September 28, 2017 / 6:09 PM / a year ago

UPDATE 2-U.S. lawmakers approve FAA extension and hurricane tax relief

(Recasts with House approving Senate version)

By David Shepardson

WASHINGTON, Sept 28 (Reuters) - U.S. lawmakers on Thursday approved a bill extending the Federal Aviation Administration's authority to operate and spend federal money and a package of tax relief bills to aid hurricane victims, sending them to President Donald Trump for his signature.

Authorization for the FAA was set to expire on Saturday, the end of the budget year. The bill will keep the agency operating for another six months as Congress debates whether to privatize the country’s air traffic control system and considers new airline passenger protections.

The Senate passed the bill unanimously followed by the House of Representatives, which adopted the Senate version by unanimous consent.

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

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

Republican Senator Jerry Moran predicted on Thursday that the privatization proposal would not pass when the issue comes up next year.

The bill now awaiting Trump's signature also extends three healthcare programs, but would not extend a children’s healthcare program and Community Health Centers, which have authorizations that both expire on Saturday.

A version of the hurricane-related tax relief package approved by House lawmakers early Thursday had included Republican-backed flood-insurance provisions aimed at opening the market to lower-cost private insurance plans. But the provisions were stripped out by the Senate after Democrats said they would leave the federal flood insurance program with nearly $25 billion in debt and allow private insurers to focus on lower-risk policies.

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

One provision 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 tax relief package provides a tax credit for 40 percent of wages, up to $6,000 per employee, paid by a disaster-affected employer in certain disaster area. (Reporting by David Shepardson; Editing by Diane Craft and Tom Brown)

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