The House and Senate return to session this week facing a looming government funding deadline of January 30, the now-expired ACA Enhanced Premium Tax Credit (PTC), and intense Member interest in the Administration’s policy towards Venezuela following the President’s decision over the weekend to forcibly extradite Nicolas Maduro. Below is an outline of what to expect on the Senate and House floors during the immediate work period, as well as those items being negotiated off the floor. As always, please let us know if you have any questions.
House of Representatives
The House reconvenes for the second session of the 119th Congress tomorrow. Prior to first votes, House Republicans will hold an off-campus all-day retreat to discuss the legislative agenda for 2026 and potential ideas for a second reconciliation package. President Trump is scheduled to address the GOP Conference, in addition to House Leadership and a number of committee chairs. We will provide a readout of after Tuesday’s retreat of any noteworthy policy developments and/or remarks.
ACA Subsidies. On Wednesday, the House will address the Democratic discharge petition that provides for a three-year clean extension of the ACA PTC, which received the requisite 218 signatures prior to the recess. Assuming full attendance and that no Members have changed their views over the break, the Democrats’ bill is expected to pass. Next steps remain uncertain in the Senate, however, as noted below.
Presidential Veto Overrides. On Thursday, the House will take up two veto override votes on measures the President vetoed over the recess: H.R. 131 and H.R. 504. Both bills had been previously voice-voted in the House, and should they receive 2/3rds support on a recorded vote, they will proceed to the Senate where 2/3rds support will again be required to override the President’s veto.
Appropriations. At the end of the week, the House will consider a pre-conferenced minibus appropriations package consisting of the FY26 Energy and Water, Commerce, Justice, and Science (CJS), and Interior Appropriations bills (see text here). Consideration will be under a closed rule and treated as though the three-bill package were a conference report. Leadership hopes this package will build momentum for additional minibus packages throughout the remainder of the month and ahead of the January 30 government funding deadline.
Assuming this package passes, the next most likely tranche of bills from House Leadership’s perspective would include Financial Services (FSGG), Transportation, Housing, and Urban Development (THUD), and potentially State and Foreign Ops (SFOPS), though this weekend’s military incursion in Venezuela could complicate the latter of these.
Finally, the Defense, Labor, Health and Human Services (Labor-HHS), and Homeland Security bills are shaping up to be the most difficult on which to reach a bipartisan and bicameral agreement. Any FY26 bills that are not enacted through the regular order process are expected to be extended through September 30 at a continuing resolution level.
Senate
The Senate will be in session for the first two weeks of January, followed by a one-week recess before returning to session the last week of the month.
This evening at 5:30pm, the Senate will confirm Keith Bass, Assistant Secretary of Defense. The Senate is also scheduled to confirm the following nominees early in the week:
- Joshua Simmons, to be General Counsel of the CIA
- Alexander C. Van Hook, to be United States District Judge for the Western District of Louisiana
- Sara Bailey, to be Director of National Drug Control Policy
In addition, the Senate will consider three privileged resolutions this work period, all three of which are expected to fail:
- Kaine-Paul War Powers Act Resolution to block the use of U.S. Armed Forces to engage in hostilities within or against Venezuela unless authorized by Congress (S.J.Res.90)
- Warner CMS/ACA Market Integrity Affordability CRA (S.J.Res.84)
- Whitehouse EPA Florida Clean Air Act Plan Approval CRA (S.J.Res.65)
Throughout the month, the Senate will continue to work through the nine remaining Fiscal Year (FY) 2026 appropriations bills that are operating under the existing continuing resolution (CR). Before the holiday break, the Senate nearly began consideration of a five-bill appropriations package that included Defense, CJS, Interior, Labor-HHS, and Transportation-HUD under a draft agreement that would have allowed consideration of some 25 amendments before passage of the combined package (more information here). However, the proffered unanimous consent request ran into several Democratic holds:
- Senator Blumenthal reportedly wanted a vote on the Major Richard Star Act, which allows combat-injured veterans to receive both disability benefits and full retirement pay.
- Senators Bennet and Hickenlooper wanted the bill to include full funding for the National Center for Atmospheric Research based in Colorado, which has been targeted for closure by the Trump Administration (they were offered an amendment vote but refused).
Given the House’s breaking plan to move forward on a 3-bill package (instead of the broader 5-bill package sought by the Senate), Leadership will need to decide the best path forward as the week begins.
In addition to floor activity, bipartisan discussions will continue regarding the now-expired enhanced ACA tax credit, with Senators Collins and Moreno working to expand support for their proposal which would extend the policy for two years with new limitations. However, lack of GOP consensus on both sides of the Capitol, and within the White House, continues to make an extension unlikely to be enacted into law.
Senate Committees will also begin work on further nominations, including those returned to the White House at the conclusion of the first session of the 119th Congress who will all have to be renominated and approved through Committees again. In addition, various additional legislative discussions will continue with an eye towards having legislation ready for the floor in the coming months, including those within the Banking and Agriculture Committees relating to digital asset regulation (market structure) reform and possibly further action on the ROAD to Housing Act.
OUTLOOK/ANALYSIS. January will be primarily focused on picking back up on those items left unfinished in December, namely appropriations and the expired ACA subsidies. We remain optimistic that additional full-year funding bills will be enacted prior to January 30, with a full-year CR still needed for the most contentious bills. The chances of a shutdown remain low, though intra-party disagreements as well as partisan rancor are worth watching, particularly in light of the Administration’s actions in Venezuela.
Off the floor, we expect further progress on two bipartisan efforts: comprehensive housing reform and digital asset market structure policy. While the timeline for these efforts is unclear, we do view both as lawmaking exercises and likely to be enacted within the first two quarters of the year.
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