Senate to kick off Wall Street reform debate shortly after noon

The Senate will begin debate on the Wall Street reform bill shortly after noon Thursday, when lawmakers return from a funeral for civil rights leader Dorothy Height.

Lawmakers will immediately consider a substitute amendment offered by Senate Banking Committee Chairman Chris Dodd (D-Conn.) and Agriculture Committee Chairman Blanche Lincoln (D-Ark.).

{mosads}Republicans say Dodd has agreed to drop a $50 billion fund to liquidate large, troubled financial institutions. But senior Democratic aides say no guarantees have been made to Republicans and their concerns “will be worked out on the Senate floor.”

A spokeswoman for the Senate Banking Committee did not return a request for comment.

The floor debate is expected to stretch over the next two weeks, giving Senate Democrats a chance to pass the legislation by mid-May.

Several Democrats have already offered amendments to the bill.

Sen. Russ Feingold (D-Wis.) has proposed one to repeal the provision of law that provides members of Congress with automatic pay raises.

Sen. Ron Wyden (D-Ore.) has unveiled another to require the sellers of financial products to disclose any financial interest they might have in the decline of their products’ value. The amendment is a response to allegations Goldman Sachs sold an investment fund to clients that was designed to fail.

Sen. Sherrod Brown (D-Ohio) has offered an amendment to impose leverage and liability limits on financial companies.

Sens. Jeff Merkley (D-Ore.) and Carl Levin (D-Mich.) say they will offer an amendment to close the door on all proprietary trading by banks. Levin said the Dodd bill would allow federal regulators to make some exceptions to allow banks to bet their own capital on trades.

The Merkley-Levin amendment could prove controversial as many Democrats probably will support it while banks will oppose it vigorously.

Majority Leader Steny Hoyer (D-Md.) said Thursday that House Democrats expect to negotiate final changes to the reform bill in a bicameral conference meeting.

Democrats skipped conference negotiations for the last major bill they passed, on healthcare reform, because leaders did not think they could muster a single Republican vote to approve changes sought in the House.

“I think we’re going to pass this piece of legislation through the Senate, we’ll have a conference report, and we’ll come out with a strong bill,” Hoyer said during an appearance on CNBC.

Michael O’Brien contributed to this report.