On June 1 the Senate passed the Fiscal Responsibility Act of 2023 (H.R. 3746) by a vote of 63-36, following House passage on May 31 in a 314-117 vote. The bill would avoid a catastrophic default on the country’s finances by suspending the borrowing limit through Jan. 1, 2025, while imposing cuts to future federal spending. The legislation was drafted following a deal brokered between President Joe Biden and House Speaker Kevin McCarthy (R-Calif.) that was announced on May 28.
The legislation also includes topline discretionary spending levels for fiscal years (FY) 2024 and 2025, including $637 billion for most nondefense discretionary spending programs in FY 2024, approximately a $1 billion decrease below the current FY 2023 level. The legislation would also rescind billions in unobligated balances of specific funding provided in COVID-19 relief legislation in the 116th Congress as well as from programs in the American Rescue Plan of 2021 (P.L. 117-2). The package does not include Medicaid work requirements that had been part of earlier negotiations but would impose new temporary requirements for other assistance programs.
President Joe Biden is expected to sign the measure before the anticipated deadline for default of June 5, as outlined previously by Treasury Secretary Janet Yellen.