Pay Raises, Agency Budgets, and Shutdown Risks: Where FY 2027 Funding Bills Stand
It’s June, and the clock is ticking for the fiscal year (FY) 2027 appropriations process.
The process comes as Congress is simultaneously trying to pass a $72 billion reconciliation package funding immigration enforcement efforts, consuming floor time that would otherwise be available for appropriations work. Plus, there are the midterm elections looming in November.
If the appropriations bills aren’t passed, federal workers face the prospect of another government shutdown or last-minute continuing resolution, after enduring a 43-day shutdown in the fall of 2025, and a 76-day Department of Homeland Security (DHS) shutdown earlier this year.
National Active and Retired Federal Employees (NARFE) Association staff vice president John Hatton told Federal News Network he sees progress on the bills but warns that it could be the same old story come the end of the fiscal year on September 30.
“My best guess is we’re going to come into September and there’s not going to be many bills passed into law. And we’ll look at a continuing resolution to pass the election,” said Hatton.
Appropriations Checkup
Here’s where we stand on the 12 appropriations bills:
The Military Construction, Veterans Affairs, and Related Agencies bill passed the full House on a vote of 400-15. The Senate has yet to act on its version.
Several other bills have passed the committee stage and are pending in the full House:
Agriculture, Rural Development, Food and Drug Administration, and Related Agencies
Commerce, Justice, Science, and Related Agencies
Energy and Water Development, and Related Agencies
Financial Services and General Government
Legislative Branch
State, Foreign Operations, and Related Programs
The following passed the House subcommittee stage:
Interior, Environment, and Related Agencies
Transportation, Housing and Urban Development, and Related Agencies
And the following haven’t been passed at any stage yet:
Defense
Homeland Security
Labor, Health and Human Services, Education, and Related Agencies
Workforce Impact
Included in the House bills are a number of provisions impacting the federal workforce.
The Financial Services and General Government Bill did not include a pay raise for federal civilian employees in 2027, following the Trump administration’s budget proposal which also omitted one. However, nothing is final on this yet as the president must submit his alternative pay plan in August and Congress could still act on a raise.
The Transportation bill cut public transit funding by 22 percent and Amtrak funding by 69 percent.
The Interior, Environment, and Related Agencies bill cut funding for the Environmental Protection Agency (EPA) by $1.8 billion or 20 percent while boosting Interior Department funding by $700 million.
Controversial Bills
The Homeland Security and Labor-HHS-Education bills are expected to face some of the toughest negotiations this year. Immigration enforcement funding, border security initiatives, and health care spending remain major points of contention between lawmakers and the administration.
Another potential flash point is Defense. The administration requested a total of $1.5 trillion in defense spending, up $440 million over current levels, due to the conflict in Iran.
The House Armed Services Committee recently revealed a $1.14 trillion National Defense Authorization Act (NDAA). The extra $350 billion would come from a separate reconciliation bill. The first markup is scheduled for June 4.
