TIMING, CLAWBACKS, AND A POTENTIAL SHUTDOWN: WELCOME TO THE ANNUAL APPROPRIATIONS CIRCUS

Both the House and Senate are scheduled to vote on at least some of the FY’24 appropriations bills this month, an occurrence that could lead some to hope for on-time passage of next year’s spending bills.  Further investigation, though, shows that this would likely be a false hope.  House leaders have said that they plan to vote only on one or two measures in July.  The remaining 10 will not see final House action until September.  The Senate is likely to follow suit.  All of this means that the multiple conferences to iron out differences between each measure would have to be concluded in just a few days in order to be finalized by September 30th.  That’s not likely to happen, resulting in FY’24 starting under a continuing resolution.  As they say on TV, however, “wait, there’s more”.  Appropriators in both chambers are “clawing back” already authorized money that has yet to be committed.  This impacts spending on everything from the IT Modernization Fund to IRS allocations.  Essentially, Hill leaders want to take that money that’s already been appropriated for this year and re-obligate it for other projects as a way to limit overall spending increases next year.  As a result, contractors and their customers should check again to see if the money you thought would be available actually is.  There’s also a real possibility of a shutdown as partisan lawmakers hold up action on even a short-term CR to make a point about reductions in spending they’d like to see.  No one is talking about the sequestration trigger, but it is technically still on the books if Congress fails to act by midnight September 30thHope may spring eternal, but reality is the mud puddle that can blur your view on what’s ahead.  Stay tuned.