STOP GAP/APPROPRIATIONS PICTURE MAY GET CLEARER THIS WEEK

Although the House is scheduled to vote on Tuesday on a new Continuing Resolution (CR) to fund the government until January, few details have emerged about what could be in it.  The good news for contractors and their customers is that  House Speaker Mike Johnson (R-LA) has said that he does not believe that there will be a shutdown.  He has reportedly been working on a measure that would garner enough votes to pass the House, though its future in the Senate would be uncertain.  Conservative House Republicans have argued for a “ladder” approach, which would set tiered funding times based on specific agencies.  The idea is to have Congress pass specific appropriations bills, instead of the now-usual omnibus measure.  Under a ladder approach DHS funding, for example, would be ensured until January 15th, by which time Congress would either have to pass the DHS FY’24 appropriations bill or a specific, DHS-only CR.  There would be different dates for each agency.  Unsurprisingly, most of the Senate and many rank-and-file House members oppose this option as it would potentially bring chaos.  Government contractors and their customers would likely be caught up in the chaos, not knowing which agencies were open, to what extent, and whether funding was available for specific projects.  Current reports indicate that the ladder approach may not hold water, but that House conservatives will have to be given some type of policy “win” to gain their support for a CR.  While the current CR did not require their support, it also ended the speakership of Rep. Kevin McCarthy, a fact surely not lost on Speaker Johnson.  While a shutdown does not currently appear likely, contractors and their government customers will have to continue watching how the situation unfolds.  It is likely that nothing will be enacted much earlier than it needs to be, and, in addition, a 24- or 48-hour CR can’t be ruled out to get a longer measure that can actually pass crafted.