Overview
Congress will return after the elections with unfinished FY27 appropriations bills and a December 11 funding deadline. Whether lawmakers complete those bills, extend funding into 2027, or pursue a combination of each will depend on more than the election results. The central questions are whether negotiators can reach a funding agreement quickly enough and whether congressional leaders and the White House will support the compromises necessary to enact it.
Clear the Decks or Buy More Time? The election results will shape each party's calculation about whether to finish work on FY27 funding or carry it into the new Congress through a continuing resolution or government shutdown. Should Republicans retain both chambers, they could favor clearing the decks to focus on new funding priorities next year. Democrats winning either chamber would face a choice: stall on FY27 to wait for the leverage of majority control or finish FY27 to clear the slate for the new Congress. Democratic appropriators have expressed interest in the latter. Whether party leaders and the administration share appropriators' desire to close the book on FY27 in the lame duck will help determine the outcome. No election result guarantees a December deal.
First, Do the Math. The biggest obstacle may be reaching agreement on overall discretionary spending and the balance between defense and non-defense funding. Discussions this fall among the House and Senate majority and minority appropriations staff present an opening, but much work is still needed to reach an agreement. Until the overall framework is settled, subcommittees face limits on resolving the smaller details within their individual bills. With only four session weeks remaining before the funding deadline, they will need to act quickly.
One possible approach is a return to minibuses, beginning with measures where agreement is more attainable and leaving more difficult bills, such as Defense and Labor-HHS-Education, for later. That could produce momentum and allow Congress to complete part of its work. It could also leave the most contentious decisions unresolved as the deadline approaches. An early funding agreement would give appropriators more room to negotiate the unresolved issues; a late agreement would narrow the options.
The Other End of Pennsylvania Avenue. Even if Congress reaches a bipartisan agreement, White House support will be needed to get it across the finish line. Negotiations are likely to extend beyond funding levels to disputes over rescissions, reprogramming, policy provisions, and how the administration executes enacted spending. For some lawmakers, assurances about implementation may be as important as the amounts appropriated. The willingness of the administration and congressional negotiators to resolve those issues could determine both the scope and timing of a final package.
The president is the wild card. He has not hesitated to unravel carefully negotiated bipartisan agreements in the past, and a looming Democratic Congress poised to intensify oversight and constrain his governing agenda could lead him to press Republicans to use their remaining leverage in the lame duck to lock in key priorities before the political landscape shifts.
This dynamic could also revive discussion of a Reconciliation 3.0. Most observers view a third reconciliation package as a long shot given the procedural, political, and attendance challenges Republicans would face during the lame duck. Senate Majority Leader John Thune (R-SD) has expressed similar skepticism. Still, some Republicans view the post-election session as a narrow window to advance priorities that could become far more difficult to enact next year. As Senator Bernie Moreno (R-OH) put it, a third reconciliation bill could represent Republicans' version of the "Last Supper" before the balance of power shifts, creating a powerful incentive to make the most of their remaining time in the majority. That said, any attempt to move a partisan reconciliation bill could complicate efforts to reach a bipartisan funding agreement.
Recess Is Not a Waiting Period. Stakeholders should confirm where their priorities stand in House bill text and reports and engage Senate staff as the chamber prepares its post-election versions of both. This is also the time to refresh the justification for funding requests, review existing statutory and report language, and explain the practical consequences of delay. Priorities included in one chamber's proposal still need to be protected through final negotiations.
At the same time, organizations should engage agencies and the OMB as the administration develops the president's FY28 budget request. Making the case for funding and policy priorities now can help shape the starting point for the next appropriations cycle, even while FY27 remains unfinished.
Planning should account for different outcomes across agencies and accounts. A few bills could become law while others remain under a continuing resolution into 2027. Stakeholders should be prepared for the possibility of both FY27 enactment and continued temporary funding, as well as the possibility of managing both simultaneously.
Our take: While enactment of all 12 bills, a full-year CR, or even a government shutdown remain possible, we think a hybrid outcome is most likely: a small minibus, potentially anchored by Military Construction-VA and other less controversial bills, followed by a CR extending consideration of the remaining bills into 2027. If appropriators, congressional leadership, and the administration can reach an agreement on an overall funding framework relatively quickly, lawmakers may still have a path to advance several minibuses or individual appropriations bills. The longer those negotiations drag on, the more likely lawmakers will defer difficult funding and policy decisions to the 120th Congress.
