Congress advances $1.66 trillion funding package to avert shutdown

Congress moves to advance a roughly $1.66 trillion government funding package intended to avert a looming partial federal shutdown, with leaders racing to finalize measures before a Jan. 30 deadline to keep affected agencies open. The framework sets an overall discretionary topline near $1.66 trillion and pairs record military spending with essentially flat nondefense discretionary allocations, while leaving several politically fraught items unresolved.

The package increases Pentagon funding to $886.3 billion and holds nondefense discretionary spending at $772.7 billion. Officials said that $69 billion of added nondefense money reflects a handshake agreement between former House Speaker Kevin McCarthy and the White House. To offset the increases, leaders plan to accelerate $10 billion in cuts to Internal Revenue Service enforcement and to claw back $6 billion in unspent COVID and other emergency funds. The agreement does not include an additional $14 billion that Senate appropriators had sought for domestic and military programs.

Senate and House leaders framed the package as broadly in line with last year’s Biden-McCarthy deal, a posture aimed at securing bipartisan support while managing internal party opposition. Senate Majority Leader Chuck Schumer (D-N.Y.) and House Democratic Leader Hakeem Jeffries (D-N.Y.) said that by securing $772.7 billion for nondefense discretionary funding, Congress could protect “key domestic priorities like veterans benefits, health care and nutrition assistance from the draconian cuts sought by right‑wing extremists.” In briefing colleagues, Mr. Schumer called the framework a “good deal for Democrats and the country,” and he and Mr. Jeffries urged a bipartisan approach to avoid “a costly and disruptive shutdown.”

The House took a procedural step forward by advancing H.R. 7006, a minibus appropriations measure combining Financial Services and General Government with State Department and related national security funding, in a 341-79 vote, the House Appropriations Committee said. Committee chairman Rep. Tom Cole (R-OK) described the passage as “another step forward – another promise kept,” calling the bills bipartisan and bicameral full-year funding measures that “turn priorities into results,” support economic opportunity and national security, and shift IRS resources “toward customer service.”

Despite the progress, key disputes remain. Funding for the Department of Homeland Security is a flashpoint, with progressives pressing for ICE reforms and saying they could withhold support unless homeland security funding is paired with changes to immigration enforcement. Senate leaders are expected to move a previously negotiated three-bill package before a short recess, but officials said more work is needed to reconcile House and Senate differences across multiple minibus and omnibus measures.

The procedural path ahead requires leaders to reconcile competing bills, secure House and Senate votes on final text, and resolve outstanding policy riders and supplemental funding requests. If Congress fails to complete that work, agencies covered by the unresolved appropriations risk a partial lapse in funding after Jan. 30, with potential disruptions to veterans services, public health programs and diplomatic operations. Lawmakers from both parties emphasized the need for compromise, but intra-party leverage and unresolved policy fights will determine whether the package becomes law or whether leaders must pivot to short-term continuing resolutions.