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BREAKING NEWS FROM CNBC’S KAYLA TAUSCHE: SENATE EYES DEAL TO RAISE BUDGET CAPS BY $300 BILLION OVER 2 YEARS – SOURCES

WHEN: Wednesday, February 7, 2018

WHERE: CNBC's "Squawk Alley"

Following is an unofficial transcript of CNBC's Kayla Tausche's breaking news on CNBC's "Squawk Alley" (M-F 11:00AM – 12:00PM) today Wednesday, February 7th. Following is a link to the full story and video on CNBC.com: https://www.cnbc.com/2018/02/07/shutdown-news-senate-seeks-deal-to-raise-military-spending.html.

All references must be sourced to CNBC.

KELLY EVANS: THERE'S SOME BREAKING NEWS OUT OF WASHINGTON ON THE BUDGET. LET'S GET DOWN TO KAYLA TAUSCHE WITH THOSE DETAILS NOW. KAYLA.

KAYLA TAUSCHE: HI KELLY. WE WANT TO GIVE YOU SOME DETAILS ABOUT A SPENDING DEAL CURRENTLY NEGOTIATED ON CAPITOL HILL THAT WOULD LIFT BUDGET CAPS PUT IN PLACE BY THE 2011 SEQUESTER DEAL BY NEARLY $300 BILLION OVER THE NEXT TWO YEARS. THAT'S ACCORDING TO A CONGRESSIONAL SOURCE AND A SENIOR WHITE HOUSE OFFICIAL. THE DEAL DISCUSSED AT PRESENT WOULD IN ITS FIRST YEAR RAISE MILITARY SPENDING BY $80 BILLION, AND SPENDING FOR ALL OTHER PROGRAMS BY $63 BILLION, ACCORDING TO OUR SOURCES. BUT IN YEAR TWO, THOSE WOULD GO UP. DEFENSE SPENDING WOULD INCREASE BY $85 BILLION, AND DISCRETIONARY SPENDING OR ALL OTHER FUNDING WOULD INCREASE BY $68 BILLION. THOSE ARE BIGGER UPTICKS THAN HAVE PREVIOUSLY BEEN REPORTED. THE DETAILS OF THE BIPARTISAN DEAL, INCLUDING A POTENTIAL DEBT CEILING COMPONENT, ARE STILL BEING DISCUSSED BUT COULD BE ANNOUNCED EARLY AS TODAY. OUR COLLEAGUES AT NBC NEWS ARE REPORTING THIS COULD COME OUT AT NOON ON THE SENATE FLOOR. GETTING SUPPORT IN THE HOUSE, THOUGH, WOULD BE AN UPHILL BATTLE FOR SPEAKER PAUL RYAN. DEMOCRATIC LEADER NANCY PELOSI HAS ASKED FOR MORE ASSURANCES FROM RYAN SINCE THE PACKAGE DOES NOT INCLUDE PROTECTION FOR DACA RECIPIENTS. MEMBERS OF THE HOUSE FREEDOM CAUCUS ALSO OPPOSED THE INCREASES TO NONDEFENSE SPENDING, SO WE'LL SEE WHERE THIS SHAKES OUT AND WHAT OTHER ELEMENTS OF THIS, INCLUDING DISASTER RELIEF AND CERTAIN TAX EXTENDERS ARE ACTUALLY PART OF THE PACKAGE WHEN IT COMES OUT POTENTIALLY NEXT HOUR. KELLY, BACK TO YOU.

EVANS: KAYLA, DOES IT HAVE TO HAVE ANYTHING ABOUT THE WALL IN THERE OR NO?

TAUSCHE: WELL I'M TOLD BY A SENIOR WHITE HOUSE OFFICIAL THAT THIS DEAL WILL NOT INCLUDE ANY IMMIGRATION COMPONENTS. WHETHER THEY FEEL LIKE THE WALL SHOULD BE TIED TO BROADER IMMIGRATION REFORMS THAT WOULD BE A SEPARATE DEAL,THAT STILL REMAINS TO BE SEEN. BUT SO FAR AS WE'RE HEARING TODAY, IT WOULD NOT.

For more information contact:

Jennifer Dauble
CNBC
t: 201.735.4721
m: 201.615.2787
e: jennifer.dauble@nbcuni.com

Emma Martin
CNBC
t: 201.735.4713
e: emma.martin@nbcuni.com

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