NEWS | Congress Nears a Government Funding Deal, Avoiding Harmful Shutdown to Small Business

NSBA continues urging Congress to work to pass a funding package to avert another shutdown, which always harms small business.

JAN. 22, 2026, UPDATE | Congress is racing to pass the remaining fiscal year 2026 appropriations bills before the January 30 funding deadline to avoid a partial government shutdown. Lawmakers have completed agreements on all 12 annual spending bills through bipartisan negotiations, dividing them into "minibus" packages. To recap recent efforts:

House Republicans advanced a major $1.2 trillion package today, covering several large agencies. This includes funding for the Pentagon (Defense), Labor-HHS-Education, Transportation-HUD, and a separate measure for Homeland Security (DHS), which provides $10 billion for ICE through September.

The House cleared procedural hurdles by a close 214-213 rule vote, and is set for final votes later today, potentially sending the bills to the Senate.

This package follows the release of the bill text earlier in the week, a 1,059-page bipartisan deal that boosts funding in areas like HUD programs - up ~$7.3 billion to $77.3 billion total, while avoiding deep cuts proposed by the administration in some sectors.

Earlier packages for Commerce/Justice/Science, Energy/Water, Interior, Financial Services, and others, have already passed one or both chambers, marking progress toward full-year funding.

Among the holdups and persisting controversies for passage, Democrats are criticizing the DHS/ICE provisions for lacking restrictions on immigration enforcement amid President Trump's mass deportation plans, potentially complicating Senate passage, which may require 60 votes to overcome a filibuster in the Upper Chamber.

Internal GOP tensions over issues like ethanol policy and earmarks, though leadership quelled revolts to advance the bills.

Today, President Trump stated in an interview that another shutdown is "probably" likely, calling it a potential "Democrat shutdown," despite ongoing negotiations.

Overall, a shutdown appears less likely than earlier feared, as deals are in place and votes are progressing, but the final steps, including House passage, Senate action, and presidential signature, must occur quickly before January 30.

Six of the 12 bills are already cleared in some form, with the focus now on these last, contentious ones.For the most real-time status, check sources like Congress.gov, Politico's live updates, or the House/Senate Appropriations Committees.

Follow NSBA for funding updates from Capitol Hill.

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JAN. 21, 2026 | This of this week, lawmakers are moving quickly to avert another potential funding lapse ahead of the January 30 deadline, crafting a comprehensive spending package that would keep the federal government open and fully funded for the remainder of Fiscal Year 2026. With six of the 12 annual appropriations bills already passed through both chambers and others advancing, leadership from both parties is signaling readiness to bring a bipartisan agreement to the floor this week.

The emerging plan is anchored by a $1.2 trillion funding agreement that covers major departments including Defense, Homeland Security, Health and Human Services, Education, Transportation, and Housing. Most Democrats are expected to oppose the Homeland Security portion due to controversy over Immigration and Customs Enforcement funding and oversight, but the overall package still has a path to passage in the narrowly divided House.

RELATED | NSBA Keeps Small Business Hardwired to What's Happening in Washington

Appropriators from both parties have so far largely rejected steep funding reductions proposed in the Trump administration’s budget. Committees have proposed maintaining or increasing key agency budgets, including education and research funding, and have actively worked to increase NIH funding, despite presidential proposals to cut it significantly.

A separate focus of this week’s funding news is preserving federal science and education budgets. Both House and Senate appropriations leaders have pushed back against deep cuts to the Department of Education and NIH, instead crafting bills that maintain current spending levels or add modest increases, signaling strong congressional support for medical research and education programs.

Congress is under pressure to finalize the remaining fiscal year spending bills or pass a continuing resolution to avoid disruption for federal agencies and programs. After the longest shutdown in U.S. history last year highlighted the risks of delayed appropriations, current bipartisan momentum suggests leaders want to finalize deals with less brinkmanship.

Long story short, this week’s developments show Congress largely coalescing around a bipartisan funding framework that balances departmental priorities, preserves key programs, and seeks to avoid another shutdown, even as disagreements over specific funding streams remain visible on issues like DHS and immigration enforcement.

Follow NSBA for the latest from Capitol Hill.