Fiscal Year 2026 Financial Services and General Government Bill

House Subcommittee on Financial Services and General Government

2025-07-21

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Source: Congress.gov

Summary

This meeting of the Financial Services and General Government Subcommittee convened for the markup of the Fiscal Year 2026 appropriations bill, which proposes significant spending cuts across various federal agencies and includes numerous policy riders[ 00:15:50-00:16:26 ] . While proponents emphasized fiscal responsibility and national security, opponents criticized the bill as partisan, detrimental to essential services, and undermining the constitutional role of Congress in appropriations[ 00:16:08-00:16:22 ] . The bill ultimately passed out of subcommittee along party lines with a vote of nine ayes to six noes.

Themes

Fiscal Responsibility and Spending Priorities

The bill's proponents highlighted its focus on fiscal responsibility, national security, and leveraging new technology[ 00:16:08-00:16:15 ] . They detailed significant budget reductions, including a 20.4% cut to the Department of the Treasury, a 3.4% cut to the Executive Office of the President, and a 34% reduction for independent agencies such as the SEC, FTC, FCC, and SBA[ 00:16:37-00:16:42 ] [ 00:17:09-00:17:19 ] [ 00:19:00 ]

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. Specific allocations were made for areas like the Committee on Foreign Investment in the United States, counter-terrorism finance, and judicial security, with particular emphasis on strengthening cybersecurity and IT modernization efforts across the federal government[ 00:16:54 ] [ 00:17:56-00:18:17 ]

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[ 00:27:56 ]

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. The bill also included provisions to eliminate waste, prevent improper payments, and codify executive orders issued by President Trump.

IRS Funding and Tax Enforcement

A major point of contention was the proposed cut to the Internal Revenue Service (IRS). Opponents criticized the bill's 23% overall reduction for the IRS, which included a 45% cut to its enforcement budget, arguing it would enable wealthy individuals and corporations to evade taxes. They cited studies indicating that every dollar invested in IRS enforcement yields significant returns in revenue, particularly from high-income earners. Concerns were also raised about the impact on customer service for ordinary taxpayers. Proponents implicitly supported these cuts as part of fiscal responsibility, while opponents labeled them as "tax cuts for tax cheats".

Impact on Federal Agencies and Services

The bill proposed cuts to several agencies vital for public services and economic stability. These included reductions for the Federal Trade Commission (FTC), Small Business Administration (SBA), and Consumer Product Safety Commission (CPSC)[ 00:40:27 ]

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. Opponents warned that these cuts would weaken consumer protections, hinder support for small businesses, and potentially lead to unsafe products in the market. Additionally, funding for the Election Assistance Commission was cut by 40%, raising concerns about election security. The bill also maintained a pay freeze for civilian federal workers, which was criticized for undermining their morale and pay parity with military counterparts.

Integrity of the Appropriations Process

Several members, particularly on the Democratic side, expressed deep frustration and disillusionment with the appropriations process itself[ 00:25:15-00:25:17 ]

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. They described it as "broken," "demolished," and a "pro forma ritual" where subcommittees have become "irrelevant". Criticisms were directed at the administration for impounding, withholding, and redirecting funds, which was seen as undermining Congress's constitutional "power of the purse". Some speakers alleged that an unelected OMB Director was orchestrating a "lawless upheaval" and attempting to bypass congressional authority.

Policy Riders and Social Issues

The bill included various "legacy riders" addressing a range of policy issues[ 00:19:04 ]

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. These provisions aimed to reaffirm "pro-life protections," defund "climate rules," prohibit mask and vaccine mandates, and protect "traditional marriage"[ 00:19:08-00:19:17 ]

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. Additionally, some riders impacted the District of Columbia's ability to manage its own affairs, touching upon anti-choice measures, criminal justice, and traffic enforcement. Opponents viewed these as "extreme policy riders" that inserted a "far-right agenda" into a standard government funding bill.

Tone of the Meeting

The tone of the meeting was largely contentious and partisan, reflecting a deep ideological divide between the bill's Republican proponents and Democratic opponents. While the Chairman's opening remarks were informative, detailing the bill's allocations and priorities, subsequent Democratic speakers expressed significant frustration and disillusionment with the legislative process, often describing it as "broken" or a "fantasy Congress"[ 00:16:37-00:19:00 ] [ 00:40:17 ]

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. Despite the strong disagreements and criticisms of the administration, speakers generally maintained a formal and respectful parliamentary demeanor, addressing each other as "Mr. Chairman" or "Ranking Member"[ 00:25:06 ]

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[ 00:25:48 ]

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. There was also an underlying sense of resignation from some members regarding the perceived futility of the process.

Participants

Transcript

Now it's on.
Okay.
allocation.  This number includes the disaster funding we provide to the Small Business Administration.  In drafting the fiscal year 2026 bill, I focused on three priorities.  Ensuring fiscal responsibility, leveraging new technology, and strengthening national security.  These are priorities on which members on both sides of the aisle should agree and support.  I take a moment to briefly describe the bill title by title.   Title I funds the Department of the Treasury at 11.3 billion.  This is 20.4% lower than the fiscal year 2025 enacted levels and 5.8% less than the bill we reported out of the full committee last year.  Within the Department of Treasury, the bill funds the Committee on Foreign Investment in the United States at 21 million, the Office of Terrorism and Financial Intelligence at 230.5 million,   THE COMMUNITY DEVELOPMENT FINANCIAL INSTITUTIONS FUND AT $276.6 MILLION.  TITLE II FUNDS THE EXECUTIVE OFFICE OF THE PRESIDENT OR THE EOP.  FUNDING FOR THE EOP IS CUT BY 3.4% FROM THE FISCAL YEAR 2025 ENACTED LEVELS TO $830 MILLION.  WITHIN THE EOP, THE BILL FUNDS THE OFFICE OF MANAGEMENT AND BUDGET AT $129 MILLION.  OMB IS REMINDED RECEIVED $100 MILLION IN THE RECONCILIATION BILL.   the Information Technology Oversight and Reform Account at $10 million, and the High Intensity Drug Trafficking Area Program within the Office of the National Drug Control Policy at $299 million, and the Drug-Free Communities Program at $136 million.   Title III of the bill funds the federal judiciary.  Like members of Congress, we need to ensure the security of the Supreme Court justices, our federal judges, and the people that work in the federal court system.  The bill provides $18 million for the Supreme Court justices' personal security.   The bill fully funds the court's security at $892 million.
We ensure that the Administrative Office of the United States Courts has the funding and the court system needs to strengthen its cybersecurity and IT modernization efforts.  Moving on to Title IV, we cut federal funding to the District of Columbia by 4.6% from fiscal year 2025 enacted levels to $823 million.   Within this title, we cut $20 million from the emergency planning and security costs in the DC account that were attributable to the inauguration this last January.   However, we ensure the District of Columbia has sufficient funding at $70 million to address the security of public events in our nation's capital during the year 2026 for events like our country's 250th anniversary celebration.  Title V funds are independent agencies.  This includes the SEC, the FTC, the FCC, the GSA, USPS, SBA, and smaller agencies.   Total funding for Title V is approximately $1.5 billion, which is a 34% reduction from the fiscal year 2025 enacted levels.  Finally, the bill continues the important policies that apply across the federal government and the District of Columbia in Titles VI, VII, and VIII.  Most of these provisions are legacy riders which have been around for years, if not decades.  These provisions reaffirm important pro-life protections.   defund the disastrous climate rule, stop the Biden-era divisive social policies, prohibit mask and vaccine mandates, protect traditional marriage, codify the RAINS Act and other critical executive orders issued by President Trump, including eliminating waste and saving taxpayer dollars by consolidating procurement, restoring common sense to federal office space management,   modernizing payments to and from America's bank account, and protecting America's bank account from waste, fraud, and abuse.  As I said in the beginning, I'm proud of the work the subcommittee has accomplished to date, and I would close by encouraging my colleagues on both sides of the aisle to support this important bill, and I yield back.
I now recognize Ranking Member Hoyer for his five minutes of opening remarks.
Thank you very much, Mr. Chairman.  Let me start by making an observation, and I know I sound like a broken record.  We have almost a full committee here, and we have people who have listened to all the testimony.   and have become more knowledgeable on this bill than other members of the Congress of the United States on either side of the aisle.  And the reason for having subcommittees is to accomplish that objective.   As you know, I don't consider this a markup because we don't mark it up.  We don't take actions that would offer amendments on both sides which feel perfect, the chairman's mark.  But that is how it's operated for some time now.  And I really believe that we ought to return to a time when the subcommittees really did work as opposed to waiting for the full committee.   In any event, that's the way it's done.  Last week, OMB Director Russell Vogt said, and I quote, the appropriations process has to be less bipartisan.  That's in the context of the brief discussion the chairman, the big chairman and I had as we closed our last markup.   If it's less bipartisan, it will be less successful.  That's the bottom line.  When we had a four vote majority and you have a four vote majority, you know there's some things you're gonna have to have bipartisan support for and you're not gonna get them done and they need to be done.

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