Status of FY 2026 Funding
Federal government funding is set to expire in 15 days. Last week, the House voted to enter conference with the Senate on three appropriations bills: Agriculture, Legislative Branch, and Military Construction-Veterans Affairs. The chairs and ranking members of the House and Senate appropriations committees have indicated that they are nearing agreement; should this legislative package be enacted before month-end, any potential government shutdown would not affect agencies and programs covered by these measures.
Irrespective of developments regarding these three appropriations bills, Republican congressional leaders have unified around a strategy to maintain government operations. They plan to advance a continuing resolution (CR) that would sustain current funding levels through November 20. If Speaker Johnson secures near-unanimous support from House Republicans for a short-term CR, he will avoid the need to negotiate concessions with House Democrats. However, Senate Majority Leader John Thune (R-SD) cannot pass spending legislation along party lines, as appropriations bills require approval by at least 60 senators to proceed and Republicans hold only 53 seats.
Given these circumstances, the Majority Leader has several options: offer Democrats incentives to gain their votes, refrain from negotiating and attempt to attract sufficient Democratic support to prevent a shutdown or permit a shutdown with hopes of attributing responsibility to the minority party. Additionally, if Republicans continue as planned, Democratic cooperation will be required on two occasions: first, to pass the CR, and later to enact full-year government funding.
Republican leadership has stated that the CR will be “clean,” without policy riders intended to secure Democratic votes. This approach proved effective in the spring when Republicans refused to negotiate while extending federal spending through fiscal year 2025, resulting in ten Democrats supporting the measure. Those members subsequently faced significant criticism from their base, making a repeat of this strategy unlikely to succeed.
Without a clear long-term strategy and successful execution, Democrats risk encountering a shutdown without gaining substantive concessions.
A similar situation occurred during President Trump’s first term, when Republicans forced the longest partial government shutdown in U.S. history over unsuccessful border wall funding negotiations. Last week, Democratic leaders declared they would not support any spending package lacking health care reforms. Although specifics have not been provided, the most probable demand is the inclusion of a rider to extend enhanced Affordable Care Act premium tax credits scheduled to expire at year-end. Extension of these credits divides the Republican conference: some members advocate for extension prior to open enrollment to prevent insurance premium increases, others support extension with income limitations, and the conservative faction strongly opposes continuation, with certain House Freedom Caucus members threatening consequences for the Speaker should the CR include such provisions.
The Speaker intends to present the CR for a House vote this week. The exact timing remains uncertain, as the bill text has not yet been released and, customarily, members are allotted 72 hours to review legislation prior to floor consideration. Depending on House action, the Senate could commence deliberation late this week, and Majority Leader Thune may adjust the upcoming recess to facilitate a vote on passage toward the end of next week.