By Andrew Duehren 

WASHINGTON -- Some conservative House Republicans are asking President Trump to reject any agreement to set new spending levels and increase the government's borrowing limit without significant spending cuts, injecting further uncertainty into negotiations toward a deal this week.

Rep. Mike Johnson (R., La.), the chairman of the conservative Republican Study Committee, a group of around 150 conservative Republicans, spoke with President Trump on Saturday about his concerns with the still-developing budget agreement. "We believe the White House and congressional leadership should be prepared to walk away from this if necessary," Mr. Johnson said in an interview. "I'm encouraged after speaking with the president."

House Speaker Nancy Pelosi (D., Calif.) and Treasury Secretary Steven Mnuchin continued to negotiate throughout the weekend, speaking on the phone on Saturday, according to an aide for Mrs. Pelosi. Mr. Mnuchin last week said both sides -- Republicans control the White House and Senate, while Democrats control the House -- have agreed on raising the debt ceiling for two years and setting spending levels but not on how to pay for the increases above limits set in a 2011 law.

Mr. Johnson and other members of the conservative group want the cost of any agreement to be fully offset by other spending cuts and include an extension of the limits set in the 2011 law. Mr. Johnson said that the agreement includes a roughly $320 billion increase over limits set in the 2011 law, though that figure may not be final.

Administration officials have indicated that they want to reach an agreement that will win the support of House Republicans. The Trump administration is seeking roughly $150 billion in spending cuts, offering a list of potential offsets that a Democratic aide close to the talks has called "nonstarters."

Looming behind negotiations over spending levels is the federal borrowing limit. Mr. Mnuchin has said the U.S. could exceed the ceiling in early September, before lawmakers return from a summer recess, pressing negotiators to reach an agreement this week. Should the government's ability to borrow become limited, it could begin to miss payments on obligations such as Social Security and veterans benefits or interest on the debt.

House conservatives want the president to follow the advice of acting White House chief of staff Mick Mulvaney and Russell Vought, the acting director of the Office of Management and Budget, both of whom have called for spending cuts. Senate Appropriations Committee Chairman Richard Shelby (R., Ala.) said he is hopeful that Mr. Trump has entrusted negotiations to Mr. Mnuchin.

"I think the secretary has been forthcoming and forthwith and is trying to avoid a catastrophe on the debt limit and also on appropriations," Mr. Shelby said. "I think he has been a voice of reason."

Rep. Chip Roy (R., Texas), who wrote a letter signed by more than 40 House Republicans earlier this year advocating to keep spending within limits set in the 2011 law, said he has spoken with Messrs. Mulvaney and Vought about the negotiations.

"The president should be listening to Mick Mulvaney and Russ Vought, and he should not be listening to Steven Mnuchin, period," Mr. Roy said. He added that his Republican colleagues in the Senate weren't sufficiently committed to cutting spending. "Senate Republicans will never not find a corner where they can go and hide," he added.

This set of spending negotiations isn't the first complicated by differences among Republicans. Last year, a stopgap measure to keep the government open passed the Senate but was rejected by Mr. Trump, who withdrew his support and called on House Republicans to pass legislation with more funding for a border wall. That prompted the longest government shutdown in U.S. history.

More recently, Mr. Trump has shown a willingness to side with Senate Republicans, who have to work with House Democrats to get spending plans through Congress. After months of wrangling over a disaster relief funding, Mr. Trump accepted a compromise to provide additional money to Puerto Rico and address a humanitarian aid package for the southern border separately.

To get Mr. Trump to agree to the disaster aid deal, Sens. Shelby and David Perdue (R., Ga.) called to encourage him to accept the agreement. Two stalwart conservatives, Reps. Jim Jordan (R., Ohio) and Mark Meadows (R., N.C.), were in the Oval Office during the call and urged him to oppose it, according to a person familiar with the conversation.

Initial proposals from the administration to maintain current spending levels for an additional year quickly lost favor with Senate Republicans, who warned about the consequences for increased military spending if no budget deal is reached.

"I think the result of all these different voices is going to mean that the outcome here remains uncertain until the legislation is passed, basically," said Shai Akabas, the economic policy director at the Bipartisan Policy Center, a think tank in Washington.

Kate Davidson contributed to this article.

Write to Andrew Duehren at andrew.duehren@wsj.com

(END) Dow Jones Newswires

July 21, 2019 19:14 ET (23:14 GMT)