(AP Photo/J. Scott Applewhite)
The revised estimate suggested there would be no interruption in assistance in areas battered by disasters such as Hurricane Irene and last summer's tornadoes in Joplin, Mo., and also that lawmakers could act quickly on gridlocked legislation that is needed to keep the government running normally when the new budget year begins on Saturday.
Even so, there was no formal announcement that the impasse had been resolved. As a result, it was unclear what the immediate impact would be in the Senate, where a late-afternoon vote was set on legislation that combined the two issues -- short-term disaster relief and longer-range overall government funding -- into one.
It was just the latest in a string of political standoffs between Democrats and Republicans over deficits, spending and taxes that have left many Americans soured on Congress.
A spokeswoman for the Federal Emergency Management Agency, Rachel Racusen, said FEMA had $114 million left in its disaster relief fund, enough to last until Thursday or Friday, the final business day of the current budget year. She said the exact timing would depend on the number of emergency victims who apply for aid, and whether any new disasters occur.
FEMA officials had said previously the funds would run out early this week. That concern prompted the Obama administration a few weeks ago to ask Congress to approve a replenishment to tide the agency over through the Sept. 30 end to the fiscal year.
House Republicans agreed to provide $1 billion and include the money in a bill that also provides money for most federal agencies for the first few weeks of the 2012 budget year. At the same time, they insisted on cutting spending elsewhere in the budget by $1.5 billion to prevent the deficit from rising, an amount later raised to $1.6 billion.
That, in turn, produced a quick attack from Senate Democrats, who opposed cuts and sought to turn the issue to political advantage.
The dispute took on the characteristics of earlier clashes that have rattled financial markets and coincided with a historic plunge in poll ratings for Congress. Democrats accused Republicans of acting recklessly, while GOP lawmakers said Democrats wanted to perpetuate policies that have pushed red ink to astronomical levels.
"I mean, do they want the government to shut down? Do they want FEMA to close?" Senate Majority Leader Harry Reid said at one point last week as the controversy grew.
The Senate Republican leader, Mitch McConnell of Kentucky, responded, "If there's any lesson we can draw from the debates we've been having here over the last six months, it's that the American people won't accept that excuse anymore. The whole, 'that's the way we've always done it' argument is the reason we've got a $14 trillion dollar debt right now."
While it was unclear precisely how long FEMA's remaining funds would last, one official said the agency began conserving funds last month as Hurricane Irene approached the U.S. mainland, limiting aid to individual disaster victims and to state and local expenses for immediate needs such as removing debris and building sand bag barricades.
Funding of $450 million has been put on hold for longer-term needs such as reconstruction of damaged roads, the official said. In addition, the agency has been able to reclaim unused money from past disasters, according to the official, who spoke on condition of anonymity, citing lack of authority to discuss the matter publicly.
Associated Press writer Alan Fram contributed to this story.