UPDATE 1-U.S. Senate passes funding bill to avoid Oct. 1 govt shutdown

* U.S. government funding secured through March 27

* Stopgap measure moves to Obama for signature

* U.S. Senate measure insists Iran be denied nuclear weapon

WASHINGTON, Sept 22 (Reuters) - A deeply divided and

unproductive Congress wrapped up its final business before

November's elections early on Saturday as the U.S. Senate passed

a stopgap measure to fund federal programs and avoid an Oct. 1

government shutdown.

The 62-30 vote on the funding bill, which now moves to

President Barack Obama's desk to be signed into law, was delayed

by days of partisan bickering over votes on unrelated measures

aimed at boosting both Democrats' and Republicans' political

fortunes.

For the new fiscal year which begins on Oct. 1, the $524

billion measure slightly raises discretionary spending - which

funds government agencies and everything from defense to

national parks - from current levels.

It was needed because Congress' normal process of

appropriating money for government operations broke down amid

disagreements between Democrat and Republicans over spending

levels and funding was due to run out after Sept. 30.

"It is an inefficient way to fund the federal government but

it is better than shutting it down next week," said Democratic

Senator Daniel Inouye, the Democratic chairman of the Senate

Appropriations Committee.

Congress' bitter fights over spending cuts and raising the

debt limit last year led to threats of several shutdowns as

temporary funding measures expired. The last time government

funding actually ran out was late 1995 and early 1996, forcing

then-president Bill Clinton to shut down non-essential services

and furlough non-essential government workers for 28 days.

Saturday's vote allows lawmakers to return to their home

states for a final re-election campaign push, but they leave a

huge to-do list for their return after the Nov. 6 election.

By keeping the government funded through March 27, Congress

has somewhat lightened its post-election workload, which centers

on dealing with expiring tax cuts, automatic spending cuts, a

debt limit increase and other fiscal deadlines.

With relative peace over the budget, lawmakers will be able

to takle more difficult difficult questions - how to avoid $109

billion in automatic budget cuts that start on Jan. 2, and

whether to extend some or all of the tax cuts enacted under

former President George W Bush, which expire Dec. 31.

Moody's Investors Service has threatened to downgrade the

U.S. credit rating if Congress' deliberations do not reduce

budget deficits in a meaningful way. Economists warn that the

United States will slide back into recession if Congress fails

to take action to mute the massive impact of tax hikes and

spending cuts.

IRAN RESOLUTION, HUNTING BILL

In other wrap-up business, the Senate also passed by a 90-1

vote a non-binding resolution insisting that the United States

prevent Iran from obtaining nuclear weapons and ruling out any

strategy aimed at dealing with a nuclear-armed Iran.

The only senator to vote against the resolution was

Republican Rand Paul, a Tea Party and libertarian favorite, who

argued that it was a de-facto declaration of war.

Paul had sponsored another measure that would suspend

foreign aid to the governments of Pakistan, Egypt and Libya in

response to recent attacks on U.S. interests in these countries,

but this was soundly defeated by a vote of 81-10.

Senate Democrats also prevailed in a procedural vote that

keeps alive legislation aimed at boosting the re-election

chances of their colleague Senator Jon Tester, who is in a tight

re-election race that threatens the narrow Democratic majority

in the Senate.

Tester's measure would increase hunting and fishing access

on public lands - a move popular in his home state - and the

vote allows him to claim on the campaign trail that his plan is

superior to a similar measure offered by his opponent,

Republican Representative Denny Rehberg.