November 12, 2025

President Trump has indicated he is headed to the White House where he is expected to sign the continuing budget bills that are largely stop gap measures designed to fund the federal government (generally) through January 30 although as we have noted previously, several federal agencies and initiatives will be funded through September 30.  Funding to HHS will resume through Jan. 30; however, SNAP benefits will resume in full and the funding for this Program will continue through the end of the federal fiscal year (September 30).  The deal going down today does NOT include an extension of ACA premium tax credits (enhanced subsidies) that are set to expire by the end of year.  Back pay for federal workers must resume at the ‘earliest date possible’. 

Congress narrowly clears a bill to end the nation’s longest shutdown.

NY Times Breaking News

The House on Wednesday gave final passage to a spending package to reopen the government, sending the legislation to President Trump’s desk and all but guaranteeing an end to the longest shutdown in the nation’s history.

The 222-to-209 vote came on Day 43 of the shutdown and days after eight senators in the Democratic caucus broke their own party’s blockade and joined Republicans in allowing the spending measure to move forward, prompting a bitter backlash in their ranks. It was the first time the House had held a vote in nearly two months, as it took an extended recess during the shutdown.

Six Democrats joined Republicans in approving the bill. Only two Republicans voted against it, Representatives Thomas Massie of Kentucky, and Greg Steube of Florida.

Mr. Trump was scheduled to sign the bill on Wednesday night. Earlier in the day, his budget office championed it in a statement as devoid of “any of the partisan, ‘poison pill’ provisions demanded by the Democrats.”

That was a reference to what had been Democrats’ chief demand in the shutdown fight, the extension of federal health care subsidies set to expire at the end of the year. Most congressional Republicans strongly oppose such an extension. And while Mr. Trump had initially shown a flash of interest in brokering a bipartisan deal on the issue, as the shutdown dragged on he made it clear that he had no interest in negotiating.

His refusal to do so ultimately led a critical group of Democrats in the Senate to conclude that with hundreds of thousands of federal workers furloughed, millions of Americans at risk of losing food assistance and millions more facing air-travel disruptions, it was time to find an off-ramp from the shutdown.

“History reminds us that shutdowns never change the outcome, only the cost paid by the American people,” Representative Tom Cole, Republican of Oklahoma and the chairman of the Appropriations Committee, said. “Over the last 43 days, the facts did not shift, the votes required did not shift and the path forward did not change.”

The Democratic defections in the Senate prompted outrage among House Democrats who, like most of their colleagues in the Senate, said their party should have held together firmly against any government funding bill that failed to address health care costs.

“We have federal workers across the country that have been missing paychecks,” Representative Alexandria Ocasio-Cortez, Democrat of New York, said. “We have SNAP recipients, millions of SNAP recipients across the country whose access to food stability was imperiled, and we have to figure out what that was for.”

Ms. Ocasio-Cortez said that the Trump administration had inflicted “cruelty” on the American people during the shutdown, including by trying to halt full federal funding for food stamps.

“We cannot enable this kind of cruelty with our cowardice,” she said.

Having elevated the health care subsidies as a political issue, Democrats are eager to keep the pressure on Republicans to extend them or face the consequences from voters who polls show overwhelmingly want to see them protected.

Representative Hakeem Jeffries of New York, the Democratic leader, said he and other party leaders would file a discharge petition — a procedural maneuver to steer around the leadership and force a bill to the floor — to extend the subsidies for three years. Such a measure is unlikely to pick up much Republican support.

“There are only two ways this fight will end,” Mr. Jeffries said on the House floor. “Either Republicans finally decide to extend the Affordable Care Act tax credits this year. Or the American people will throw Republicans out of their jobs next year and end the speakership of Donald J. Trump once and for all.”

The compromise measure the House approved on Wednesday includes a spending package that would fund the government through January, as well as three separate spending bills to cover programs related to agriculture, military construction, veterans and legislative agencies for most of 2026.

The package includes a provision that would reverse layoffs of federal workers made during the shutdown and ensure retroactive pay for those who have been furloughed.

And it includes a measure that would provide a wide legal avenue for Republican senators whose phone records were seized as part of the investigation by Jack Smith, the former special counsel, into the attack on the Capitol on Jan. 6, 2021, to sue the government for at least half a million dollars each.

That provision was quietly slipped into the spending deal by Senate leaders, and provoked wide, bipartisan ire among House lawmakers who have said they are looking for future avenues to strike it down. If they had sought to take it out of the spending deal, it would have prolonged the shutdown, because any changes the House made would have sent the measure back to the Senate for final approval.

Representative Chip Roy of Texas, a conservative Republican who was one of the Biden Department of Justice’s harshest critics, said it was “beside my comprehension that this got put in the bill, and it is why people have such a low opinion of this town.”

Mr. Johnson said on Wednesday ahead of the vote that House Republicans would introduce legislation to repeal that provision, and would fast-track the measure for a vote as early as next week.

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On the homefront, New York’s State Budget process began today with a ‘quick start’ meeting as described (below).  The outlook is better than expected although it’s all relative and this could change on a dime.  

Here’s more from Dan Clark at Capitol Confidential:

New York’s financial outlook ‘is brighter than initially expected,’ Blake Washington says

When Gov. Kathy Hochul and Democrats in the state Legislature struck a deal on the state budget in May, they expected doom and gloom for the current fiscal year.

There were significant risks to the $254 billion spending plan. That list was long, ranging from the impact of tariffs to cuts in funding from the federal government.

That risk became tangible when Republicans in Congress approved the “One Big Beautiful Bill,” which did not extend premium health care tax credits and other subsidies that had been allowed for lawfully present migrants in the U.S.

That, and other changes from the bill, blew a $3 billion hole in next year’s state budget, the Hochul administration has projected. The doom and gloom had arrived.

But in the background of all of that, something else was happening that the state hadn’t expected and was pleasantly surprised to learn.

Tax receipts had come in higher than projected — by billions of dollars, as I told you on Halloween when I laid out the state Division of Budget’s mid-year update published the night before.

The Hochul administration is now expecting tax receipts to be $2.6 billion higher for the current fiscal year, ending in March, and $5.3 billion in the next fiscal year. That’s largely due to higher-than-expected income tax receipts.

State Budget Director Blake Washington laid out the rest of the numbers Wednesday at the annual “Quick Start” meeting at the state Capitol.

It’s the first step toward next year’s state budget. Washington shares his team’s projections on revenue and spending for the upcoming state budget and representatives from both chambers of the state Legislature bring their own for comparison.

The rosier revenue results have now made next year’s state budget gap — revised down to $4.2 billion from $7.5 billion — easier to resolve, Washington said.

“We see this number as one that’s completely manageable,” he said.

The new $4.2 billion gap is not a small amount of money. It’s more than what Hochul and lawmakers had to come up with to fund the MTA’s five-year capital plan in the most recent state budget.

I followed up with Washington after the meeting to ask what he meant by “manageable.”

“You manage it as any year. You look at what you’re spending on,” Washington said.

“You ask yourself, ‘is every bit of this essential?’ You also take a catalog of what you’ve done for the last handful of years and you say to yourself: ‘Have we invested appropriately in these items and do we need to do more at this stage of the game or can we moderate spending coming into that decision-making process?’ Those are the decisions we’re going to be making in the next handful of weeks,” he said.

Representatives from the state Legislature — Ways and Means Secretary Philip Fields and new Senate Finance Secretary Christopher Friend — had their own projections for revenue and spending.

It’s easier for me to show you how these all compare by using bulleted lists.

State spending: Here’s what Washington and the Legislature are now projecting for state spending. This doesn’t include the state’s use of federal funds so they’re much smaller than the full budget.

• Division of Budget: $155.6 billion
• State Senate Majority: $155.6 billion
• State Assembly Majority: $155.7 billion

The minority conferences are projecting less than the state Division of Budget but it’s within a few hundred million dollars.

“I think people at home should have comfort in knowing that the Legislature, the Executive Branch — we’re all plus or minus around the same,” Washington said.

State revenue (current year): So there isn’t a ton of disagreement there. Revenue projections are a different story, with the Assembly planning for nearly $2 billion more in the current fiscal year than the Hochul administration.

• Division of Budget: $129 billion
• State Senate Majority: $130.1 billion
• State Assembly Majority: $130.8 billion

State revenue (next year): The trickier number to project is how much revenue the state will generate over the year beginning in April 2026.

The Hochul administration and the state Legislature agree that economic growth is expected to slow in 2026. That includes personal income, which is the state’s largest driver of revenue.

But they’re similarly divided on what that will mean for total revenue in the next fiscal year, with the Assembly again holding a more optimistic view.

• Division of Budget: $131.5 billion
• State Senate Majority: $132.9 billion
• State Assembly Majority: $133 billion

The risks that could torpedo those revenue projections

There’s always a chance of an economic downturn that could significantly slow the state’s tax receipts.

But there are specific weak points in New York’s economy that could have a huge impact on the state budget, Washington said.

“We have resources that are being generated from finance, insurance and the high-tech sector, and they provide for a disproportionate amount of tax revenue,” Washington said. “A downturn among any of those sectors has an immediate impact upon the state’s fiscal system.”

And while the state has projected an initial fiscal impact from the “One Big Beautiful Bill” — which assumes New York will backfill some of the cuts — the impact in the outyears is harder to predict.

“There’s some persistent inflation (and) impacts coming down from the federal government and (the bill) that we have to react to and continue funding for services in health care, social services, Foundation Aid and a litany of other important issues,” said Friend, the Senate finance secretary.

That doesn’t mean they can’t pivot next year if they have to, added Fields, the Assembly’s Ways and Means secretary.

“We’re looking to refine our forecast and make any adjustments as necessary as well as prepare ourselves for any exogenous proposals that will come in the upcoming fiscal year,” Fields said.