Join us on Monday, December 4 for an exclusive event featuring a conversation with House Rules Chairman and Appropriations Vice Chairman Tom Cole(R-OK) moderated by Leslie Belcher, Steptoe partner and former Chief of Staff to Chairman Cole. We will discuss the changing environment of appropriations and fiscal policy, the current state of play with federal funding, and the path forward. Please RSVP here.
Steptoe has been consistently tracking the fast-moving developments in the federal appropriations process on behalf of our clients. Below are the top developments you need to know.
The good, the bad, and the ugly. Let's start with the good. Both the House and Senate passed a Continuing Resolution (CR) on Wednesday, which the President signed before the Friday deadline. The legislation will continue government funding for Agriculture; Military Construction and Veterans' Affairs; Energy and Water; and Transportation, Housing and Urban Development until January 19. The remaining appropriations subcommittee bills will be extended until February 2. This buys valuable time for both chambers to continue working through their bills.
Unfortunately, the "bad" is that other than the FY23 CR, neither the House nor the Senate have been able to move appropriations legislation across their floors in more than two weeks. With only 19 legislative days until January 19 (under the current House calendar), we are hopeful House and Senate negotiators can begin working on their differences. More on this below.
Even "uglier" is the House has either pulled off the floor or failed to pass even procedural votes (like rules). This lack of party unity is unusual and makes us uneasy about Speaker Johnson's chances to negotiate final measures supported by a majority of his Conference. Just this week, House Leadership moved to put the CR on the suspension calendar (bypassing the Rules process) because the votes weren't present for the Rule. The House also pulled the Labor, Health and Human Services, and Education Appropriations bill due to lack of votes. And, the Rule for the Commerce, State, and Justice Departments failed on the floor. Normally, this kind of public failure within either party is unheard of. It doesn't bode well for the new Speaker or for the prospect of passing important legislation.
What's next? The House and Senate are now recessed until November 28. Time (and turkey) can heal many wounds and sore feelings. However, when the Chambers return, they'll have a full plate. Consider this: the House has passed 7 of 12 appropriations bills, but the others appear unlikely to pass. The Senate has passed only 3 of the 12 appropriations bills.
Our hope is that when Congress returns, they will begin bicameral negotiations on the individual spending bills and the topline spending number. We know staff have had some informal conversations already. We remain optimistic these negotiations will occur. The looming question is will Congress agree on and pass all or only some of the appropriations bills by their deadlines or will another CR be needed for unfinished bills. Many think if that happens, the next CR could last to the end of the fiscal year, or September 30, 2024.
- November 15 - Hardliners sunk any chances of passage for two additional funding bills this week — marking a major setback for Speaker Mike Johnson less than 24 hours after working with Democrats to pass a bill that would thwart a shutdown deadline. Politico Pro
Related: Lawmakers adopted 26 more amendments to House legislation to fund the departments of Labor, Health and Human Services and Education Wednesday before abruptly leaving town for their Thanksgiving break. CQ News
Related: The House passed a short-term funding bill on Tuesday, moving to avert a government shutdown despite fierce opposition from conservatives. Politico Pro
- November 14 - With Congress poised to punt fiscal 2024 appropriations bills into the next calendar year, U.S. national security programs are bracing for the possibility they may net $82 billion less in the next two fiscal years than the amounts set by June's bipartisan debt limit law. CQ News
- November 14 - Republican colleagues of Speaker Mike Johnson anticipate he'll be an ally of efforts to slash the budgets of federal law enforcement agencies, a rallying point for the right flank that could set up a clash in funding showdowns against the White House and Senate Democrats. Roll Call
- November 13 - The House stopgap funding bill includes a $177.4 million rescission to help continue 21 orphan programs that otherwise would be left out of a one-year farm bill extension. CQ News
- November 13 - The House Republican Steering Committee selected Rep. Chuck Edwards of North Carolina to fill the party's open seat on the Appropriations Committee, a source familiar with the decision said. CQ News
- November 16 - The U.S. Senate took the risk of an impending partial government shutdown off the table on Wednesday as it passed a stopgap spending bill and sent it to President Joe Biden to sign into law before a weekend deadline. Reuters
The White House released the following Statements of Administrative Policy this week:
- Commerce, Justice, Science, and Related Agencies Appropriations Act
- Departments of Labor, Health and Human Services, and Education, and Related Agencies Appropriations Act
- Congress will be out of session next week.
- The Steptoe Appropriations Newsletter will not publish next week. We'll see you December 1. Have a wonderful Thanksgiving.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.