MINIMUM WAGE HIKE APPROVED : WATER, INSURANCE BILLS CLEAR CONGRESS.

Byline: Eric Schmitt The New York Times

Rushing toward a monthlong recess, Congress gave final legislative approval Friday to a variety of bills that would raise the federal minimum wage, make drinking water safer and guarantee that workers' health insurance was portable from job to job.

The lawmakers then sent the legislation to the White House for President Clinton's signature, which seemed assured.

The minimum-wage increase, the first since 1990, was approved by overwhelming majorities in both houses Friday.

The bill provides for the minimum to rise by 90 cents an hour, to $5.15, in two stages: by 50 cents Oct. 1 and an additional 40 cents Sept. 1, 1997. More than 10 million Americans, who currently earn from $4.25 to $5.15 an hour, would be affected.

But in the last-minute rush that also produced sweeping changes in welfare policy earlier this week, Republicans said, they ran out of time to vote on a bill clamping down on illegal immigrants. Prospects for the measure are unclear; when Congress takes it up in September, Democrats are expected to object to a provision they say would deny public education to children who are in the country illegally.

After months of partisan bickering, Republicans in particular crowed about the flood of legislation that broke loose this week under their stewardship.

``We've seen Congress go from gridlock to Olympic gold,'' said Sen. Trent Lott of Mississippi, who took over as the majority leader from Bob Dole on June 12.

But Democrats scored their biggest political coup since Republicans seized control of Congress in 1995 by winning a 90-cent increase in the minimum wage, overcoming fierce opposition from most Republican leaders.

``What a difference a year makes,'' said Rep. Gene Green, D-Texas. ``This Republican majority passes a minimum wage increase - the world has definitely turned upside down. The American people brought the Republican majority to this point kicking and screaming.''

Both Republicans and Democrats claimed credit for the health insurance agreement that will enable American workers, millions of them with medical problems, to change jobs without fear of losing their coverage.

The Senate approved the House-Senate agreement Friday night by a vote of 98-0. The House passed the legislation Thursday by a vote of 421-2.

Sen. Nancy Kassebaum, R-Kan. who co-sponsored the bill with Sen. Edward Kennedy, D-Mass., said:

``Every American who has played by the rules will be able to keep their health insurance coverage even if they change jobs, lose their job or have a pre-existing illness. It is a historic step forward.''

Kennedy said the legislation ``will end many of the most serious health insurance abuses and provide greater protection to millions of families.''

Under the bill, insurers would be prohibited from denying anyone coverage because of health problems that had existed for more than 12 months. If someone had insurance for that long or longer, he or she would have to be accepted by the new employer's insurer, or with an individual policy.

In a provision that stirred bitter arguments over the past several weeks, the legislation also creates up to 750,000 tax-sheltered medical savings accounts, an experimental version of a market-driven program that many conservative lawmakers demanded.

House-Senate negotiators dropped from the agreement a requirement that insurers cover mental health problems the same as physical ailments. Sen. Pete Domenici, R-N.M., the provision's chief sponsor, declined to hold up final passage but vowed he would introduce the measure again.

``This issue is not going away,'' said Domenici.

A provision to help American Home Products Corp. by adding two years to its patent for the arthritis drug Lodine was withdrawn Friday after Sen. Paul Wellstone, D-Minn., objected, calling the provision a special-interest favor that would hurt consumers. Drug prices fall substantially after patents expire because the companies lose their monopolies and generic competitors force prices down.

Lott had inserted the provision just before the bill moved out of a House-Senate conference committee earlier this week. Lott said the company deserved the patent extension because a rival, Monsanto Co., had received an extension for a similar product, Daypro.

American Home Products, based in Madison, N.J., has been a heavy contributor to Republican causes. Since 1991, the company has given $50,000 to the Republican Party and its political action committee has given $81,500 to Republican candidates. In that same time, the Democratic Party has received nothing from the company and Democratic candidates have received $49,900, according to Public Citizen, a public-interest lobbying organization.

To sweeten the minimum wage hike for Republicans who say it is a job-killer for mom-and-pop stores, the House-Senate agreement also provided for $21 billion in tax breaks over 10 years, ranging from more rapid equipment write-offs for businesses to a $5,000 tax credit for couples who adopt a child.

The House approved the wage-tax agreement by a vote of 354-72, with 160 Republicans joining 193 Democrats and one independent in favor. With Election Day only three months away, 67 more Republicans voted for the agreement Friday than when the House approved its version May 23.

Rep. Dick Armey of Texas, the majority leader, who had vowed to fight the wage increase ``with every fiber of my being'' and asserted this week that a pay raise four out five Americans supported was ``an inside-the-Beltway issue,'' voted against the agreement.

The Senate approved the bill by a vote of 76-22, with 31 Republicans joining 45 Democrats in favor. The 22 nays were all Republicans. Kennedy, who led an underdog campaign to push the wage increase through the Republican-controlled Congress, said the increase and the health insurance bill amounted to a ``doubleheader victory.''

The increase will put an additional $1,800 in the pockets of minimum-wage workers with full-time jobs, who now earn $8,500 a year. Most of these wage-earners are women, the Labor Department said.

In a concession to small businesses, the bill would allow employers to pay a sub-minimum wage of $4.25 an hour to new workers under the age of 20 for the first 90 days of employment.

The House and the Senate also overwhelmingly approved a House-Senate agreement to revise federal drinking water standards and help states pay to finance improvements in municipal water systems. The vote in the House was 392-30; the Senate passed it, 98-0.

Clinton is expected to sign the agreement, but environmentalists expressed disappointment because it did not provide as much money to the states immediately as had been expected.

MAJOR LEGISLATION

Here's a quick rundown of major legislation that Congress approved this week.

MINIMUM WAGE: The bill increases the $4.25-an-hour minimum wage by 90 cents in two steps, to $4.75 on Oct. 1 and to $5.15 on Sept. 1, 1997.

HEALTH INSURANCE: The bill helps workers keep insurance if they change jobs and makes it easier for people with ``pre-existing'' conditions to get health insurance.

WELFARE: The bill places a five-year lifetime limit on welfare benefits for an adult, requires most heads of families to go to work within two years of being on welfare, and turns over programs to states.

DRINKING WATER: The bill authorizes $7.6 billion for loans to improve deteriorating water systems around the country and requires that customers be notified of chemicals and bacteria in the water they drink.

CAPTION(S):

Box

Box: MAJOR LEGISLATION (see text)