Shepardson

WASHINGTON (Reuters) - The U.S. House of Representatives on Monday failed to approve a bill to allow the Federal Aviation Administration to continue to operate and a package of tax relief bills to aid hurricane victims after ranking Democrats objected.

Authorization for the FAA is set to expire on Saturday. The bill would have extended the agency for another six months as Congress debates whether to privatize the country's air traffic control system and considers new airline passenger protections.

The bill, which was considered under fast-track rules that require two-thirds of members to support it, failed on a 245 to 171 margin.

House Democratic leaders on Monday had urged their colleagues to oppose the measure, citing Republican's decision to only extend some healthcare programs and refusing to allow immigration legislation.

"Democrats support reauthorization of the FAA, which is long overdue as a result of Republicans' failure to craft a bill that can obtain bipartisan majority support," the statement said. "It is outrageous that the majority is hijacking the must-pass FAA bill as a vehicle for its pet priorities."

House Majority Leader Kevin McCarthy said in a statement after the vote the House will take up the issue again. "It didn’t take long for Democrats to snap back into their partisan corner. The American people can’t stand this nonsense," McCarthy said.

President Donald Trump in March proposed handing over control of U.S. air traffic control to a privately-operated board, but has faced resistance among Democrats and owners of private planes.

Major U.S. carriers, including American Airlines, United Airlines, Southwest Airlines and JetBlue Airways, all back the privatization proposal.

The bill would have also extended three healthcare programs, but would not extend a children's healthcare program and Community Health Centers that are set to expire on Saturday, which is the end of the budget year.

Democrats want to force a vote to reverse Trump's decision to overturn an Obama administration order shielding from deportation immigrants who came to the United States illegally as children.

The bill would make it easier for people with hurricane losses to write them off on their taxes, eliminating a requirement that personal losses must exceed 10 percent of adjusted gross income to qualify for a deduction.

It would also give hurricane victims penalty-free access to retirement funds and temporarily suspends limitations on the deduction for charitable contributions to hurricane relief made before year-end.

The bill provides a tax credit for 40 percent of wages, up to $6,000 per employee, paid by a disaster-affected employer in certain disaster areas.

(Reporting by David Shepardson; editing by Diane Craft)

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