Congressional Update
With the start of the new year, Congress will begin work on a packed legislative schedule. To avoid a partial government shutdown by the January 30, deadline, Congress must pass funding legislation for the remaining nine of the twelve annual appropriations bills that were not finalized in late 2025. Apart from appropriations, leadership staff indicate the following issues are most likely to be on the House agenda during the first quarter of the year: Farm Bill (potential movement late in Q1), Permitting reform (timing and scope remain under discussion) and joint employer legislation. At the House GOP retreat earlier this week, the Speaker emphasized to members that these priorities and others will anchor the conference’s early-year agenda. Looking ahead to the GOP Member Retreat at Trump Doral on March 9, leadership is expected to begin pressing members on timing, sequencing, and strategic tradeoffs for the remainder of 2026. Leadership also flagged that House attendance will remain a meaningful constraint through at least April. With vacancies and inconsistent attendance, there may be periods where House Republicans do not have a reliable technical majority on the floor, complicating vote timing, and legislative execution.
Importantly, leadership discussions around a potential second reconciliation effort are intensifying. While no formal decision has been made, senior leadership staff emphasized that if Congress legislates meaningfully in 2026, reconciliation is increasingly viewed as the most viable vehicle. Leadership is beginning internal “pre-huddles” to scope what a reconciliation 2.0 package could include and the Speaker’s office and Majority Leader’s office are expected to run point, in coordination with the Budget Committee. Leadership is still finalizing the broader 2026 agenda, but the central strategic question—whether to pursue reconciliation—will shape nearly all major legislative pathways this year. At the same time, Republicans are increasingly focused on “affordability” as a defining issue heading into the 2026 midterms and are actively seeking policy proposals that align with that message.
The proposed American Franchise Act (AFA) (H.R.5267) introduced in the House has had companion legislation introduced in the Senate by Senators Marshall (R-KS) and King (I-ME). The “American Franchise Act”(AFA), bipartisan legislation introduced by Representatives Kevin Hern (R-OK) and Don Davis (D-NC) would amend the National Labor Relations Act to only allow a business to be considered a joint employer if that business exerted “substantial direct and immediate control” over specific conditions of employees’ jobs. The legal landscape has been volatile, with the standard shifting between presidential administrations and subject to court challenges. In early 2024, a federal court blocked the Biden administration’s broad NLRB joint employer rule from taking effect, leaving an earlier, narrower 2020 rule in place for the time being. Related legislation titled the Save Local Business Act (SLBA) (H.R.4366) has been introduced in various sessions of Congress, most recently in July 2025 and previously in 2023 and 2021. If passed by both the House and the Senate and signed into law, it would provide a permanent, statutory definition of a joint employer, overriding agency rules that can change with each new administration.
Sen. Chuck Grassley (R-IA) and other Senate Ag Republicans are calling for the year-round sale of E15 fuels to be attached to the Agriculture FY26 spending bill. EMA and other proponents support this measure that would allow gas stations to sell fuel with a blend of 15% ethanol. Senator Grassley stated to reporters on Thursday that he is in “regular contact” with the White House to stress the importance of E15. Lawmakers and a coalition of agriculture and biofuels groups have tried for years to attach year-round E15 provisions to funding bills and other must-pass vehicles but have been largely unsuccessful. This time may be different as Republicans are focused on providing relief to U.S. producers, who’ve been weathering President Trump’s tariff agenda, persistent inflation and high costs.
