By Kerry Young and Niels Lesniewski, CQ Staff

House Republicans and Senate Democrats still have not resolved a dispute over offsetting new disaster aid, and the fight threatens to slow down a must-pass stopgap spending bill.

Rhetoric over the issue escalated Tuesday, when Senate Majority Leader Harry Reid, D-Nev., said he would continue to demand that new disaster aid be free of offsets and threatened to keep his chamber in session through next week’s scheduled recess if needed.

But his GOP counterpart, Minority Leader Mitch McConnell, was more sanguine, saying he was “confident” that the two parties would agree soon.

Congress is scheduled to leave at the end of the week, but lawmakers need to clear a continuing resolution (CR) before Oct. 1 to avert a government shutdown. And lawmakers from both parties are eager to replenish the Disaster Relief Fund, which has blown through its cash reserves covering the cost of a record number of disasters this year.

“Exactly how we get from where we are to the end of the trail by Thursday night, I couldn’t tell you, but I can confidently tell you we’re going to respond with assistance to those who are in need,” McConnell, R-Ky., said. “There won’t be a government shutdown. Congress always responds appropriately to disasters. We’re having a discussion about the appropriate way to do that.”

Reid is pushing legislation that would provide $500 million in immediate fiscal 2011 aid without offsets, while Majority Leader Eric Cantor, R-Va., along with House Republicans, want to provide $1 billion immediately, but would pay for that new expenditure by cutting funds for an energy-efficient car program.

Reid said Tuesday he will move to amend a House continuing resolution (HR 2608) to include a total of $6.9 billion in disaster relief money contained in an earlier Senate-passed appropriations measure (H J Res 66).

The House measure also includes $2.65 billion in fiscal 2012 disaster aid, on top of the $1 billion in fiscal 2011 money. The House is scheduled to vote on its measure Wednesday.

To prevail, Reid must hang on to most of the Republicans who backed his approach last week. He could lose only two of the 10 Republicans who voted with Democrats to pass, 62-37, the $6.9 billion for disaster aid without offsets. Many of Reid’s Republican supporters are from states hit hard by 2011 disasters, including Scott P. Brown of Massachusetts, who already has said he will continue to support the majority leader on this matter.

So far, there is no clear indication who will prevail, although the vote the House is scheduled to take Wednesday will be on a legislative vehicle for the CR that would expedite procedural matters in the Senate, an indication that leaders are aware that the issue needs to be resolved quickly.

Major Disaster Year

With 83 major disasters declared by President Obama in 2011, this year has surpassed the previous annual record, set last year when there were 81 presidential declarations. This spring brought severe storms and tornadoes in the Southeast and parts of the Midwest, while flooding has hit in many parts of the country. Late this summer, damage from Hurricane Irene put further pressure on the nation’s disaster relief fund, which has been whittled down to $257 million from about $800 million before Irene made landfall in late August.

With so many states experiencing disasters this year, Reid could maintain enough GOP support to prevail on the offset battle, said budget hawk Jim DeMint, R-S.C. It is not an outcome DeMint favors.