Congress reaches tentative spending deal – though it may be too late to avert government shutdown

Congressional leaders are understood to have reached a tentative spending deal to bankroll the Department of Homeland Security (DHS) late on Monday – passing a sticking point that should enable negotiators to process the remaining funding bills and avert a partial government shutdown later this week.

As it stands, funding is set to expire on Saturday morning for the departments of Homeland Security, State, Defense, Labour and Health and Human Services.

House Speaker Mike Johnson announced the agreement on Tuesday morning.

“An agreement has been reached for DHS appropriations, which will allow completion of the FY24 appropriations process,” Mr Johnson said. “House and Senate committees have begun drafting bill text to be prepared for release and consideration by the full House and Senate as soon as possible.”

The spending bills will keep the government open until Fiscal Year 2024 ends on 30 September, just weeks before the 2024 presidential elections.

President Joe Biden commended negotiators in a statement on Tuesday.

“We have come to an agreement with Congressional leaders on a path forward for the remaining full-year funding bills. The House and Senate are now working to finalize a package that can quickly be brought to the floor, and I will sign it immediately.”

While the terms of the deal remain unclear, it now paves the way for the resolution of six bills relating to its sister departments, which were largely settled last week.

However, despite the sign of progress, Congress is still in a race against time to pass the spending measures and avoid a short-term government shutdown.

Six months into the fiscal year, Congress is still only about halfway towards passing spending measures ultimately expected to be worth about $1.65trn.

Lawmakers passed the first tranche of six spending bills in early March, funding about 30 per cent of the US government.

Now, they are focused on the larger second package and, in what has become routine, find themselves sailing close to the deadline for the expiration of federal funding as a result of deep policy divisions between Republicans and Democrats.

The bill to fund the DHS, which is responsible for securing and managing America’s borders, has proven difficult to resolve as the question of illegal immigration at the US’s southern border with Mexico has become a central issue in presidential election year.

House Speaker Mike Johnson (AP)
House Speaker Mike Johnson (AP)

The stakes for both sides are immense as the flow of migrants crossing the southern border far outpaces the capacity of the US immigration system to deal with it, with each side of the aisle blaming the other for failing to find an answer to the crisis.

Negotiators in Congress have, however, been moving toward a simple solution: passing a continuing resolution that would mostly extend funding for the DHS, though with some increase on 2023 spending levels.

On the DHS specifically, she said Mr Biden’s administration had “maximised their operations” and removed more illegal immigrants in the past 10 months than during any year since the 2013 fiscal year.

Ms Jean-Pierre said it was important to continue “that operational pace” and added: “Obviously, we believe DHS needs additional funding. We’ve always said that.”

Even with the possible release of legislative text early this week by the House Appropriations Committee, it is still unclear whether Congress can definitely avoid a partial shutdown, however brief.

Most of the “no” votes are expected to come from hard-right Republicans, who have been critical of the overall spending levels as well as the lack of policy mandates sought by some conservatives, such as restricting abortion access, eliminating diversity and inclusion programmes within federal agencies and banning gender-affirming care.

House Freedom Caucus Chairman Bob Good led a group of hard-right conservatives who demanded that a spending bill include provisions from the House-passed Secure the Border Act, which would restrict immigration.

“At some point, border security has to be more than a talking point or a campaign promise,” Mr Good posted on X/Twitter. “What are House Republicans prepared to do? When will we say “not on our watch” and back up those words with action? Stop funding the invasion!”

Assuming the bill passes the House, the Senate will then have to act on it and its passage will depend on all senators agreeing on speeding up the process to reach a final vote before its deadline of midnight on Friday.

Such agreements typically require Senate Majority Leader Chuck Schumer to allow for votes on amendments to a bill in return for an expedited final vote.

The package being finalised this week is expected to provide about $886bn for the Pentagon.

Overall, the two spending packages provide around a 3 per cent boost for defence, while keeping non-defence spending roughly in line with the year before.

That is in keeping with an agreement that former speaker Kevin McCarthy worked out with the White House, which restricted spending for two years and suspended the debt ceiling into January 2025 so the federal government could continue paying its bills.

House Republicans have been determined to end the practice of packaging all 12 annual spending bills into one massive bill known as an omnibus.

They have at least succeeded in breaking the spending bills into two seemingly more manageable parts this time around.

Additional reporting by agencies