The United States Congress has unveiled a proposed short-term spending bill, a hefty 1,547-page document, designed to avert a government shutdown by extending funding through March 14, 2025. The current funding is set to expire on December 20, 2024, leaving little time for deliberation and passage. Despite its “short-term” label, the bill addresses a wide range of issues, reflecting the diverse priorities and ongoing debates within the legislative body. Primarily, it maintains fiscal year 2024 funding levels for most government programs and activities, including the military, ensuring continuity in essential operations.
A significant portion of the bill is dedicated to disaster relief, allocating approximately $100 billion for recovery efforts related to Hurricanes Helene and Milton, and bolstering the depleted Federal Emergency Management Agency (FEMA) disaster fund with an additional $29 billion. This injection of funds aims to address the urgent needs of affected communities and replenish FEMA’s capacity to respond to future emergencies. Further demonstrating its focus on recovery and infrastructure, the bill includes provisions for rebuilding the Francis Scott Key Bridge in Baltimore, damaged earlier in the year by a cargo ship collision. Beyond immediate disaster response, the bill also earmarks $21 billion in economic assistance for farmers impacted by various calamities, a critical measure to support the agricultural sector.
The expansive bill also delves into a variety of other policy areas, including literacy programs, mental health initiatives, regulations concerning hotel fees and ticket prices, and even provisions related to blockchain technology. A notable inclusion is the transfer of jurisdiction over the Robert F. Kennedy Memorial Stadium Campus site from the federal government to the city of Washington, D.C. This 99-year lease transfer paves the way for potential negotiations between the city and the Washington Commanders football team regarding a new stadium, as the team’s current lease at FedEx Field expires in 2027. The bill, however, notably omits any adjustments to IRS funding, leaving the agency facing a potential $20 billion funding cut if 2024 levels are maintained.
Tucked within the dense legislation is a provision delaying the implementation of beneficial ownership information (BOI) reporting requirements under the Corporate Transparency Act (CTA). This act, enacted to combat illicit financial activities by enhancing transparency in corporate structures, mandates the reporting of detailed ownership information to the Financial Crimes Enforcement Network (FinCEN). The delay provides temporary relief for businesses struggling to comply with the complex regulations and has been met with approval from organizations like the National Small Business Association (NSBA), which has actively opposed the CTA, citing confusion and concern among small business owners. The NSBA is currently pursuing a legal challenge to the CTA’s constitutionality.
The delay in BOI reporting comes amidst ongoing legal battles challenging the CTA’s constitutionality. A federal judge in Alabama ruled the act unconstitutional in March 2024, a decision currently under appeal. Separately, a judge in Texas issued a preliminary injunction blocking enforcement of the reporting requirements nationwide in a case brought by the National Federation of Independent Business (NFIB). This legal uncertainty has created confusion for businesses and advisors, and the Congressional delay offers a respite while the courts grapple with the legal challenges. The proposed amendment shifts the reporting deadline for existing entities to January 1, 2026, providing more time for compliance.
The proposed spending bill, devoid of any spending offsets, relies entirely on new spending. Entitlement programs such as Social Security and Medicare are not addressed in the bill, as their funding mechanisms are automatic and not subject to annual appropriations. With a slim majority in the House, Republicans will need Democratic support to pass the bill, and House Speaker Mike Johnson expresses confidence in securing the necessary votes. The timing of the vote remains undetermined, but the looming deadline adds pressure to the legislative process. The comprehensive nature of the bill, addressing a multitude of issues ranging from disaster relief to corporate transparency, reflects the complex and often contentious nature of budgetary negotiations in Congress.
