Congress Extends Government Funding Through December 11

Well in advance of the September 30 fiscal year end, Congress completed action this week to extend current government funding levels through December 11. With the President expected to sign the bill into law, this action avoids politically costly brinksmanship, or a potential government shutdown, before the November midterms and provides additional time to complete the fiscal 2027 funding bills and other legislative priorities in a post-election lame duck session.

In early August, the Senate passed (90-6) a continuing resolution (CR) that extends final fiscal year 2026 (FY26) funding levels until December 11, and, this week, returning from its summer recess, the House swiftly approved (370-48) the CR. The President is expected to sign the bill shortly.

In addition to continuing the prohibition on the Administration’s ability to make unilateral changes to facilities and administrative (F&A or indirect) cost rates, the CR includes a new provision that temporarily blocks the finalization or implementation of the White House Office of Management and Budget’s proposed changes to the Uniform Guidance on Federal Financial Assistance, which codifies several of the President’s executive orders, expands the Administration’s authority to terminate federal awards midstream, and elevates political considerations over peer review. This new provision is a priority of Senate Appropriations Committee Chair Susan Collins (R-ME) and Ranking Member Patty Murray (R-WA), who, in response to broad engagement led by the research and higher education communities, have expressed an interest in extending the blocking language through FY27 as part of any end-of-year funding package.

FY27 Funding

With the CR guaranteeing government funding through December 11, final decisions on FY27 funding are not expected until after the election. So far, the House Appropriations Committee has advanced all 12 of its FY27 draft funding bills. The Senate has not released any of its versions due to political disagreements over President’s $1.5 trillion defense budget request, which has stalled negotiations on a topline funding level. Although the Senate Appropriations Committee may release drafts in the coming weeks, the continuing absence of key members and fast-approaching election make it unlikely that there will be any committee movement before the lame-duck session.

This chart includes the final FY26 funding levels, which are carried forward by this week’s CR, the President’s budget request and the House recommended funding levels for FY27. The House’s bills reflect Republican priorities and are seen as a floor for negotiations with the Senate, which has a bipartisan process and, historically, more generous funding levels for research and education. Notably, the House’s drafts reject the deep cuts proposed by the President but they still cut many agencies and programs of interest to higher education as part of a broader effort to constrain or reduce overall nondefense discretionary spending.

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Looking Ahead

With only a few weeks remaining before Congress breaks for the election, little significant progress is expected the rest of the September. Upon returning in November for the start of the lame-duck session, Congress will have the December CR deadline and the pending FY27 National Defense Authorization Act to consider, in addition to the Farm Bill and a host of other time-sensitive matters, including a potential third reconciliation package. The results of the election will determine what, how much, and when these priorities are resolved.

With all 435 House seats and 35 Senate seats on the ballot, major changes are in store for the 120^th Congress, which convenes in January 2027. Already, there are 83 confirmed members – 71 in the House and 12 in the Senate across both political parties – who will not return to Washington due to retirement, seeking other office, or primary losses. This represents one of the largest confirmed turnovers at this point in the process in decades and it portends one of the largest freshman classes in modern history. The magnitude of these changes means that there will be many members who are new to Congress and to leadership positions on committees and in party leadership – issues that will continue to be sorted during the lame duck session and early in the new Congress in January.

We will continue to follow these issues and be touch with updates. In the meantime, please be in touch with Suzanne Day (suzanne_day@harvard.edu), Kara Haas (kara_haas@harvard.edu), and Peter DeYoe (peter_deyoe@harvard.edu) with any questions.