This week’s child tax credit payments could be the last as Democrats struggle to advance Build Back Better Act

WASHINGTON – On Wednesday, families throughout the Northwest and across the country – some 36 million households – received the monthly payments of up to $300 per child that were a hallmark of the economic relief bill Democrats passed in March.

Since the first payments went out in July, the result of a provision that essentially transformed an existing tax credit into a child allowance for all but the wealthiest American families, a recent Columbia University analysis estimates they have lifted 3.6 million children out of poverty. But unless Democrats find a way to pass President Joe Biden’s signature social and climate bill, this week’s payments could be the last.

The roughly $2 trillion Build Back Better Act that passed the Democrat-controlled House on a near-party-line vote in November would extend the monthly child tax credit payments for another year, but that bill has yet to receive the support it needs from moderate Democrats in the Senate.

With Republicans united against the bill, Senate Democrats need all 50 members of their caucus to agree on the legislation. Sen. Joe Manchin, D-W.Va., has said he won’t support the legislation in its current form, which would raise revenue over a decade but spend that money in just a few years, a budgetary “gimmick” Manchin has said obscures the true cost of the bill if its provisions were extended.

Rep. Suzan DelBene, a Democrat whose district stretches from the Seattle suburbs to the Canadian border, has been one of the leading advocates for the revamped child tax credit, which in its previous form was worth a maximum of $2,000 per child each year and was not available to the poorest families. While the Build Back Better Act would extend the credit’s annual value of $3,000 to $3,600 for just one more year, it would permanently make the credit available to low-income parents who didn’t earn enough to qualify for it in the past.

“In a few months, the expanded Child Tax Credit has had a transformational impact for American families,” DelBene said in a statement Wednesday. “But we cannot stop here. Americans risk losing this progress if we do not continue President Biden’s historic middle class tax cut.”

After the House passed a $3.5 trillion version of the Build Back Better Act in August, opposition from Manchin and other moderate Democrats forced the White House to propose cutting the legislation’s price in half. That led to a battle among Democrats, with moderates arguing the party had to jettison some programs to pay for others. Meanwhile, the Congressional Progressive Caucus, led by Rep. Pramila Jayapal of Seattle, pushed for short-term funding for all the party’s priorities, wagering that Americans would quickly see the benefits of those programs and support extending and funding them either through federal borrowing or more tax hikes.

But an NPR-Marist poll released Dec. 9 suggests the six-month test run of the expanded child tax credit hasn’t drummed up the kind of support for the payments Democrats were hoping for. While the Internal Revenue Service estimated earlier this year the parents of 88% of children would automatically receive the monthly benefits, just 59% of parents in the December survey reported getting the payments.

The poll also found Democrats have a perception problem, with just 47% of people surveyed giving them credit for the monthly child benefits and 9% crediting Republicans, despite Democrats passing the law in March with zero GOP votes.

DelBene, who leads the centrist New Democrat Coalition, advocated a longer extension of the child tax credit, but progressives won out as Democrats shrank the bill’s price tag by funding programs – including college tuition assistance and subsidies for health insurance and child care – for just a few years.

In an estimate released Dec. 10, the nonpartisan Congressional Budget Office projected making the bill’s provisions permanent would increase its total cost by $2.8 trillion. The White House has rejected that estimate, with Press Secretary Jen Psaki on Monday calling it “a fake score about a bill that doesn’t exist,” but Democrats maintain they want to extend the programs.

Now, that all-or-nothing approach appears likely to yield nothing – at least before the monthly child tax credit payments expire at year’s end.

In addition to needing to win over Manchin and Sen. Kyrsten Sinema, D-Ariz., Democrats can’t pass the Build Back Better Act until the Senate parliamentarian – a sort of nonpartisan referee – rules that all the bill’s pieces can be passed through a budget provision Democrats are using to bypass a Republican filibuster. That makes passing a bill by the end of 2021 all but impossible.

While Republicans have universally opposed both the March bill that revamped the child tax credit and the Build Back Better Act that would extend it, objecting to their high cost, some GOP lawmakers have signaled they may support a stand-alone bill to make a monthly child benefit a permanent part of the American social safety net. In February, Sen. Mitt Romney, R-Utah, proposed a similar program to give parents $250 to $350 per month for each child.

Democrats’ decision to include the child tax credit extension as part of a bigger package makes it hard to gauge GOP support for a stand-alone bill. Spokespersons for Sens. Mike Crapo and Jim Risch said neither of the Idaho Republicans would take a stance on a hypothetical bill without seeing its details.

Rep. Russ Fulcher, a Republican who represents North Idaho, earlier this year introduced the “One Subject at a Time Act,” a bill that would ban the wide-ranging legislative packages Congress has come to rely on. In a statement, he declined to weigh in on the monthly child tax credit but said lawmakers should consider the issue on its own.

“I believe Congress should be giving each legislative topic the opportunity to consider the idea on its own merit, rather than shoving it in a nearly 3,000 page bill that covers hundreds of topics,” Fulcher said, noting that he and other Republicans doubled the maximum child tax credit from $1,000 to $2,000 per year as part of the 2017 tax bill they passed over Democratic opposition.

Like all other Republicans, Spokane Rep. Cathy McMorris Rodgers also voted for that 2017 bill and has opposed Democrats’ legislation to turn the credit into monthly payments.

While Democrats in Congress have mostly avoided speculating on a stand-alone bill to extend the monthly payments, Sen. Patty Murray, D-Wash., suggested she may be open to a different approach if her party can’t pass the Build Back Better Act soon.

“This is about giving parents in Spokane some breathing room so that they can buy diapers or formula – to take a little bit of stress off their shoulders,” Murray said in a statement. “The Child Tax Credit is changing lives and creating opportunity in every community in every part of Washington state. I am ready to do whatever needs to be done to extend the Child Tax Credit.”

If Democrats pass a bill to extend the benefit in the new year, they could potentially send missed payments to families retroactively. Because families received the monthly payments only starting in July, parents can claim the remaining credit when they file their taxes for 2021.