CR in the Wings: Negotiations between appropriators on the looming continuing resolution (CR) are ongoing, but congressional leaders have said the process needs to wrap up today to give staff enough time to post the text over the weekend and pass the bill before the December 20 deadline. The new CR is expected to go through March 14. Negotiations are currently happening around the clock, with leadership having to weigh in on items like the one-year farm bill extension and a possible health care extenders package, among others. News outlets reported last week that disaster funding could be cut significantly compared to the White House's request. However, it is now looking like the final package, which is expected to be attached to the CR, could be much closer to $100 billion.
Regardless of what happens with the CR, House Appropriations Chair Tom Cole (R-OK) and incoming-Senate Appropriations Chair Susan Collins (R-ME) are planning to finish up the FY25 funding bills before the next deadline.
Defense Spending Holdbacks: While appropriators race to finish FY25, leadership is already looking towards FY26 defense spending. As part of the first reconciliation bill next year, incoming-Senate Majority Leader John Thune (R-SD) reportedly plans to include additional border security and defense spending. However, some Republicans have pushed back on this, arguing that more money should not be given to the Defense Department until the Department of Government Efficiency (DOGE) is able to successfully identify areas of waste, fraud, and abuse. This is a departure from the past, when opposing increased defense spending was seen as a non-starter for Republicans in Washington. This issue could divide Republicans next year, pitting defense hawks against budget hawks. And, more importantly, it highlights the difficulty for House and Senate Republicans to move quickly on any reconciliation bill.
On a related note, the House passed the National Defense Authorization Act this week, with 81 Democrats joining 200 Republicans to vote "aye" on the measure. The final bill stuck to the spending cap negotiated under the debt limit deal last year and authorizes a total of $895 billion. The Senate is expected to take up the measure next week.
CBO Baseline Changes: This week, the House unanimously passed the Increasing Baseline Updates Act (H.R. 9716), which would require the Congressional Budget Office (CBO) to submit at least two updates to its annual baseline, including the economic data used in its calculation. The bill also requires the President to submit technical budget data to Congress by February 1st each year. This change would give Congress better insight into the federal government's projected spending for the year and give appropriators more time to examine the President's budget request.
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