Jobs bill on Senate docket

WASHINGTON (CNNMoney.com) -- When the Senate returns on Jan. 19, jolting the economy will be high on the to-do list.

The Senate plans to take a crack at a $154 billion jobs creation package that eked out of the House in December by a vote of 217-212.

Entitled "Jobs for Main Street," the bill aims to spur new construction jobs by spending $27.5 billion on highway projects and $8.4 billion on public transit. Another big piece would be $23 billion for education to prevent teacher layoffs as states continue to struggle.

The legislation would also allow the U.S. Small Business Administration to continue backing loans to small businesses.

More than half the bill's funding - or $79 billion - won't go to creating new jobs but could help the economy by continuing or extending lifeline programs for the poor and unemployed through the end of June. That $79 billion does not include a two-month extension of such benefits that President Obama recently signed into law.

This time a year ago, Congress and the incoming Obama administration were laying the groundwork for the first $787 billion stimulus package - the American Recovery and Reinvestment Act of 2009. Obama signed the massive bill in February after only a few weeks on the job.

The new package, while much smaller, has earned the derision of Republicans, who dubbed it "Son of Stimulus" and "Stimulus Two" while debating it on the House floor in December.

Indeed, outside experts say that, for better or worse, the House bill repeats a lot of the same things that were in the first stimulus bill. But it's nowhere near as comprehensive.

"They took the low-hanging fruit - a lot of the Recovery Act provisions - and applied additional monies," said Christian Dorsey, director of government affairs for the Economic Policy Institute, a liberal think tank. "The big pieces, $50 billion for infrastructure, and $50 billion for state aide, are tried and true Recovery Act."

The bill's biggest chunks direct more money to infrastructure projects and retaining public employees on the job.

But it also would also include the following expenditures:

• $1.18 billion to keep police officers employed
• $800 million for Amtrak to replace and rehab railroad cars and engines
• $500 million for airport projects
• $2 billion to back up loans for green technology
• $2 billion in loans and grants to improve water quality
• $1 billion to build and rehab rental housing for the most poor
• $65 million in rental assistance for the most poor
• $200 million for Americorp volunteer program and $500 million for summer jobs for disadvantaged youth

So far, the bill has garnered tepid support from many of the same business groups that championed the first Recovery Act stimulus bill, like the U.S. Chamber of Commerce and the National Association of Manufacturers. The business groups like the parts of the bill that pay for infrastructure investments.

"We remain concerned, however, that the House jobs bill doesn't go far enough to ensure long-term growth and create lasting high-paying jobs," said the National Association of Manufacturers spokeswoman Laura Narvaiz. "At a time when many of our members are still struggling financially, we would like to see a more comprehensive package that addresses long-term growth and helps preserve manufacturers' competitiveness."

This week, the Congressional Budget Office estimated the House jobs bill would add $65 billion to the deficit over the next 10 years.

That figure takes into account one sweetener to woo those worried about the cost. The House bill uses $75 billion of unspent federal bailout money originally intended for banks under the Troubled Asset Relief Program.

Yet, the Senate is expected to make some pretty drastic changes to the final bill, especially when it comes to its cost. In addition to finishing up the costly health care bill, the Senate has another fiscal pressure to deal with: raising the federal debt limit.

Also, the Senate may rewrite the bill to include some jobs creation measures that Obama called for in December, such as tax breaks for small businesses that create new jobs.

Congressional aides say the Senate will start working on the jobs bill after it finishes with health care. Democrats want to get work on health care completed by the president's State of the Union message, within the next month.

"Repairing our economy and creating jobs will remain at the forefront of our agenda this year," said Regan Lachapelle, spokeswoman for Majority Leader Sen. Harry Reid, D-Nev.