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This Week in DC
The House and Senate are not in session.
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Partial Government Shutdown Affects Department of Homeland Security
On Saturday funding for the Department of Homeland Security (DHS) lapsed, beginning a limited government shutdown affecting the agencies in that department. All other spending bills funding the remaining parts of the federal government have been approved and signed into law. With Congress out of session this week, it is expected the limited shutdown will last at least until next week unless a deal is reached and members are called back sooner. The department’s most recent shutdown plan, updated in September 2025, can be found here. Per that plan, the vast majority of DHS employees would be deemed essential and not furloughed during a lapse in appropriations.
Reconciliation Resources
Following enactment of H.R. 1, the One Big Beautiful Bill Act (OBBBA), a number of resources have been released examining the legislation's impact and providing implementation guidance. Newly released resources are included below.
- The Internal Revenue Service (IRS) issued a notice providing guidance for determining whether electricity-producing qualified facilities, energy storage technologies, or eligible components are receiving material assistance from a prohibited foreign entity (PFE) and would be ineligible for certain energy tax credits. OBBBA added new restrictions to certain clean electricity credits and the advanced manufacturing production credit related to material assistance from a PFE.
Judge Blocks Rescission of Public Health Grants From Cohort of States
According to media reports, last week a federal judge ruled the administration cannot proceed with plans to rescind $602 million in public health grants from four states (California, Colorado, Illinois and Minnesota). The judge granted the plaintiffs’ emergency motion for a temporary restraining order, prohibiting defendants from implementing agency guidance or directives to identify and terminate public health grants awarded to the plaintiffs. The temporary restraining order is in effect for 14 days. This action follows reporting the administration would rescind a total of $1.5 billion in health and transportation funds from the four states.
DOE Announces $175 Million to Modernize Coal Plants
Last Wednesday the Department of Energy (DOE) announced $175 million in funding for six projects to modernize, retrofit, and extend the useful life of coal-fired power plants that serve rural and remote communities. The projects are part of a $525 million effort to expand and reinvigorate the nation’s coal fleet through targeted upgrades. A list of the selected projects can be found here. The announcement notes DOE plans to make additional selections at a later date.
EPA Finalizes Rule Rescinding Endangerment Finding
On Thursday the Environmental Protection Agency (EPA) released a final rule rescinding the 2009 Endangerment Finding. In its review for the rule, EPA concluded that the Clean Air Act (CAA) does not provide statutory authority for the agency to prescribe motor vehicle and engine emission standards in the manner previously utilized, including for the purpose of addressing climate change, and therefore has no legal basis for the Endangerment Finding and resulting regulations. The announcement notes the action is only related to greenhouse gas emissions and does not affect regulations that combat criteria pollutants and air toxics. Additional information can be found here.
DOI Launches Materials Access Program for Community Pits
On Thursday the Department of the Interior (DOI) announced the Materials Access Program, intended to reduce the regulatory burden for Americans to access mineral materials such as sand, gravel and stone. The program and policy change will make it easier and more affordable for the public to obtain common materials used in construction and community development; a new online mapping will also launch to direct citizens to the pit nearest them. The policy standardizes procedures for noncompetitive mineral materials sales and establishes two pricing tiers for purchases. State and field offices will apply the new procedures on lands identified in resource management plans as open to mineral materials disposal, consistent with existing regulations.
DOL Announces AI Literacy Framework for Workforce Programs
Last Friday the Department of Labor (DOL) published a framework for artificial intelligence (AI) literacy to provide a foundation to guide nationwide AI literacy efforts across workforce and education systems. The framework outlines five foundational content areas: Understand AI Principles, Explore AI Uses, Direct AI Effectively, Evaluate AI Outputs, and Use AI Responsibly. The release follows the department’s recent guidance promoting the use of Workforce Innovation and Opportunity Act (WIOA) funding and governor’s reserve monies to help participants develop AI skills. DOL encourages the public workforce and education systems to expand AI education and training opportunities and to utilize the framework as a resource for program design.
DOT Finalizes Rule on State Issuance of CDLs
On Wednesday the Department of Transportation (DOT) issued a final rule amending the federal regulations for State Driver’s Licensing Agencies issuing commercial driving licenses (CDLs) to non-domiciled individuals. The final rule limits eligibility to certain nonimmigrant status holders, eliminates the Employment Authorization Document (EAD) as an accepted proof of eligibility, and requires states to query the Systematic Alien Verification for Entitlements (SAVE) system to confirm every applicant’s lawful immigration status. In June, the department announced a nationwide audit of states issuing non-domiciled CDL’s. The final rule is effective 30 days after its publication in the Federal Register.
NTIA Holds Listening Sessions on Use of BEAD Savings
Last week the National Telecommunications and Information Administration (NTIA) held a closed-door listening session with state and territory broadband offices and held a public listening session, both focused on how to effectively invest the remaining Broadband Equity Access and Deployment (BEAD) program funds. According to NTIA, common themes for using the savings included enhancing public safety, streamlining state and local permitting processes, addressing excessive screen and internet use in the classroom, increasing broadband resiliency and redundancy, modernizing the Air Traffic Control system, and utilizing a portion of the savings as a reserve fund. NTIA recently announced it has approved 50 out of 56 final proposals from states and territories; the BEAD Progress Dashboard can be found here.
Treasury Updates Data for Pandemic Relief Programs
The Treasury Department updated public data for two COVID-19 pandemic relief programs. The public data dashboard for the State and Local Fiscal Recovery Funds (SLFRF) program was updated through October 2025. Quarterly compliance data for the Homeowner Assistance Fund (HAF) through the third quarter of 2025 was also released.
GAO Releases Report on SLFRF Spending
Last week the U.S. Government Accountability Office (GAO) released a report, States’ and Localities’ Fiscal Recovery Funds Spending Update for 2025. As of March 31, 2025, states reported spending $156.3 billion, or 80 percent of their funds while localities reported spending $107.2 billion, or 84 percent. Recipients have until December 31, 2026 to spend the funds.
CBO Issues Report on Fiscal Outlook, Higher Federal Deficits Projected
Last week the Congressional Budget Office (CBO) released The Budget and Economic Outlook: 2026 to 2036. Per the report, the federal deficit totals $1.9 trillion in fiscal year 2026 and grows to $3.1 trillion in 2036. Relative to the size of the economy, the deficit is 5.8 percent of gross domestic product (GDP) in 2026 and increases to 6.7 percent in 2036. Outlays are large by historical standards and growing, totaling 23.3 percent of GDP in 2026 and projected at 24.4 percent in 2036. Revenues in 2026 total 17.5 percent of GDP and are projected to stay at or slightly above that level through 2036. Looking at outlays in Medicaid, the report estimates federal outlays are estimated to total $708 billion in 2026 (an increase of about 6 percent over 2025); slower growth is projected for 2027 to 2029, mainly driven by provisions in the One Big Beautiful Bill Act (OBBBA) and then growth increases from 2030 to 2036, mainly driven by an increase in costs per enrollee, number of enrollees aged 65 or older, and number of people whose enrollment is related to a disability.
House Agriculture Committee Unveils Farm Bill
Last week the Chairman of the House Agriculture Committee, Glenn “GT” Thompson (R-PA), introduced the Farm, Food, and National Security Act of 2026 (Farm Bill). Bill titles cover commodities, conservation, trade, nutrition, credit, rural development, research/extension, forestry, energy, horticulture/marketing, crop insurance, and miscellaneous. Under the nutrition title (Title IV), the bill includes language mandating the U.S. Department of Agriculture (USDA) make the Supplemental Nutrition Assistance Program (SNAP) Online Purchasing Pilot a permanent shopping option nationwide. The title also has language that ensures states can transition swiftly to chip-enabled SNAP EBT cards and requires the U.S. Government Accountability Office (GAO) to investigate SNAP administrative costs in states. The committee also includes an overview of agricultural provisions included in the One Big Beautiful Bill Act (OBBBA). Additional resources and summaries can be found here.
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