By Ben Weyl, CQ Staff

Senate Democrats have scrapped plans to take up their own legislation to ease securities regulations for smaller companies, an unexpectedly swift submission to House Republicans in the debate over how best to spur job growth in a period of persistently high unemployment.

Senate Majority Leader Harry Reid’s agreement to take on a measure already approved by an overwhelming margin in the House is likely to speed the way toward the bill’s final passage and illustrates the strong pull for lawmakers to take actions seen as promoting business growth and jobs.

The Nevada Democrat said Tuesday the Senate would vote on the House bill (HR 3606), which is touted by supporters as a jobs measure, rather than taking up a Democratic alternative that he earlier said the Senate would consider.

The House last week passed the bill, intended to ease access to capital for small businesses and allow them to more easily launch initial public offerings, with broad bipartisan support, and President Obama has said he would sign it into law.

“We have no problem with the IPO bill we got from the House,” Reid said. “How could we? It got 390 votes in the House. The president of the United States supports it. We support it. We want to get this done, and we’ll do it just as quickly as we can.”

Senate Democrats had been expected to roll out their version of the bill this week.

Sen. Charles E. Schumer, D-N.Y., a strong backer of similar legislation, had said the Democrats’ measure would include additional investor protections. Consumer advocacy groups have expressed concern with some of the House bill’s provisions in that they say would leave investors vulnerable to fraud. A Senate Democratic aide said as late as March 9 that a new measure would be offered that would not include some of the proposals included in the House-passed bill.

Now Democrats are changing course. Reid said the lopsided House vote “was fairly very significant in my thought process.” Indeed, Reid may have found it difficult to modify the legislation in a way to appease liberals without losing the support of Republicans.

The majority leader also did not have an alternative bill ready. Although the Senate Banking, Housing and Urban Affairs panel held numerous hearings on the issue, most recently on March 6, it did not mark up any legislation.

It is unclear when the Senate will take up the bill. Republicans are pushing for consideration after passage of a surface transportation bill (S 1813), which is expected Wednesday. Reid has said the Senate could turn to the securities measure after the highway bill, but he also wants take up confirmation of a number of judicial nominations and has set up 17 cloture votes, which could take days to complete if Republicans insist on using up all the allotted time.

Package of Proposals

The House package combined several proposals focused on smaller businesses. One bill (HR 2930) would permit “crowdfunding,” or the use of social media and the Internet, to finance new businesses by allowing companies to accept and pool securities issuances up to $1 million without registering with the Securities and Exchange Commission.

The package also includes provisions to create a transitional category for some small and medium-sized companies. Called an “on ramp,” the classification would phase in new regulatory requirements for qualifying companies to help reduce the costs of selling shares to the public. Schumer has been a prominent supporter of such a proposal, which he said would spur companies to go public and gain greater access to capital investment.