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Senate Majority Leader Chuck Schumer and House Speaker Mike Johnson

The latest on funding and border talks

Topline spending update: The House and Senate have yet to reach an agreement on a topline spending figure for FY2024, even as the first funding deadline hits in a few weeks.

And we’re told that House GOP leaders are making new demands as part of the ongoing talks.

Welcome to the second session of the 118th Congress. Same as it ever was.

House Republicans want to accelerate IRS funding cuts from FY2025 to FY2024 ($10 billion in each year). Remember, these cuts were agreed to as part of the bipartisan debt-limit deal, the Fiscal Responsibility Act.

House GOP leaders also want to rescind previously allocated Covid response funds.

None of this is particularly surprising, but it’s a new wrinkle. There hasn’t been a lot of progress over the last couple of weeks. And conservative House Republicans back the across-the-board spending cuts mandated under the FRA if there’s no deal.

Because Congress doesn’t have a deal in place by Jan. 1 – today – the Pentagon’s budget is temporarily set to $850 billion while non-defense spending is $739 billion. This is the $1.59 trillion total you hear being talked about. OMB will have to figure out how much needs to be cut to align with this limit, although there is no sequestration yet.

Democrats — as well as Senate GOP appropriators — are holding firm that the topline figure should be in line with the FRA, as well as the side-deal hammered out by Sens. Patty Murray (D-Wash.) and Susan Collins (R-Maine), chair and vice chair of the Senate Appropriations Committee. There’s also $14 billion in emergency spending, $8 billion of which would be for the Pentagon, that was agreed to on top of the FRA.

The framework under discussion wouldn’t include any agreement on “poison-pill” amendments — politically charged provisions that often tank spending bills.

Before the break, Collins reiterated that the topline should be the Fiscal Responsibility Act numbers plus the side-deal, “following the Senate’s lead.”

Collins sought to blunt criticism from the right that the Senate’s approach is too heavy-handed on spending, noting that the non-defense bills approved by the Senate Appropriations panel are less than a 1% increase from the prior year. The 4.2% defense increase is “very much needed” given the threat landscape worldwide, Collins added.

Speaker Mike Johnson’s office didn’t reply to multiple requests for comment. But this framework was confirmed by multiple sources in the Biden administration, House and Senate Democrats and GOP leadership in both chambers.

Border talks update: If the government funding morass weren’t complicated enough, it’s becoming increasingly likely that Congress may have to pair it with the border security and foreign aid package that’s still being negotiated.

With just a handful of legislative days remaining before the first Jan. 19 government-funding deadline — and another two weeks until the Feb. 2 deadline — finding floor time in the Senate for all of this will be close to impossible.

We’re told that negotiators from the Senate, White House and Homeland Security Department, including the principals, met virtually several times over the holiday break. Separately, Johnson is heading to the border this week.

Negotiators reported steady progress — surprise! — but not much else. They’ll continue to meet this week, though the Senate isn’t back in session until next Monday.

Au Revoir, Kevin: Kevin McCarthy’s last day in Congress was Sunday. There are now 220 Republicans in the House, 213 Democrats and two vacancies. The California Republican was the third shortest-serving speaker of the House in U.S. history, holding the gavel for just 270 days.

McCarthy has a ton of political cash that he can spend on practically anything besides directly enriching himself. His Majority Committee PAC, or MC PAC, has $4 million on hand, while his reelection campaign committee – McCarthy for Congress – has $10.6 million. McCarthy may have to give some money back to donors but expect this kitty will help fund his political operation going forward.

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