Federal Budget Appropriations Update: Looking ahead at 2025

Photo by Samuel Schroth on Unsplash.

While the 119th Congress has officially begun, the landscape is still shaking out in terms of priorities for the new House and Senate education committees. At least one, if not two, budget reconciliation bills are taking shape, extending tax credits and cutting some mandatory spending. The continuing resolution that funds Fiscal Year (FY) 2025 spending at last year’s levels through March 14, 2025, will need to be addressed this spring, and the President’s FY 2026 budget proposal could come in March as well, kicking off Congress’ FY 2026 appropriations process. Below we explore these three distinct funding-related packages that all could move simultaneously.

Budget reconciliation and tax policy package    

House and Senate leadership and the House and Senate Budget Committees are currently working on a budget resolution for FY 2025 which would provide instructions to several authorizing committees, including the House Education and Workforce Committee and the Senate Health, Education, Labor and Pensions Committee. This is the first step in a budget reconciliation process which will be used to extend the 2017 tax cuts as well as make mandatory spending cuts to offset the cost of those tax cuts. Budget reconciliation is being used as the vehicle for this legislation in part because it requires a simple majority to pass in the Senate, versus 60 votes. Mandatory spending for programs like federal financial aid and several student loan programs, including the Public Student Loan Forgiveness program, could be cut or modified. In mid-January, House Ways and Means Committee Chair Jodey Arrington (R-Texas) released a list of possible reconciliation options, which included more than $1 trillion in cuts to the Supplemental Nutrition Assistance Program (SNAP), and $12 billion in cuts to Community Eligibility and access to free and reduced-price school lunch and breakfast. Discretionary funding, which is spent on grant programs like the 21st Century Community Learning Centers (21^st CCLC) and the majority of Child Care Development Block Grant (CCDBG) funding, would likely not be affected.

Furthermore, an expensive reconciliation package could reduce overall funding that would otherwise be available for annual appropriations bills. Tax credits including the Child Tax Credit, which parents have used to reduce the cost of afterschool and other services and programs, could be included in the reconciliation package as well. The timeline laid out for budget reconciliation by House Speaker Johnson is ambitious, with a schedule aiming for the package to be signed into law by mid-April.

Get updates about education and afterschool policy

FY 2025 Appropriations

With the passing of a new continuing resolution in December, the federal government is funded until March 14, 2025. Disagreements over topline spending levels have prevented the development of a final spending bill, however, House and Senate Appropriation Committee leadership met recently to determine bipartisan spending levels, with a goal of having funding levels for all appropriations subcommittees by the end of January. With membership of the House and Senate Appropriations Committees now confirmed for the 119th Congress, advocates can reach out to Members about the importance of federal investments in education, afterschool, summer learning, and school-age care programs. In particular, we look forward to sharing the new brief that outlines how afterschool programs can help counter chronic absenteeism and help students become more engaged in school.

FY 2026 Appropriations

While Administrations typically aim for early February to present their proposed budget to Congress, in a year following an election that timeframe is often pushed back. We anticipate the Trump Administration submitting a proposed budget for FY 2026 in March at the earliest. This will likely be a ‘skinny’ budget that outlines priorities and proposed spending cuts. The House and Senate Appropriations Committees will hopefully have finished the FY 2025 spending process by then and will  begin the FY 2026 appropriations cycle. That means there will be another opportunity in late Spring and Summer to weigh in with Representatives and Senators about the impact that afterschool and summer learning programs have in local communities.

Many questions abound about the three packages outlined above, and timing as well as proposed policy and funding changes are fluid. We look forward to keeping you up to date and encourage you to reach out to your elected officials, particularly next month during the We Love Afterschool campaign.