Legislative Update: Shutdown Looms as Trump Rejects GOP-Democratic Funding Compromise

Shutdown Looms as Trump Rejects GOP-Democratic Funding Compromise

House Speaker Mike Johnson’s (R-LA) proposed stopgap funding measure to keep the government running through March 14 quickly collapsed amid mounting opposition from House conservatives and turned into a barrage of criticism. Unveiled just hours earlier, President-elect Trump’s vocal opposition and Elon Musk’s influence intensified the political fallout. Musk, a prominent Trump ally, repeatedly criticized the negotiated bipartisan CR in posts on X (formally Twitter) and urged voters to unseat lawmakers supporting it, further pressuring GOP leadership.  Donald Trump delivered the final blow on December 18, telling Fox News late Wednesday that he was “totally against” the continuing resolution (CR), which included $100 billion in disaster aid, $10 billion for farmers, and various health care and trade provisions, as well as long-awaited funding for new EPA programs to bolster data on recycling and provide grants for recycling infrastructure.

In a statement with Vice-President Elect J.D. Vance, Trump demanded GOP members to instead pass a “clean CR” that includes a debt-limit increase, a measure not previously under discussion by GOP leadership. The rapid unraveling of Johnson’s plan leaves Congress scrambling for alternatives to avert a government shutdown.  With funding expiring on December 20 and no clear path forward, Johnson faces a precarious political future as Republicans scramble for a solution that aligns with Trump’s demands while avoiding blame for the impending crisis.

Johnson and Majority Leader Steve Scalise (R-LA) canceled the vote on the bill and are exploring alternatives, including a three-month funding bill paired with disaster aid, 1-year extension on the Farm Bill, and aid to farmers.  There are some reports that they may delay the debt ceiling fight for 2 years, and others suggest that they may eliminate it altogether.  Last night, there were comments that there may need to be a short-term extension to buy more negotiation time, but as of this morning, there has been no indication of the route the GOP leadership will take.

Meanwhile, top Democrats, including House Minority Leader Hakeem Jeffries (D-NY), on Wednesday rejected any attempt to dissolve the bipartisan agreement, putting the burden squarely on Republicans to resolve the impasse. With Democrats holding firm and no clear consensus among Republicans, Johnson faces significant hurdles to advancing a funding solution before the government shuts down on Friday, December 20.

Under the House’s 72-hour review rule, the earliest a final vote can occur Friday night, pushing a Senate vote to late that evening or early Saturday.  If Congress does not pass the bill by Friday night, a government shutdown will occur. Given substantial Republican opposition, heightened by Musk’s influence, Speaker Johnson may need to rely on a process known as suspension, which requires a two-thirds majority in the House. This strategy would necessitate significant support from Democrats to prevent a shutdown.

This situation provides a preview of how difficult it will be to navigate a slim House GOP majority, even with unified government control, especially when coming to an agreement on all 12 funding bills early next year.

Johnson’s leadership post is also in peril.  Already under pressure from the House Freedom Caucus, Johnson now faces mounting internal criticism over the continuing resolution’s concessions to Democrats. This has led dissenters like Rep. Thomas Massie (R-KY) to withhold their support for Johnson in the upcoming January 3 speaker election. Massie indicated that other members share his stance, leaving Johnson potentially short of the Republican votes needed to retain his position. This raises the prospect of yet another leadership crisis, as the House could be forced to select a new speaker just days before the January 6 certification of the presidential election.

Senate Passes $883.7 Billion NDAA, Sends Defense Bill to Biden

The House and Senate checked-off passing the fiscal 2025 National Defense Authorization Act (NDAA) on their end-of-the-year list.  The House passed the bill on December 11 on a 281-140 vote.  The Senate passed their version on an 85-14 vote, sending the $883.7 billion defense bill to President Joe Biden’s desk for signature. The NDAA’s passage marks significant progress on one of the 118th Congress’ top priorities as it closes out its session, but the cultural and fiscal disputes argued during the passage foreshadow continued debates into the new year.

Senate Approves Major Bipartisan Water Infrastructure Bill, Sends to Biden

The Senate overwhelmingly passed the bipartisan Thomas R. Carper Water Resources Development Act of 2024 (S. 4367) with a 97-1 vote, solidifying Congress’ decade-long commitment to advancing water infrastructure legislation on a two-year cycle. Following the House’s approval last week, the bill now awaits President Biden’s expected signature. The measure authorizes critical projects nationwide, including port and waterway enhancements, flood protection, and ecosystem restoration initiatives. It also includes reforms to the Army Corps of Engineers, focusing on expediting project delivery, enhancing tribal partnerships, and increasing reservoir use for water supply in drought-affected regions of the West. Additionally, the legislation incorporates noncontroversial provisions, such as the Fiscally Responsible Highway Funding Act of 2024 (S. 5235) and the Economic Development Reauthorization Act of 2024 (S. 3891). Chairman Tom Carper (D-DE), the retiring leader of the Senate Environment and Public Works Committee and the bill’s namesake, praised the measure as a vital investment in infrastructure, supply chains, and job creation.

EPA Targets Vinyl Chloride in New Chemical Data Collection Rule

The EPA has finalized a rule under section 8(d) of the Toxic Substances Control Act (TSCA) requiring companies to submit unpublished “health and safety studies” for 16 chemicals, with a particular focus on vinyl chloride. Vinyl chloride is one of five chemicals already undergoing formal prioritization for risk evaluation, alongside others like acetaldehyde and acrylonitrile.

The rule, effective January 13, compels companies to provide data on the chemicals they manufacture, import, or handle, including when the chemicals appear as components in mixtures, products, or even in trace amounts as impurities. Vinyl chloride’s inclusion signals its growing prominence as a target for evaluation, given its importance as a feedstock to produce widely used polymers, namely polyvinyl chloride (PVC)..

The reporting requirement is part of the EPA’s strategy to improve its risk evaluation process, which has previously faced delays due to insufficient data. The agency aims to strengthen its ability to identify and address “unreasonable risks” under TSCA by collecting unpublished studies on chemicals like vinyl chloride.

Industry and the Vinyl Institute have pushed back against the rule, arguing that requiring data on chemicals present as impurities or trace amounts—such as vinyl chloride in specific formulations—creates unnecessary burdens. However, the EPA rejected these arguments, insisting that exhaustive  data is essential for evaluating risks across all conditions of use.

EPA Designates Vinyl Chloride as One of  Five High-Priority Chemicals, Initiates Review of Five More Under TSCA

On December 18, the  U.S. Environmental Protection Agency (EPA) announced the formal designation of five chemicals—including vinyl chloride—as High-Priority Substances (HPS) for risk evaluations under the Toxic Substances Control Act (TSCA). This triggers mandatory, multi-year analyses under TSCA.

The EPA must now conduct risk evaluations for the initial five chemicals within 3.5 years, a timeline the agency has historically struggled to meet. Simultaneously, it has 9-12 months to determine if the next five chemicals—4-tert-Octylphenol, benzene, ethylbenzene, naphthalene, and styrene—pose an unreasonable risk to health or the environment under their conditions of use. Both groups are subject to a new rule requiring submitting previously unpublished health and safety studies. These chemicals, known or probable carcinogens, will undergo a detailed assessment to determine their risks to health and the environment.

This work adds to an already crowded docket of risk evaluations, many bound by court-enforced deadlines. However, the Trump EPA’s expected efforts to roll back Biden-era chemical safety rules and evaluation policies may divert resources, creating a potential conflict. Importantly, TSCA does not permit the EPA to abandon prioritization or risk evaluations once initiated, limiting the incoming administration’s ability to reverse course on these chemical reviews.