HomeWashington Letter2018 ▶ Federal Government Shutdown Looms as Congress Fails to Agree on Annual Spending
Federal Government Shutdown Looms as Congress Fails to Agree on Annual Spending

As of Friday afternoon, a shutdown of the federal government appears likely as Congress has failed to resolve disagreement over fiscal year 2018 spending, an overall budget agreement.  The current impasse surrounds the Congress and White House leadership’s failure to reach an agreement on the status of young undocumented immigrants, an issue known as “DACA.” The current measure providing government spending expires at midnight on Jan. 19, 2018, at which point if another government spending bill has not been enacted, the federal government will shut down. President Trump has cancelled a weekend trip to Florida and is currently negotiating with congressional leaders on a deal to avert a shutdown. On Friday afternoon, he met privately with Senate Minority Leader Chuck Schumer.

On Jan. 18, the House of Representatives passed a short-term spending measure for fiscal year (FY) 2018, by a mainly party-line vote of 230 – 197, that would extend government funding until Feb. 16, 2018 and additionally provide a six-year funding renewal for the Children’s Health Insurance Program (CHIP). However, the bill lacks the necessary 60 votes needed to pass in the Senate. Senate Democrats are opposed to the bill because it does not include disaster relief, funding renewals for community health centers and the National Health Service Corp and a DACA fix. A number of Senate Republicans are also opposed to the FY2018 spending bill, due to objections over the lack of full year defense funding, a DACA fix and dissatisfaction with reliance on short-term government spending fixes, rather than a long-term budget deal.

Earlier Friday, Minority Leader Schumer proposed an alternative plan for Congress to enact a four-day government spending measure, but this was rejected by Republican leaders in both chambers. On Friday afternoon, House Republican leaders permitted House members to depart Washington, DC, further increasing the likelihood of a government shutdown. If a shutdown does occur, we do not know how long it will last, although it is possible that it may last only the weekend, in which case, there would be minimal effects. But if Congress and the president do enact a FY2018 spending agreement by the evening of Jan. 21, about half of the federal government workforce will be placed on furlough and some government services will not be in operation. The ATS will keep members posted on the developments.

Last Reviewed: January 19, 2018