President-elect Trump and House Republicans in favor of raising the state and local tax (SALT) deduction cap discussed lifting the debt limit in legislative vehicles other than the “big, beautiful bill” of Trump’s policy priorities during a meeting at Mar-a-Lago over the weekend, Rep. Nick LaLota (R-N.Y.) and three other sources told The Hill.
The conversation included discourse about the different ways Congress could increase the debt limit, including through reconciliation — which Republicans could do on their own — or regular order, a process that would require buy-in from Democrats, LaLota and two of the sources said.
Trump did not say what his preferred strategy was, one of the sources said.
“We talked about different mechanisms,” LaLota, who was at the Saturday meeting, told The Hill on Sunday. “We did talk about different ways to resolve that challenge, reconciliation and regular order being among [them].”
“We were talking about where it should go,” one source, who was at the meeting and requested anonymity to discuss the sensitive topic, said of the debt limit. “And so we were tossing around ideas.”
Another source said some lawmakers suggested putting a debt limit increase in the government funding bill Congress will have to pass by the March 14 shutdown deadline or tying it to disaster aid for the California wildfires — a move that would dare Golden State Democrats to vote against the needed assistance.
“Some people said put it in the first reconciliation bill, some people [said] put it in the second reconciliation bill, some said put it in the negotiated funding bill that’s gonna be in March. … There were thoughts about tying it to aid for [Los Angeles], with the fires, all sorts of stuff,” the source said.
Three of the sources noted that the discussion about the debt ceiling was a general conversation, not done in great detail, and a brief part of the meeting.
The mere mention of alternative strategies, however, is significant, since Speaker Mike Johnson (R-La.) last week said it was his “intention” to increase the debt limit through the reconciliation process. It underscores the fact that the debt limit portion of the reconciliation package is among the most contentious provisions in the legislation, as some conservatives have a track record of opposing such efforts.
Trump did not weigh in on his preferred strategy, one of the sources said. Another source said Trump “wants it raised,” referring to the debt limit, but does not want it to be used as a “political weapon.”
“The question is, what’s the best vehicle to get it done without it being used as a political weapon,” the source said. “Obviously, there’s a lot that goes into all of this, so his bottom line is he doesn’t want it used as a political weapon against him by the Democrats.”
Three of the sources said Trump, during the conversation about the debt limit, expressed frustrations with the 2023 deal former Speaker Kevin McCarthy (R-Calif.) struck with President Biden to raise the borrowing limit for two years — a sentiment he has previously expressed publicly.
“I think he’s just unhappy with the date that Kevin McCarthy chose, and then it fell in his lap,” one of the sources said.
“He didn’t trash him; he was just very miffed about the date,” the other source echoed.
The discussion about the debt limit took place during Trump’s gathering with Republicans from New York, New Jersey and California who are in favor of lifting the SALT deduction cap, an issue these lawmakers have pushed for years.
During the meeting, Trump reiterated his desire to address the SALT deduction cap implemented under the Tax Cuts and Jobs Act (TCJA), which he signed into law during his first term. While taxpayers used to be able to deduct what they paid in state taxes from their federal taxes, now the amount is capped at $10,000, severely impacting those in states like New York, New Jersey and California.
The president-elect told members at the meeting that he did not know the SALT cap was such an issue until after the TCJA became law, three sources told The Hill. Two sources said he mentioned former New York Gov. Andrew Cuomo (D).
“He said ‘nobody ever called me,'” one source said. “He goes, ‘Cuomo never called me, this person never called me and said what are you doing?'”
Lawmakers present at the meeting said they left Mar-a-Lago with a commitment from Trump that he would work with them on addressing the SALT tax cap.
“He understands it completely. He agrees the cap on SALT needs to be lifted,” Rep. Mike Lawler (R-N.Y.), who was at the meeting, said on Fox News’s “Sunday Morning Futures.”
“There’s reason for all of us to negotiate in good faith. That’s why we went down to meet with President Trump. He understands this. And he said to us, ‘Look, I’m with you, come back with a number and let’s work through it,'” he added.
While the SALT-focused Republicans see the openness to raising the cap as good news, it is the change in the debt limit strategy that could be most consequential for moving Trump’s legislative agenda through Congress more quickly.
Trump has expressed anger that the debt limit will have to be raised during the first year of his new administration, and he does not want Democrats to use the must-pass measure as a leverage point to extract concessions — as Republicans did in 2023 under McCarthy. Trump called the timeline put in place by that deal “one of the dumbest political decisions made in years.”
Trump made a last-minute demand for Republicans to raise the debt ceiling in a December funding package but faced pushback from GOP fiscal hawks who want substantial spending cuts as a condition of raising the debt ceiling.
In light of that demand, Republicans struck a handshake agreement in December to raise the debt limit by $1.5 trillion and implement $2.5 trillion in spending cuts as part of the party-line bill with which Republicans are planning to address Trump’s priorities like the border, taxes, energy policy and more.Â
The Trump agenda bill will advance through Congress using the special budget reconciliation process, which can be used only once or twice each year, but bypasses the threat of a Democratic filibuster — and thus, Democrats would not be able to use it as leverage if it is in the reconciliation bill.
But getting all the Republican fiscal hawks in the tiny House GOP majority on board with the debt limit increase plan — by making enough cuts so that even the members who have never voted to raise the debt ceiling vote yes — could severely complicate the bill.
It is unclear, though, how Republicans could pursue an alternate strategy while also nullifying the risk of Democrats using the debt limit as a leverage point.
The conflicting priorities of different ideological factions of the House GOP were aired to Trump in his many meetings with different groups of lawmakers this weekend at Mar-a-Lago.
A Saturday afternoon meeting included members from blue states like New York, New Jersey and California, where many members have made raising the SALT deduction cap their main priority.
Reps. Young Kim (R-Calif.) and Andrew Garbarino (R-N.Y.), SALT Caucus co-chairs, said in a statement that the meeting was “productive.”
“Our constituents are burdened by the SALT cap, and President Trump committed to addressing this issue for our districts,” Kim and Garbarino said. “We had a productive meeting tonight and will keep fighting to resolve this critical issue so our constituents can keep more of their hard-earned money.”
Noticeably absent from the meeting of blue-state lawmakers, though, was Rep. David Valadao (R-Calif.) — one of two House Republicans left in Congress who voted to impeach Trump after the Jan. 6, 2021, attack on the Capitol.
Members of the Freedom Caucus joined Trump at Mar-a-Lago on Friday evening. Among the attendees was Rep. Chip Roy (R-Texas), against whom Trump in December had called for a primary challenge over his opposition to Trump’s push to raise the debt ceiling.
Billionaire Elon Musk, who Trump has named as a co-head of the forthcoming “Department of Government Efficiency” (DOGE), was also present at the Friday night Freedom Caucus dinner.
“Great night at Mar-a-Lago with the House Freedom Caucus. We joined President Trump and Elon Musk for dinner to talk about the path forward,” Rep. Eli Crane (R-Ariz.)Â wrote on the social platform X with a photo of the group.
And the chairs of House GOP standing committees met with Trump on Saturday evening.
