IMF funding issue delays U.S. Congress Ukraine bill

WASHINGTON Tue Mar 11, 2014 7:56pm EDT

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WASHINGTON (Reuters) - U.S. lawmakers debated on Tuesday whether to include a shift in funding for the International Monetary Fund in a bill to address the crisis in Ukraine, raising concerns that the measure could be delayed for weeks.

The Senate Foreign Relations Committee had hoped to vote on Tuesday on a package that aides said would include aid for Ukraine and sanctions, as well as $1 billion in loan guarantees.

Members have been unable to agree on the IMF funding, which was requested by the Obama administration but is opposed by many Republican lawmakers.

Senator Bob Corker, the top Republican on the foreign relations panel, said he supported the IMF measure but did not think it should hold up a Ukraine bill.

"If we cannot get that done as part of this package, instead of holding the package up, I'd rather go ahead and pass the Ukraine-specific issues," he said.

Ukraine's government appealed for Western help on Tuesday to keep Russia from annexing Crimea, but the Black Sea peninsula, overrun by Russian troops, seemed fixed on a course that could formalize rule from Moscow within days.

Senator John Barrasso, a Republican of Wyoming, said he would introduce an amendment to expedite the supply of natural gas from the United States to Ukraine. But the measure is given little chance of being passed in the Senate, where it is not seen as bringing the Kiev government quick relief.

VOTE WEDNESDAY?

Corker said he hoped a Ukraine bill would pass before Congress leaves for next week's recess. The Foreign Relations Committee announced a business meeting for Wednesday, but did not say whether it would include a vote on a Ukraine bill.

The committee must approve the legislation before it can be sent to the full Senate. If approved by the Senate, the measure would have to pass the House of Representatives before being sent to President Barack Obama for his signature.

The Obama administration has been pushing Congress for a year to approve a shift of $63 billion from an IMF crisis fund to its general accounts to maintain U.S. influence at the lender and make good on a commitment from 2010.

The House passed a bill last week backing $1 billion in loan guarantees for Ukraine. It did not include the IMF funding. Some Republicans worry about the fund's lending to richer European nations and possible losses on IMF loans.

Some Senate Republicans said members of the party in the House wanted to trade the IMF funding for a change in tax rules the Obama administration proposed for certain tax-exempt groups, which they see an effort to unfairly target conservative organizations.

House Republicans declined comment, noting that they had already passed Ukraine legislation.

"It is increasingly clear that if Congress is going to act on this issue this week, the Senate should simply pass the House bill," a House leadership aide said.

Senator John McCain, an Arizona Republican, expressed frustration the IMF issue was holding up a bill.

"There should be nothing that impedes the Congress from speaking on the issue of Russia invading another country." he said. "If it's in or if it's out, none of that matters to me. What matters to me is that we get the message out."

In the House, a symbolic resolution condemning Russia's action in Ukraine passed by a 402-7 margin.

The resolution "is a very important declaration of support for the people of Ukraine during this crisis, condemning in clear and unmistakable terms Russia's unprovoked aggression," said Republican Representative Ed Royce, chairman of the House Foreign Affairs Committee.

(Additional reporting by Timothy Gardner, Anna Yukhananov and Patrick Temple-West; Editing by G Crosse, Leslie Adler and Peter Cooney)

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