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The continuing resolution (CR) that the federal government and Department of Defense (DOD) currently operate under will expire on Friday, March 14. Unless Congress passes full-year appropriations for fiscal year (FY) 2025 or another CR by that date, a government shutdown will occur. On Tuesday, the House passed H.R. 1968 that would extend the CR through the end of the fiscal year in largely a party-line vote opposed by Democrats. Passage in the Senate requires 60 votes for cloture, and thus bipartisan support, but on Wednesday afternoon, Senate Minority Leader Chuck Schumer (D-NY) announced that his caucus opposed the measure and was “unified on a clean April 11 CR” to provide Congress additional time to negotiate full-year appropriations bills. However, House Speaker Mike Johnson (R-LA) adjourned the chamber to allow representatives to return to their districts and pressure the Senate into passing the bill.
As the federal government and DOD inch closer to a shutdown that would begin on Saturday at midnight barring further congressional action, below are four questions on defense funding in FY 2025 and the impact of a potential government shutdown.
Q1: What’s the current status of defense funding in FY 2025?
A1: DOD and the rest of the federal government have operated under a CR at FY 2024 spending levels since the start of the 2025 fiscal year on October 1, 2024. In December, Congress extended the CR, which initially lasted through December 20 until March 14. If Congress fails to extend it or pass full-year appropriations, the government will shut down when the CR expires.
While appropriators in both parties have reportedly made progress in determining topline funding levels for defense and nondefense programs, negotiations stalled over Democrats’ efforts to include language explicitly guaranteeing that the executive branch will spend funding appropriated by Congress. These stem from the Trump administration’s directives to stop spending and cancel federal contracts, which challenge the Impoundment Control Act of 1974 that mandates the president may not “defer” or “rescind” funds appropriated by Congress except under limited circumstances. Those circumstances do not include policy disagreements with Congress.
Q2: What options have been presented to prevent a government shutdown?
A2: With the backing of the White House, Speaker Johnson proposed a CR in H.R. 1968 that would last through the rest of the fiscal year ending September 30, 2025. DOD has never operated for a complete fiscal year under a CR, which typically extends funding for programs at the level appropriated in the previous fiscal year and does not fund “new start” programs for the department. Figure 1 below shows the delays in defense appropriations since the government fiscal year shifted to a start date of October 1 in FY 1977. Despite these delays, Congress has always passed full-year appropriations for defense. CRs may also sometimes include “anomalies” that provide “exceptions to the duration, amount, or purposes for which those funds may be used.”
Despite Johnson’s insistence that the CR is “clean,” meaning it simply extends FY 2024 spending levels, the bill makes significant changes and would not have the practical effect of a full-year CR on defense. In addition to cutting funding for nondefense programs, it includes an increase in defense spending by approximately $6 billion, specifies funding amounts for military appropriation accounts above or below FY 2024 levels, and provides DOD with unique provisions and significant flexibility to allocate and spend funding. While it boosts defense funding, the total $892.5 billion allocated for national defense still falls short of the $895.2 billion discretionary topline requested for FY 2025 by the Biden administration.
Prior to the passage of H.R. 1968 in the House, Democratic appropriators introduced an alternative short-term CR through April 11 in S. 924 that would allow both parties additional time to finalize full-year appropriations for FY 2025. That bill also includes funds for shipbuilding programs.
Senate Democrats may reportedly seek to vote on that proposal as an amendment to the full-year CR under consideration in order to voice their opposition while avoiding the damaging effects of a government shutdown. Democrats are also concerned that a shutdown may provide the Trump administration an opportunity to end some federal programs as it would determine which government employees remain essential. However, any changes in the legislation or other bills passed in the Senate would require House lawmakers to return from their districts and approve them.
Q3: What would happen to DOD and defense activities in the event of a government shutdown?
A3: In the event of a shutdown, DOD would continue to perform essential operations to “defend the nation and conduct ongoing military operations” in addition to other “excepted” activities that are “necessary for the safety of human life and the protection of property.” The military department secretaries and heads of DOD components, including the combatant commanders, determine which activities are excepted while the secretary of defense may except additional activities. DOD provided examples of excepted activities in their biennial shutdown planning guidance last released in November 2023.
Defense activities funded in accounts where “budgetary resources that have not lapsed” and remain available over multiple fiscal years (including procurement; research, development, test and evaluation; and military construction) may continue, per guidance from DOD. Any activities not considered excepted that are funded out of accounts where funds have lapsed must cease.
Active-duty military personnel must continue to report and carry out assigned duties, including excepted activities and non-excepted tasks provided they can be conducted without any additional costs. However, military personnel will not receive pay during a government shutdown. Congress could choose to pass legislation to pay servicemembers during a shutdown as it did in 2013.
Civilian personnel who carry out excepted activities must also continue to work without being paid, while those who do not support excepted activities will be furloughed. Civilians performing work in accounts with budgetary resources that have not lapsed may not be furloughed. DOD’s 2023 guidance estimated that in a shutdown the department would retain approximately 167,000 civilian employees whose compensation is not financed by annual appropriations and nearly 200,000 who are “necessary to protect life and property” out of a total civilian workforce of just over 800,000 at the time. All government employees will automatically receive back pay following the end of a shutdown based on the terms of the Government Employee Fair Treatment Act of 2019.
However, planning for a shutdown is “disruptive” as DOD leaders and staff must take time to identify which activities can continue, communicate that to the workforce, and notify civilian employees who are being furloughed that would otherwise be spent carrying out defense activities and the overall management of the department.
Q4: When did DOD last experience a government shutdown?
A4: DOD was in shutdown for 16 days to start FY 2014 in October 2013. Prior to the shutdown, Congress passed the Pay Our Military Act to ensure that active-duty servicemembers and DOD and Department of Homeland Security civilian employees who “[provide] support to members of the Armed Forces” would be paid during that period. Approximately 350,000–400,000 civilian employees of DOD were furloughed starting October 1, 2013, but the majority of those personnel returned to work on October 7, 2013. According to then-DOD Comptroller Robert Hale, while “wartime activities were fully supported,” the furloughs were “absolutely” harmful to DOD’s mission. A White House report issued after the shutdown stated that civilian and military employees “spent thousands of hours developing and implementing plans for managing a shutdown, implementing the Pay Our Military Act, and restarting full operations.”
Seamus P. Daniels is a fellow for Defense Budget Analysis in the Defense and Security Department at the Center for Strategic and International Studies in Washington, D.C.
