Update 735 — FY24 Funding Smoke Signals: Shutdown Threat on Hold Two More Months

A moment of comity prevailed late yesterday, on a day including physical threats in both chambers, when the House adopted Speaker Johnson’s early holiday gift of a clean, two-step laddered continuing resolution, with the Senate and President Biden expected to sign on and avert a government shutdown until January 19. Democrats provided a majority of the House votes for passage, a pattern not likely to recur when FY24 budget hostilities resume early next year.

The agreement resolves nothing and makes little policy; but merely postpones the inevitably difficult budget debate and decision until January, the fourth month of the current fiscal year. But smoke signals amid the progress to avert a shutdown are already apparent in the appropriations bills moving through the GOP House, which feature drastic spending cuts and culture war policy riders. For details on Johnson’s gambit, how it came to pass, and what to expect over the next two months, see below. 



House Passes CR; Senate, President OKs to Follow

Last night, the House passed a “laddered” continuing resolution (CR) in a 336-95 vote, marking the first step in avoiding a government shutdown on November 17. The bill was passed under suspension of the rules, meaning that it required a two-thirds majority vote, expediting passage by allowing the measure to circumvent the traditional rules process and avoid time-consuming amendments. 93 Republicans and two Democrats opposed the stopgap measure in the vote on final passage, a momentary bright spot of bipartisanship amid a long, contentious, and still-incomplete FY2024 budget-making process. 

The bill extends the expiration of four appropriations bills through January 19, and the remaining eight through February 2. Ranking member on the House Appropriations Committee, Representative Rosa DeLauro (D-CT), has been joined by fellow Democrats and the White House in voicing concerns about the negative implications the laddered approach could have on the appropriations process, essentially setting up two shutdown deadlines instead of one. But the near-unanimous support for this measure by House Democrats was made possible by a CR absent of extreme provisions and spending cuts that have been — and will continue to be — demanded by a large block of conservative House Republicans. 

Speaker Mike Johnson (R-LA) has stated that this will be the last time he supports the use of a CR to delay the FY2024 appropriations deadlines, meaning that both the January 19 and February 2 deadlines would result in shutdowns if the chambers fail to find consensus. But the timetable would also mean that the across-the-board spending cuts included in the Fiscal Responsibility Act (FRA) that passed earlier this year are unlikely to occur, as they would apply only if an FY2024 spending deal is not completed before April 30. 

The “clean” CR will now head to the Senate, where Majority Leader Chuck Schumer (D-NY) has vowed to work with Minority Leader Mitch McConnell (R-KY) to move it through quickly. As this is the last piece of legislation that the Senate will consider before breaking for Thanksgiving recess, we can expect action to be taken today or tomorrow.  Although President Biden has not explicitly stated that he plans to sign the CR into law, he is unlikely to risk a government shutdown by vetoing the measure. 

“Clean” and “Laddered” CR Proposal

The Further Continuing Appropriations and Other Extensions Act (H.R 6363) would fund four appropriations bills through January 19, bill status and topline funding levels are included for reference:

  • Military Construction and VA
    • Passed in House and Senate
    • House: $155.7 bn, Senate: $154.4 bn, Difference: $1.3 bn
  • Agriculture
    • Passed in Senate
    • House: $17.8 bn, Senate: $26 bn, Difference: $8.2 bn
  • Transportation and HUD (THUD)
    • Passed in Senate
    • House: $65.2 bn, Senate: $88.1 bn, Difference: $22.9 bn
  • Energy and Water
    • Passed in House
    • House: $52.4 bn, Senate: $56.7 bn, Difference: $4.4 bn

The bill also would fund the eight remaining FY24 appropriations bills through February 2, bill status and topline funding levels are included for reference:

  • Defense
    • Passed in House
    • House: $826.4 bn, Senate: $831.1 bn, Difference: $4.8 bn
  • Homeland Security
    • Passed in House
    • House: $83.1 bn, Senate: $81.6 bn, Difference: $1.4 bn
  • Interior and the Environment
    • Passed in House
    • House: $28.1 bn, Senate: $42.7 bn, Difference: $14.6 bn
  • Legislative Branch
    • Passed in House
    • House: $5.3 bn, Senate: $4.7 bn, Difference: $0.6 bn
  • State and Foreign Operations
    • Passed in House
    • House: $41.4 bn, Senate: $58.4 bn, Difference: $17 bn
  • Commerce, Justice, and Science (CJS)
    • House: $58.4 bn, Senate: $69.5 bn, Difference: $11.1 bn
  • Financial Services and General Government (FSGG)
    • House: $11.5 bn, Senate: $17 bn, Difference: $5.5 bn
  • Labor, HHS, and Education
    • House: $147 bn, Senate: $202.2 bn, Difference: $55.2 bn

Speaker Johnson’s laddered CR proposal includes an extension of the 2018 Farm Bill through September 30 of next year. This will allow programs like SNAP that are funded through the Farm Bill to continue to provide services while a long-term agreement is negotiated. 

Speaker Johnson’s CR proposal succeeded because it omitted “poison-pill” provisions or extreme cuts that have been insisted on by House Republicans in their appropriations bills. Although this auto-pilot funding fueled opposition from 93 Republicans in last night’s vote, it was key to ensuring the bipartisan support necessary for the stopgap measure to pass through the House, given the two-thirds majority that is required under suspension of the rules. The “clean” nature of the CR also means it has every chance of passing the Senate and being signed by President Biden on time to avert a shutdown. 

Notably, Speaker Johnson’s CR is absent of:

  • international supplemental funding for Israel, Ukraine, and Indo-China.
  • funding for border security.
  • domestic supplemental funding for the Special Supplemental Nutrition Programs for Women, Infants, and Children (WIC). 
  • provisions for a fiscal commission.

House, Senate Still Far Apart on Appropriations Bills

Congress is likely to move forward with Johnson’s CR proposal as a majority of Democrats and Republicans have been adamant about avoiding a full government shutdown. Although McCarthy lost the speakership for working with Democrats just under 45 days ago, The House GOP gave Johnson a “mulligan” on this proposal as a part of the grace period afforded to him in his new position as a recently installed Speaker. He will now need to refocus on reconciling Republican demands for spending cuts and “poison-pill” provisions in the final FY2024 spending bills with the need for passage of a final FY2024 budget next year. 

Balancing these demands will be no easy task. Appropriations bills for THUD, Agriculture, FSGG, and Labor-HHS were unable to be moved through the House due to opposition to some of their more extreme amendments from within the House Republican Caucus. Even if these bills meet the remote possibility of being passed through the Senate, the White House will likely veto many of the House appropriations bills in their current form. In a press conference yesterday, Speaker Johnson noted that legislators will have a break for Thanksgiving that will allow them to regroup and refocus on the tough appropriations process ahead. However, this does not change the fact that both chambers of Congress are as far from agreement as ever on 302(a) (topline spending caps) and 302(b) (spending caps for each appropriations bill) allocations. The vast differences between the funding levels and terms in the House and Senate proposals, as detailed above, signal that, even with the time granted to conclude the process, we should expect deep partisan contention and further GOP brinksmanship in advance of the January and February deadlines.