Congressional leaders have reached a $1.59 trillion deal on top-line spending in a race to avoid a potential government shutdown. The deal establishes an overall spending budget of $1.59 trillion for the 2024 fiscal year, with $886 billion allocated to military spending and $704 billion for non-defense spending, according to Republican House Speaker Mike Johnson of Louisiana.

After weeks of dialogue and debate, the deal has secured hard-fought concessions to unlock the FY 24 topline numbers, allowing the Appropriations Committee to begin negotiating and completing the twelve annual appropriations bills, as stated by Speaker Johnson. The agreement sets a path towards a potential funding decision and signals cooperation between Johnson and Senate Majority Leader Chuck Schumer.

The House and Senate are nearing a crucial Jan. 19 deadline, when funding runs out for many federal agencies. Funding for the rest of the government expires on Feb. 2. While the deal paves the way for a potential funding decision, the possibility of a shutdown remains as parties continue to clash over key policy issues.

Not all parties are satisfied with the spending levels of the deal, as acknowledged by Speaker Johnson. However, the deal offers a way to move the process forward, reprioritize funding towards conservative objectives, and fight for important policy riders included in House FY24 bills. Concessions include a $10-billion cut to IRS mandatory funding and a $6.1 billion reduction of the “COVID-era slush funds”.

Senate Majority Leader Chuck Schumer and House Minority Leader Hakeem Jeffries wrote in a Sunday letter that the framework agreement allows appropriators to address major challenges faced by America at home and abroad. They also emphasized the importance of preserving the investments for hardworking American families secured by the legislative achievements of President Biden and Congressional Democrats.

Speaker Johnson faces his first major test of governing as speaker, after a historically unproductive year during which the GOP-controlled House passed just 27 bills that became laws. The absence of Louisiana Republican House Majority Leader Steve Scalise and the departure of Johnson’s predecessor, Former House Speaker Kevin McCarthy, means House Republicans will require Democratic votes to pass government spending bills. Hardline members of the caucus are expected to oppose anything that does not contain drastic cuts.

In a released statement, President Joe Biden expressed approval of the deal and the progress it makes toward averting a shutdown, while considering funding levels negotiated last year. He called on congressional Republicans to fulfill their responsibility to fund critical domestic and national security priorities, including his supplemental request.