Congress has not finalized any appropriations bills for Fiscal Year 2023. The current fiscal year ends on September 30. Congress is working on a continuing resolution (CR) that would avert a government shutdown and keep the government funded at current levels. While some have expressed interest in a CR that extends into 2023, the general expectation is a CR would run through December 16, 2022. Congress did not finalize FY 2022 appropriations until March of this year, more than five months into the fiscal year.

We are aware of some obstacles facing the CR. A “clean” CR would simply extend funding and allow lawmakers more time to agree to full funding. However, lawmakers may attempt to add additional provisions, such as an overhaul of federal permitting for energy products. Additionally, the Biden Administration is seeking $47.1 billion in emergency funds to be attached to the CR, including further funding related to Covid-19 and monkeypox relief, aid for Ukraine, and natural disaster relief aid.

We expect the House of Representatives to vote this week on a CR, and we will closely monitor what, if any, provisions are added. For an up-to-date table on the status of appropriations, please click here.

As we reported last month, the Financial Services and General Government bill, which is typically Congress’ vehicle for controlling federal pay, stayed silent on the issue, effectively endorsing President Biden’s proposal for an average 4.6 percent boost in 2023. And in a Wednesday, August 31, letter to Congress, Biden formalized his “alternative pay plan” for the 4.6 percent raise. If implemented, it would provide a 4.1 percent increase to basic pay and an average 0.5 percent boost to locality pay. This would be the largest pay increase in 20 years.

In the letter, Biden wrote, “Federal agencies have witnessed growing recruitment and retention challenges with federal positions experiencing eroded compensation. Multiple years of lower pay raises for federal civilian employees than called for under regular law have resulted in a substantial pay gap for federal employees compared to the private sector. The American people rely on federal agencies being managed and staffed by skilled, talented and engaged employees, including those possessing critical skills sets, which requires keeping federal pay competitive.”