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OUR PERSPECTIVES

How Does Congress Move Forward on FY24 Appropriations?



Although Congress was able to narrowly avoid a government shutdown by passing a continuing resolution just hours before the start of the new fiscal year, we’re not in the clear just yet. The House and Senate now have until November 17th to pass 12 appropriations bills for FY24. But doing so isn’t looking any easier than it did a week and a half ago.


Even with an additional 5 weeks to find a solution for federal funding, passing all 12 bills through regular order remains extremely unlikely. Despite bipartisan agreement on spending legislation coming out of the Senate Appropriations Committee, the Senate has yet to pass a single appropriations bill. Although the Senate appeared to be making progress on its three-bill minibus, that process ultimately stalled due to objections by a handful of senators before leadership elected to take up a clean CR.

In the House, the first order of business is electing a new Speaker. Assuming Steve Scalise is elected Speaker by the full House, attention should return to the task of passing the House’s 8 remaining funding bills. The question then is: are the demands of the Freedom Caucus – immigration reform, an end to Ukraine aid, and rolled-back policies at the DOJ and Pentagon – still in play? Or is there a clean slate now that Kevin McCarthy has been removed as Speaker?


If the demands stand, perhaps Rep. Scalise will be able to get conservative hardliners to back down from their demands. While that seems unlikely given the outsized impact they’ve had recently, former Speaker McCarthy’s ouster may have been enough to make the point. Plus, the rapidly escalating conflict in Israel/Gaza could invoke a sense of urgency within the Republican conference to unite and move on.


If all 12 bills somehow pass both chambers, the House and Senate still have to conference to negotiate the final funding levels before sending anything to the President’s desk. They remain extremely far apart on topline spending levels. It’s difficult to imagine House Republicans agreeing to move forward on FY24 funding without at least some concessions from the Senate on spending cuts. Given that Defense spending was the primary area of agreement among Republicans, cuts to this account appear even less likely now.


So, what’s going to happen? In the immediate aftermath of the September 30th CR, the early reaction by many was that a government shutdown is inevitable and was really only pushed back by a few weeks. But the new state of global affairs may have changed the appropriations landscape. While Congress still may not be able to pass all appropriations bills through regular order by mid-November, areas of consensus may shake loose in time to fund the government for FY24 with a full omnibus. Either way, the pressure to act quickly is rebuilding with even more far-reaching consequences.


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