Fireworks On Capitol Hill

Overview

The week of June 22 was marked by significant disruption to the appropriations process. In the Senate, appropriators were expected to begin fiscal year (FY) 2027 markups but postponed once again due to the continued absence of Defense Appropriations Subcommittee Chairman Mitch McConnell. In the House, a series of setbacks derailed consideration of both the Energy and Water Development (EWD) and National Security, Department of State, and Related Programs (NSRP) bills.

The Senate Outlook

The Senate Appropriations Committee’s slim 15–14 partisan split is designed to encourage bipartisanship. Without Senator McConnell present, and with Democrats voting in opposition while absent a bipartisan topline agreement, the committee is deadlocked at 14–14, which prevents bills from advancing to the floor. A tie loses.

While proxy voting is permitted for amendments, members must be physically present to vote on reporting bills out of committee. As a result, Senator McConnell’s presence remains critical to moving the process forward.

Compounding the delay, there is still no topline or amendment agreement between Chair Collins and Vice Chair Murray. Democrats appear unified in withholding support absence these agreements, particularly a bipartisan topline agreement. If Senator McConnell returns in the near term, markups could resume as early as mid-July. However, we anticipate disagreements over topline funding levels will persist through the Fourth of July holiday, especially considering Office of Management and Budget’s (OMB) recent supplemental request (see below). While Chair Collins seems committed to holding markups, Senate Republicans may ultimately opt to release all 12 appropriations bills and accompanying reports without markups before the August recess.

The House – What's Next?

House floor action stalled midweek following an unexpected intervention from President Trump, who announced he would withhold signing the bipartisan 21st Century ROAD to Housing Act until Congress passes his preferred version of the SAVE America Act. This disrupted House Republican leadership’s plans to adopt a rule to bring up the FY2027 Energy and Water Development (EWD) and National Security, Department of State, and Related Programs (NSRP) appropriations bills. By Thursday, House leadership had canceled votes for the remainder of the week.

Attention now theoretically shifts to the National Defense Authorization Act (NDAA) for FY2027, which the House is expected to consider this week. However, Rep. Anna Paulina Luna has threatened to continue blocking floor proceedings unless the SAVE America Act is attached to the NDAA, despite the President’s own call to avoid further obstruction. It remains unclear whether the House will be able to advance the NDAA this week, or whether leadership will again be forced to cancel votes, which would result in a longer Fourth of July recess that aligns with the Senate’s schedule.

Separately, on June 30, the House Appropriations Subcommittee on Financial Services and General Government will hold an oversight hearing with the OMB Director Russell Vought. Given OMB’s recently proposed revisions to 2 CFR Part 200 (Uniform Guidance), which would expand oversight and compliance requirements for federal funding recipients, this hearing is likely to be particularly consequential for grantees and recipients of federal assistance. Akin recently released an alert on these proposed revisions, which provides background, insights and implications into the proposed rule. Next week’s Approps Drop will include an analysis of the hearing.

One More Thing – OMB Supplemental Request

On June 24, OMB transmitted an $87.6 billion supplemental funding request, largely focused on urgent needs associated with Operation Epic Fury, with additional proposals geared toward specific member needs and priorities, likely intended to garner some level of bipartisan support. The request includes:

• $67 billion for Department of Defense military programs.
• $672 million for National Nuclear Security Administration (NNSA) Defense Nuclear Nonproliferation Programs to support efforts aimed at preventing Iran from acquiring nuclear weapons.

 Additional funding proposals include:

• $10 billion for temporary economic assistance for crop producers (crop year 2026).
• $1.1 billion for agricultural producers impacted by recent winter storms.
• $600 million for GSA building repairs and HVAC modernization.
• $500 million for National Park Service restoration projects, including the Seawall and World War II Memorial.
• $1 billion for Pension Benefit Guarantee Corporation Fund to restore pensions for former General Motors Delphi workers.
• $1 billion for reconstruction of New York’s Penn Station.
• $1.4 billion for Ebola response efforts in Central Africa.

Congressional Democrats, including Leaders Jeffries and Schumer, have signaled opposition to the request, making bipartisan support unlikely at this stage. Expect upcoming Appropriations Committee justification hearings in both chambers to provide further clarity on the administration’s priorities and the outlook for the request.