NEWS | Congress Nears a Government Funding Deal, Avoiding Harmful Shutdown to Small Business
- NSBA
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NSBA continues urging Congress to work to pass a funding package to avert another shutdown, which always harms small business.
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.
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.
Key Updates and Agency Funding
Funding negotiations have produced detailed packages covering agencies like HUD, Labor, HHS, Transportation, and more, which is a reflection of bicameral cooperation aimed at finishing full-year appropriations well before the funding deadline.
Lawmakers also approved a $24.4 billion NASA budget for 2026 that rejects deep cuts proposed by the White House, preserving critical programs including human spaceflight and scientific research centered in Houston and other hubs.
Continued bipartisan opposition to cuts at NIH, with the latest package allocating more than $48 billion to biomedical research, which is a clear rebuke to prior White House proposals.
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. While the 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.
In sum, 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.
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