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FY2024 Appropriations
We are tracking the status of FY2024 appropriations, where things stand, and what it all means for bond lawyers.
Last Updated March 25, 2024
Appropriations Work Concluded
Congress passed the final set of appropriations on March 23, 2024. Appropriations for the full federal government are authorized through FY2024, which concludes on September 30, 2024. NABL will update members separately on any relevant supplemental appropriations and FY2025 appropriations as details become available.
Congress and the Administration had until September 30, 2023, to provide appropriations for the federal government’s fiscal year 2024. The Fiscal Responsibility Act (FRA), also known as the Bipartisan Debt Deal enacted in June 2023, set topline budget numbers of $1.59 T for FY2024 and $1.606 T for FY2025. The FRA also contained an automatic restriction to discretionary spending in the event of a CR lasting beyond January 1, 2024.
What’s Next
Congress passed several continuing resolutions (CRs) to avert full and partial government shutdowns throughout the first six months of FY2024. On March 24, Congress passed the last set of full appropriations to authorize spending through the remainder of the fiscal year ending on September 30, 2024.
New to Appropriations
Federal Appropriations Process
A quick primer to help bond lawyers better understand the federal appropriations process and its connection to municipal bond offerings.
Final Spending Bills
Consolidated Appropriations Act, 2024: A “minibus” that provides full appropriations through the remainder of FY2024 for six appropriations areas:
- Military Construction, Veterans Affairs
- Agriculture, Rural Development, Food and Drug Administration
- Commerce, Justice, and Science
- Energy and Water Development
- Interior and Environment
- Transportation, Housing and Urban Development (T-HUD)
Further Consolidated Appropriations Act of 2024: A second minibus that provides full appropriations through the remainder of FY2024 for:
- Defense
- Financial Services and General Government (IRS + SEC)
- Homeland Security
- Labor, Health & Human Services, and Education
- Legislative Branch
- State Department and Foreign Operations
Updates
You can track the status of both chambers’ work to complete all 12 appropriations bills here. NABL will continue to keep members informed as information becomes available. [New Updates Highlighted]
- 3/23/24: The Senate passed the second appropriations package (“minibus”) early in the morning. President Biden signs the package into law.
- 3/22/24: The House passes the second appropriations package (“minibus”).
- 3/21/24: Congressional leadership releases legislative text for the second appropriations package.
- 3/19/24: House and Senate leadership reach a deal in concept to pass a package for the six remaining appropriations areas with legislative text expected in the coming days. Timing constraints add mounting pressure for the text release and could necessitate another CR to avoid a partial government shutdown.
- 3/13/24: The Congressional Budget Office (CBO) sends a letter to the House Budget Committee providing updated accounts of how sequestration rules enacted by the FRA would apply to FY2024 spending.
- 3/9/24: President Biden signs the Consolidated Appropriations Act (CAA) into law, which provides full appropriations for six appropriations areas.
- 3/6/24: House passes a $460 billion “minibus” spending package that includes funding for the remainder of FY2024 to six of the 12 appropriations areas. Legislative Text Available Here. The measure heads to the Senate.
- 2/28/24: Both the House and Senate pass a fourth continuing resolution. Details of the provision follow below.
Fourth Stopgap Package
Congressional leadership announced a fourth CR that would punt government funding further into March to buy appropriators more time to complete their full FY2024 appropriations work. The new spending deal funds six of the appropriations areas through March 8, and the remaining six through March 22. Members of Congress feel generally confident in their ability to complete FY2024 appropriations work by those new deadlines. Lead appropriators also released final spending bills for the six areas due March 8: Agriculture-FDA; Energy and Water; Military Construction and Veterans Affairs; Transportation & Housing and Urban Development (T-HUD); Interior and Environment; and Commerce-Justice-Science.
- 2/28/24: Congressional leaders unveils a fourth stopgap spending plan to extend government funding across two spending deadlines: March 8 and March 22. Appropriators aim to pass six of the 12 FY2024 appropriations bills early next week.
- 2/26/24: President Biden hosts the “Big 4” congressional leaders (Senate Majority Leader Mitch McConnell, Senate Minority Leader Chuck Schumer, Speaker of the House Mike Johnson, and House Minority Leader Hakeem Jeffries). Speaker Johnson reiterates his belief that a shutdown on Friday March 1 could be avoided.
- 2/13/24: Senate passes a standalone supplemental spending package to provide foreign aid to Ukraine, Israel, and Taiwan in a 70 to 29 vote. The measure will likely meet resistance in the House. Passage of a foreign aid package remains a prerequisite to full FY2024 appropriations for Democrats and many Republicans.
- 2/8/24: Senate leadership on both sides of the aisle begin to support a more limited package that would include aid for Ukraine, Israel, and Taiwan, but not additional border security proposals. The move would effectively split the two core issues of the original supplemental spending deal.
- 2/7/24: Senate Republicans block a proposed foreign aid and border security supplemental spending package. Movement on these policy areas, in tandem, is largely seen as a necessary prerequisite for movement on a bipartisan FY2024 spending package. Senators from both parties negotiated the details of the border security package, but Republican Senators began to oppose the proposal when it became clear that it would not pass in the House.
- 2/7/24: The House fails to pass a standalone package to provide aid to Israel.
- 1/18/24: Congress passes a third CR, which extends funding set to expire on January 19 to March 1 and funding set to expire on February 2 to March 8. View Legislative Text >
- 1/14/24: Facing too short of a window to work out the specifics of a bipartisan funding agreement announced on January 7, congressional leadership released the text of a third CR proposal that would again fund the government on a short-term basis across two tranches. The four appropriations areas set to expire on January 19, 2024 would be extended through March 1, 2024. The remaining 8 areas would extend through March 8, 2024.
- 1/7/24: Speaker Johnson (R-LA) announces an agreement with democratic leadership to topline spending numbers for full FY2024 appropriations. While much work remains prior to the first spending deadline on January 19, 2024, the agreement represents a major step toward averting a partial or full government shutdown. Here’s what we know so far:
Potential Bipartisan Spending Deal
A bipartisan agreement announced on January 7, 2024, provides a framework and topline spending numbers for the remainder of the federal government’s FY2024. Here’s what we know:
Topline
Amount | Notes | |
---|---|---|
Total Discretionary Spending | $1.659 trillion | Roughly equal to FY2023 |
Non-Defense Programs | $772.7 billion | < 1 percent cut compared to FY2023 |
Defense Programs | $886.3 billion | ~3 percent increase compared to FY2023 |
IRS Funding
The deal does not include additional cuts to Internal Revenue Service (IRS) funding beyond those outlines in the FRA. It proposes, however, an acceleration of a $10 billion reduction scheduled for FY2025. This reduction is coupled with an already scheduled $10 billion reduction for FY2024, summing to a total of $20 billion in cuts to IRS funding for the fiscal year.
Unknowns Remain
Congressional leadership negotiated this package, and it is unclear to what extent both caucuses will support it. The compromise proposes cuts to federal spending that fall well below those sought by conservative Republicans. It also does not address the supplemental spending requests for military aid to Ukraine, Israel, and Taiwan. Republicans will also likely demand some sort of legislative action or agreement on border policy prior to advancing a spending package.
- 12/22/23: The Office of Management and Budget (OMB) sent a memo to the heads of all federal departments and agencies regarding the application of spending limits outlined in section 102 of the FRA.
Understanding FRA Restrictions
The Fiscal Responsibility Act (FRA) mandates a one-percent cut to federal discretionary spending authorized under a CR lasting beyond January 1, 2024. The aforementioned OMB memo indicates that neither OMB or agencies will enact cost cutting measures on January 1, citing that such measures are only mandated “after full year appropriations are enacted, or April 30 [2024], whichever comes first.”
The memo goes on to indicate that if the federal government operates on a CR beyond April 30, 2024, OMB “is required to issue a Final Sequestration Report that compares the annualized appropriation levels provided by all discretionary appropriations bills under current law as of April 30 against the section 102 interim spending limits”; and that OMB will issue a Final Sequestration Report within “15 working days after all full-year discretionary appropriations bills are enacted…”
- 11/15/23: The Senate passes the new stopgap measure in an 87-11 vote, averting the risk of an imminent government shutdown until the new year.
- 11/14/23: The House of Representatives passed Speaker Johnson’s (R-LA) two-tranche CR proposal in a 336-95 vote (127 Republicans joined by 209 Democrats). The measure now heads to the Senate where Senate Majority Leader Schumer (D-NY) has indicated his support for the measure.
- 11/13/23: House Republican leadership announced a plan to fund part of the federal government through January 19, 2024, and the remainder of the government through February 2, 2024. While the proposal was met with resistance by a sizable portion of House Republicans, Speaker Johnson (R-LA) indicated a willingness to advance the package with Democrat support. See details below:
“Laddered” Stopgap Measure
Throughout the week of November 13, 2023, Congress debated and ultimately passed a laddered CR to temporarily fund the government in two tranches. The proposal averted the risk of a federal government shutdown upon the expiration of the previous stop gap measure on November 17. The two tranches will extend authorization for four of the appropriations bills through January 19, 2024, and the remaining eight bills through February 2, 2024, as detailed below:
Thru Jan. 19, 2024
- Agriculture and FDA
- Energy and Water Development
- Military Construction, Veterans Affairs
- Transportation, Housing and Urban Development (T-HUD)
Thru Feb. 2, 2024
- Commerce, Justice, and Science
- Defense
- Financial Services and General Government
- Homeland Security
- Interior and Environment
- Labor, Health and Human Service
- Legislative Branch
- State and Foreign Operations
- 11/10/23: The House of Representatives has passed 7 of its 12 appropriations bills but had to punt on several others due to intraparty disputes. Speaker Johnson is hopeful that his chamber will pass its 12 appropriations bills to strengthen his caucus’ position prior to negotiations with the Senate and Administration.
- 11/2/23: Speaker Johnson (R-LA) acknowledged that an additional CR may be necessary to avoid a government shutdown on November 17 and offered a laddered approach to sustaining the government. While the announcement lacked specific details, the Speaker implied that a new CR could extend funding for the 12 areas of appropriations with staggered deadlines allowing Congress more time to address FY2024 spending one area at a time.
- 11/1/23: The Senate passed three of its 12 FY2024 appropriations bills. The move combined three of the less controversial appropriations areas— Agriculture-FDA; Military Construction and Veterans Affairs; and Transportation-Housing and Urban Development (T-HUD)— into a consolidated package known as a minibus.
- 10/25/23: The House voted along party lines to elect Rep. Mike Johnson (R-LA) to serve as the new Speaker. The move ends three weeks of a paralyzed Congress and clears the path for normal legislative work to resume.
- 10/3/23: The House voted to oust Rep. Kevin McCarthy (R-CA) from his position as Speaker, rending the chamber unable to conduct normal legislative work until a new Speaker is selected. Rep. Patrick McHenry (R-NC) serves as a Speaker Pro Tempore in the interim with limited powers.
- 9/30/23: The House of Representatives and Senate passed a “clean” CR in a strong bipartisan 335 to 91 vote. See details below:
45-Day-Stopgap Measure
On September 30, 2023, Congress passed a 45-Day-Stopgap measure that maintains federal government spending largely at FY2023 levels through November 17, 2023, and:
- Extends the National Flood Insurance Program (NFIP) through November 17, 2023.
- Extends authorization for the Federal Aviation Administration, various air programs, and air travel-related federal taxes through December 31, 2023.
- Congress last fully authorized the Federal Aviation Administration (FAA) via the FAA Reauthorization Act of 2018 (H.R. 302), which expired on September 30, 2023.
- Provides supplemental aid for disaster recovery.
- 9/29/23: The House proposal, listed below, fails to pass in a 198-232 floor vote.
- 9/29/23: The House of Representatives teed up debate on a proposal that would extend appropriations for the federal government through October 31 with across the board cuts up to 30 percent below FY2023 levels. The proposal exempts most defense, veterans, and homeland security programs from the cuts. It also includes large portions of a Republican proposed bill to enhance border infrastructure, patrol, and security. It remains unclear whether House Republicans have the votes to pass the package, but even if it does pass, the Senate will almost certainly reject it.
- 9/26/23: A bipartisan group of Senators release a proposal to maintain funding for the federal government through November 17. The proposal would avert the imminent risk of a shutdown this weekend, while affording Congress more time to settle hot button issues such as aid to Ukraine. It would also temporarily extend reauthorization for key Federal Aviation Administration (FAA) programs that are also set to expire at the end of September. Plan announcement and details can be found here.
- 9/26/23: House Republicans vote along party lines to advance discussion on a series of appropriations bills. While the move does not lower the chance of a federal government shutdown, it does represent some forward House movement on FY2024 after a series of logjams.
- 9/25/23: Moody’s Investor Services advises that a U.S. government shutdown would be seen as a credit negative event for the U.S.’ sovereign debt. While a shutdown would not directly impair the federal government’s ability to continue servicing its debt, it would highlight political risks. Fitch and S&P Global Ratings have both already downgraded U.S. debt citing political concerns stemming from debt ceiling debates.
- 9/21/23: The House failed to advance an FY2024 Defense Appropriations bill. Lead negotiators determine support for the Republican CR framework, as announced on 9/20, is insufficient.
- 9/20/23: The Problem Solvers Caucus, a bipartisan group in the House, unveil a plan to maintain federal spending levels via a CR through January 11, 2024 and form a commission “to review and recommend a package to stabilize long-term deficits and debt and require CBO to consider the cost of servicing the debt in its estimations.”
- 9/20/23: House leadership announced a framework to maintain spending via a continuing resolution (CR) that received widespread support among House Republicans.
- 9/12/23: House of Representatives returns to session from August recess.
- 9/5/23: Senate returns to session from August recess.
- 6/3/23: President Biden signs “The Fiscal Responsibility Act” into law, which suspends the federal debt ceiling through January 1, 2025 and sets the federal budget parameters for FY2024.
- 3/9/23: President Biden unveils his FY2024 Budget request.
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