Lawmakers Reach Tentative Agreement On $1.7 Trillion Funding Deal For 2023 — But Republican Opposition Persists With Days To Go Before Shutdown

Topline

Bipartisan negotiators in Congress unveiled a $1.7 trillion government spending package early Tuesday morning that would fund the federal government for the rest of the current fiscal year and must pass by Friday at midnight to stave off a shutdown–and avoid what would be a messy showdown between a split Congress at start of the next session in January.

Key Facts

The $1.7 trillion deal, known as the “omnibus package” since it encompasses 12 separate appropriations bills, was unveiled around 1:30 a.m. on Tuesday and includes $858 billion in defense spending, consistent with the 10% increase from the previous fiscal year Congress approved in the National Defense Authorization Act earlier this month, and $773 billion in what’s referred to as “non-defense” funding, a $42.5 billion increase from fiscal year 2022 funding, according to a statement from Senate Appropriations Committee Chairman Patrick Leahy (D-Vt.).

Among the wins for Democrats were the inclusion of a bill to reform the Electoral Count Act in an effort to prevent a repeat of former President Donald Trump’s attempts to overturn the 2020 presidential election results; Democrats also secured $45 billion in additional funding for Ukraine, about $7 billion more than President Joe Biden had requested, despite some Republican opposition.

Republicans cheered the 10% increase in defense-related spending and claimed to have held the increase in non-defense spending below the inflation rate, while successfully diverting Biden’s request for an additional $10 billion in pandemic relief funds.

Both parties made concessions on tax-related issues: the bill does not grant Republicans’ wishes to extend business tax breaks approved in 2017, nor does it encompass the expansion of the child tax credit, which offers tax breaks for low-income families, that Democrats hoped to include.

Tangent

The spending deal also includes legislation that would ban TikTok on all federal government devices. The bill, which passed the Senate earlier this month and is sponsored by Sen. Josh Hawley (D-Miss.), is aimed at preventing cybersecurity risks posed by the Chinese government. TikTok is owned by Chinese company ByteDance and the app featured politically motivated content targeting the U.S. midterm election from Chinese government-operated accounts that did not disclose their affiliation with Beijing, Forbes exclusively reported.

Key Background

Congress passed a short-term funding bill on Thursday that maintained fiscal year 2022 funding levels and expires Friday at midnight. The legislation was a continuation of another stopgap measure passed ahead of the fiscal year 2022 deadline on September 30 that allowed the government to continue operating at current appropriations levels through December 16. Legislators agreed to the continuation last week to give them more time to work out a full-year funding package that would set new appropriations for the duration of the current fiscal year, through September 2023. Some Republicans, including Rep. Kevin McCarthy (R-Calif.), publicly oppose passing the full-year deal before Republicans take over the House in January and would have more leverage to negotiate a new package. But Senate leadership on both sides of the aisle–and privately, even McCarthy, according to multiple reports–are hesitant to set the stage for what would be a messy fight early next session between a split Congress, when a negotiating stalemate that could lead to a government shutdown may be even more likely.

Chief Critic

A coalition of House Republicans urged their counterparts in the Senate to reject the deal and threatened to whip votes to oppose any future legislation backed by Republican senators who vote for the omnibus. “Kill this terrible bill or there is no point in pretending we are a united party, and we must prepare for a new political reality,” the 13 conservative House members, including Rep. Matt Gaetz (Fla.) and Chip Roy (Tx.), wrote in a letter to Senate Republicans.

What To Watch For

The Senate is expected to hold a procedural vote on the package Tuesday and leadership hopes all 100 Senators will vote in favor of the bill to speed up the legislative process. While Senate Minority Leader Mitch McConnell cheered the deal, not all Republican senators are on board. Sen. Mike Lee (R-Utah) suggested the 4,155-page bill’s release just three days before the government shutdown-deadline equated to a “backroom deal,” he tweeted Tuesday. “The Bible is about 1200 pages long. Could you read it 3 times before Friday?”

Further Reading

Senate Passes Stopgap Funding Bill, Averting Government Shutdown (Forbes)

Congress Has Just Five Days To Avert A Government Shutdown—Here’s Where Negotiations Stand (Forbes)

Congress Reaches Deal To Avert Government Shutdown For 9 More Days — Teeing Up Another Clash (Forbes)