Government Funding Negotiations Continue with Shutdown Imminent

After being unable to pass separate Fiscal Year 2025 (FY25) appropriations bills, an initial bill referred to as a continuing resolution (CR) to fund the government was agreed to earlier this week by bipartisan leaders of the House and Senate. That bill would have included many provisions of interest to Goodwill including funding for disaster relief; reauthorization of the Workforce Innovation and Opportunity Act and the Older Americans Act (which includes the Senior Community Service Employment Program); extension of the Farm bill (which includes the Supplemental Nutrition Assistance Program); lifting the age for the Medicaid buy-in program; and recycling provisions which mandated a report on the textile waste stream. Unfortunately, President-Elect Trump opposed the deal in part because of the size and a desire to extend the debt limit.

An attempt to pass a narrower CR without the additional reauthorizations among other provisions failed, in large part in opposition to extending the debt limit. The debt limit suspension negotiated by Republicans and the Biden administration in 2021 will expire Jan. 2. The debt limit caps how much the government can borrow to pay for existing obligations. The Treasury Department can use financial maneuvers to extend the deadline for the government to default potentially into next summer.

At the time of this writing, there are conflicting reports if House Republicans will move forward with a vote on one bill that would extend FY25 funding into March and include disaster aid as well as a one-year farm bill extension with aid to farmers. Alternatively, the three measures (CR, disaster aid, and farm aid) may be voted on separately, with ultimately one bill going to the Senate. All bills will likely need Democratic backing, though Democrats have not indicated whether they will support the bill. It is unclear if the latest funding strategy has the support of President-Elect Trump. Text of the CR has not yet been released, but it is expected to be the text of the bill which failed last night, without the inclusion of the language temporarily extending the debt limit.

If the House manages to pass a CR, the Senate will still need time to pass any bill that ultimately moves through the House floor. The impact of a shutdown, which would begin at midnight
tonight, would be minimal over the weekend but felt beginning on Monday.

The exclusion of key provisions to reauthorize the Workforce Innovation and Opportunity Act among others will require reintroduction of those bills in the next Congress.