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Government Shutdown

• Funding for much of the federal government lapsed on October 1 with the start of a new fiscal year. Government funding is supposed to be enacted through passage of 12 annual appropriations bills or a stopgap measure known as a continuing resolution (CR) that will keep funding levels as-is from the previous year for a temporary amount of time. No FY26 appropriations bills have yet been agreed to by both chambers. 
• The House passed a “clean” (free of any policy changes) CR that would fund the government through November 21, 2025. That bill has failed three attempts to reach the 60-vote threshold needed for passage in the Senate, with a majority of Senate Democrats opposing. 
• Senate Democrats offered their own CR that would have rolled back Medicaid cuts, permanently extended enhanced Affordable Care Act tax credits, and limited the capabilities of the Administration to rescind funding already appropriated by Congress. This bill also failed when brought to the floor for a vote.
• Republican leaders today made it clear that they have no plans to cede to the Democrats’ demands and said that Republicans will not engage in policy changes until Democrats first agree to vote to reopen the government.
• Unlike in past shutdowns, President Trump and Office of Management and Budget Director Russ Vought have threatened to enact mass layoffs of federal workers unless Democrats vote in favor of reopening the government. We are also seeing rollbacks of federal funding for projects primarily in blue states.
• Each federal agency will publish contingency guidance for government workers, detailing essential from nonessential work. As of today, even senior leadership in some federal agencies have been furloughed. 
• Glimmer of hope? Three Senate Democrats have joined Republicans in voting to pass the CR and reopen the government – however, that’s still far from the number of Democrats needed. With that said, there have been bipartisan discussions among Senate R’s and D’s on a path forward for the ACA subsidies, leading to chatter that the shutdown may not last as long as the roughly 40-day shutdown in 2018. More to come.

The House and Senate are both in session next week, despite the government being shutdown.  

Please reach out to the authors or your Foley relationship partner if you are facing any issues, or if you have any questions, with the ongoing changes by the Trump administration.