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By Cecile Entleitner, Senior Associate,
Blakey & Agnew
While New Year’s celebrations are often associated with fireworks, champagne, or festivities with family and friends, Congress has established a slightly different tradition to ring in the new year – the
new fiscal year, that is. On September 30,
Congress circumvented a potential government shutdown through a measure that has become customary in recent decades; a continuing resolution (CR). The legislation extends federal funding through December 16, postponing further appropriations negotiations until after the
midterm elections.
Every year, Congress must pass 12 appropriations bills through both chambers to provide new funding for federal agencies. If lawmakers are unable to reach an agreement by midnight on September 30, Congress can instead enact temporary appropriations through a CR. According to a recent report by the U.S. Government Accountability Office, the federal government has operated under one or more CRs for all but three fiscal years since 1977 – the last time a full-year appropriations package was passed prior to the new fiscal year was in 1997. As some individual appropriations bills can be more challenging to advance than others, Congress may seek to avert a widespread shutdown by separating the spending bills with sufficient support to pass both the House and Senate. Most recently in 2019, Congress passed 5 of its 12 funding bills while a 34-day lapse in appropriations resulted in a partial shutdown of the agencies covered by the remaining 7 bills, which included portions of the U.S. Department of Transportation (USDOT), the Surface Transportation Board, and the Federal Maritime Commission.
Whereas annual appropriations bills can make significant changes to funding levels and establish new programs or policy provisions, CRs typically extend existing funding amounts without major changes to most programs. However, exceptions can be made to address emergencies or other immediate priorities. For example, in 2020, Congress passed a CR that also incorporated a one-year extension of the Fixing America's Surface Transportation (FAST) Act, which was set to expire the same day as the annual appropriations law. While this year’s CR did not include any notable exceptions related to transportation, it did provide additional disaster recovery funding and aid for Ukraine, among other provisions. Not included in the final CR text were energy permitting reform measures proposed by Sen. Manchin (D-WV). As part of an agreement between the Senator and Majority Leader Schumer (D-NY) to ensure passage of the Inflation Reduction Act earlier this year, the permitting changes were originally incorporated into the CR. However, due to opposition from both progressive Democrats as well as Republicans, the
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language was removed from the CR prior to the Senate vote.
The CR ultimately passed the Senate by a bipartisan vote and subsequently advanced through the House on a party-line vote, marking the last scheduled votes before the midterm elections in November.
In the meantime, USDOT and other federal agencies will continue operating under the 11-week CR. For USDOT specifically, the CR’s effect on funding included in the Bipartisan Infrastructure Law (BIL) depends on the funding source. The BIL provided contract authority from the Highway Trust Fund as well as direct appropriations from the Treasury’s General Fund. The direct appropriations, which total nearly $37 billion for FY23, are not subject to the CR and have already been made available. However, the amount of contract authority that can be obligated is limited to the pro-rated funding extension provided by the CR. This restriction and the uncertainty of final funding levels can impact state construction planning efforts as well as USDOT’s ability to make grant awards for programs funded through contract authority.
When lawmakers return to D.C. in mid-November, negotiations will resume to advance an appropriations package for the remainder of the 2023 fiscal year, or, if necessary, enact an additional CR. Both the House and Senate introduced appropriations proposals earlier this year, which included roughly $105 billion in funding for USDOT programs and operations. The House passed its version in July – though it subsequently stalled in the Senate, while the Senate bill did not receive a committee or floor vote. Both proposals were opposed by congressional Republicans, who argued the measures promoted partisan priorities and wasteful spending. The results of the November elections could impact funding negotiations and the outlook for passage of either a full appropriations law or a CR, particularly if the election outcome triggers changes in leadership. Nevertheless, the clock will be ticking for Congress to resolve its differences by December 16 – just in time for the rest of us to prepare for our own New Year’s traditions.
Blakey & Agnew, LLC is a public affairs and
communications consulting firm based in
Washington, DC.
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