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Bullet policy · Sep 27, 2021

Congress Considers Stopgap Funding, Debt Ceiling Suspension

The House has passed a stopgap funding bill along party lines to keep the government operational at level-funding until December 3, 2021. The bill also includes a measure to suspend the U.S. debt ceiling through December 2022 and provide more than $26 billion in emergency aid for natural disasters.

“We believe a suspension of the debt limit through December 2022 would provide an amount of time commensurate with the debt incurred as a result of passing last winter’s bipartisan $908 billion emergency COVID relief legislation,” said House Speaker Nancy Pelosi (D-CA) and Senate Majority Leader Chuck Schumer (D-NY).

Partisan disagreements over the debt limit provision could endanger the prospects of passing the stopgap continuing resolution by the September 30 deadline, triggering a government shutdown. The Senate will vote today on the continuing resolution, which requires 60 votes to advance. Republican lawmakers, who are opposed to a debt hike or suspension, have indicated that they will block the measure in the Senate but would support a short-term spending and disaster aid bill without the debt provision. Some Republicans have called on Democrats to use the budget reconciliation bill to raise the debt ceiling. “The Democrats have a mechanism already in place to use reconciliation to pass it with a simple majority of the Senate, if they want to raise and spend another $5 trillion,” said House Minority Leader Kevin McCarthy (R-CA). It is estimated that the U.S. Treasury will run out of money to pay its obligations by sometime in late-October or early-November. It is unclear if a reconciliation package could be finalized in time to avert a default.

With Congress deadlocked over the stopgap measure, the White House has asked federal agencies to review their plans for a possible shutdown. “Prudent management requires that the government plan for the possibility of a lapse in funding, said Abdullah Hasan, a spokesperson for the Office of Management and Budget (OMB). “Consistent with long-standing practice across multiple administrations, OMB is preparing for any contingency, and determinations about specific programs are being actively reviewed by agencies.”

The House has passed 10 out of the 12 fiscal year (FY) 2022 appropriations bills, but progress has stalled in the Senate as a result of partisan disagreements over topline spending levels. Passing the continuing resolution will allow additional time to finalize the spending bills. Additionally, a $1 trillion bipartisan infrastructure bill awaits consideration in the House today and a separate $3.5 trillion social policy and climate focused reconciliation bill, which is still being negotiated, is also expected to be voted on by the House this week. Meanwhile, negotiations over a bipartisan innovation package that includes spending reauthorizations for the National Science Foundation and the Department of Energy have slowed down as a result of the focus on the reconciliation bill.

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