WASHINGTON — On the eve of a crucial Senate vote on regulatory relief, the split in the Democratic caucus over rolling back the Dodd-Frank Act has never been starker.

Lawmakers on Tuesday voted 67 to 32 to begin debating the targeted relief bill that Senate Banking Committee Chairman Mike Crapo, R-Idaho, negotiated with moderate Democrats on the panel. The Senate could vote on the legislation before the end of the week.

While the bill's bipartisan support appears to be sufficient for Senate passage, that did not stop Democrats from trading barbs with each other. The moderates supporting the bill continue to stress that the bill is balanced and preserves the Dodd-Frank regulatory framework, while more progressive Democrats argue that it is an industry giveaway.

Sen. Elizabeth Warren (left) and Sen. Heidi Heitkamp (right)
Democratic Sen. Elizabeth Warren, left, said the "bill is all about helping the big banks.” But Sen. Heidi Heitkamp said she won’t let the bill be “papered by misstatements.”

“This bill is all about helping the big banks,” Sen. Elizabeth Warren, D-Mass., said at a press conference Tuesday morning. “All I know is how the American people feel about bank deregulation, and telling a bank that it can be deregulated, and everyone who votes for this bill has to acknowledge this."

But at a competing press conference, Sen. Heidi Heitkamp of North Dakota, one of the Democrats who helped steer the bill out of the Senate Banking Committee, said she won’t let the bill be “papered by misstatements.”

“This is our moment to get this done,” said Heitkamp, who was joined by other Democrats supporting the legislation.

Their statements came on the heels of a Congressional Budget Office report Monday that project a small uptick in the threat of a large bank failing as a result of the legislation. That "probability is small under current law and would be slightly greater under the legislation,” the report said.

The report prompted a sharp reaction from Sen. Sherrod Brown, D-Ohio, the Banking Committee's ranking member and an opponent of the bill, who said in a statement that the CBO "confirmed what we know — this bank giveaway bill will cost taxpayers.”

“Hardworking Americans shouldn’t have to pay for favors to Wall Street, foreign megabanks and their lobbyists,” Brown said.

But supporters of the legislation argue that those characterizations miss the boat. The coalition of Republicans and Democrats backing the bill had voted down amendments during the December markup in the Banking Committee, which would have expanded the legislation, to preserve its targeted approach.

The bill would among other things raise the Dodd-Frank "systemically important financial institution" threshold from $50 billion to $250 billion, while also make a number of other changes to help community banks by providing them exemptions from regulatory requirements related to mortgage lending and reporting. The bill would also provide an “off-ramp” from Basel capital and liquidity requirements for smaller banks with a high leverage ratio.

“This bill focuses on the smaller financial institutions in America,” Crapo told reporters Tuesday. “There is very, very little in this bill that reaches to the mega banks or the bigger banks.”

Yet Brown, during a Senate floor speech, noted that the legislation would ease certain requirements even for banks retaining the SIFI label under the higher asset threshold.

“This bill weakens stress tests for all large banks, even Wall Street megabanks that are designated as ‘global systemically important banks’ like JPMorgan Chase, Bank of America, Wells Fargo, and Citigroup,” Brown said.

The bill will likely include a "managers' amendment," but what the Senate considers this week will still likely look similar to the bill the panel committee approved 16 to 7 in December.

Sen. Mark Warner, D-Va., who co-sponsored the bill, told reporters during the briefing with Heitkamp Tuesday that the managers’ amendment won’t “radically shift people's opinion” in one direction or the other, and that the co-sponsors will continue to support the legislation.

However, Crapo left open the possibility of the Senate at least considering amendments for a final vote on the bill. "We need to get a handle on how many amendments we need to deal with and that hasn’t been resolved yet,” he said.

Heitkamp said every senator who signed onto the bill, including 12 Democrats and Sen. Angus King, I-Maine, who caucuses with the Democrats, “has veto authority” over any changes.

“Nobody got everything they wanted,” Warner said.

Sen. Jon Tester, D-Mont., another member of the coalition, also shot down the notion that the House will make substantial changes to the legislation. “If it does," he said of the House, the bill is "done."

The moderate Democrats said the White House is supporting the legislation and that they hope the administration asks the House not to make significant changes to the bill.

Sen. Joe Donnelly of Indiana, who rounded out the four Democrats on the Banking Committee who helped negotiate the bill, said a number of House provisions have been included in the Senate deal so it gives the lower chamber — which failed to enact a separate bill to go much further to overhaul Dodd-Frank last June — ownership of the legislation.

“We have tried to make sure that the House’s views have been brought into it,” Donnelly said.

But Warner acknowledged that his party is split. “We understand there is going to be division in the Democratic caucus,” Warner said.

In her press conference, Warren warned of a particular change of wording in the bill that she said would allow the biggest Wall Street banks to fight tougher regulation.

“The bill changes just one word. It says the Fed ‘shall’ tailor the rules for the biggest banks instead of ‘may’ tailor the rules. That one word change will allow the big banks to sue the Fed if they don’t weaken the rules the way the banks want and that pressure will lead to a systematic weakening of the rules to all the big banks,” Warren said.

“This may be the single most dangerous provision in the bill and it applies only to the biggest Wall Street banks,” she added.

But the moderate Democrats supporting the bill said it does nothing to help the biggest banks.

Warner called it a “fix-it bill” that has taken years of negotiations.