After a week spent with constituents in their home districts, House lawmakers are planning to vote on a Trump-endorsed budget plan that would direct congressional committees to slice $2 trillion from federal coffers to pay for $4.5 billion in tax cuts. The Senate cleared a narrower, $340-billion plan on Feb. 20.

Both bills boost funding for construction of the U.S.-Mexico border wall as well as immigration enforcement, domestic energy production and the U.S. Defense Dept. But the House bill comes closer to Trump’s desire for “one beautiful bill” by including tax reductions for individuals and corporations that were part of the 2017 Tax Cuts and Jobs Act, which are set to expire by the end of the year. Senate leaders said they wanted to pass a narrower, less-controversial package to allow the budgetary process to move forward, with the tax reductions to be considered later. 

Following Senate passage of its package by a largely partisan 52-48 vote, Budget Committee Chairman Lindsey Graham (R-S.C.) prodded House members to pass their version of the budget plan. “I hope the House can pass one big bill that meets President Trump’s priorities. But this approach provides money that we needed yesterday to continue the momentum on securing our border, enforcing our immigration laws and rebuilding our military. Time is of the essence.” 

Budget resolutions do not appropriate actual funding but provide instructions to committee members to align their bills with the priorities established under the budgetary blueprint. Legislation crafted as part of this process only needs a simple majority to pass, but lawmakers in both chambers must agree to the basic parameters of the resolution through the reconciliation process in order for it to take effect.

Both the House and Senate bills call for reductions in tax credits under the Inflation Reduction Act to help pay for the increases in discretionary spending in other areas. But the House bill would enact deeper cuts for basic entitlement programs, including Medicaid. 

One industry source expressed doubt that lawmakers would completely repeal the tax credits, which would help support construction of energy and other projects that are popular even among Republican-led states. “I think the conventional wisdom is that the appetite for repealing [the IRA tax credits] entirely is just not there, and they don't have a lot of margin in the House or Senate, really, for doing something like that. The geography and geology that affects how various energy sources perform is highly regional, and it does not reflect, does not respect party lines, so I an outright repeal of everything would be challenging.” 

Steve Hall, executive vice president of the American Council of Engineering Cos., says it’s a priority for his group to see the tax cuts for S-Corps and other pass-through businesses extended beyond the end of this year, as well as full tax deductibility for research and development activities in the year they occur, rather than amortized over several years as they are now. 

Keeping the Government Running

At the same time lawmakers are focused on the budget resolutions, those on the appropriations committees in both chambers are scrambling to reach an agreement on a way to prevent a government shutdown when the current continuing resolution—passed in December—expires March 14. Under the shadow of the Trump administration’s DOGE efforts, many industry groups are uneasy.  

“We want to see stability with our federal partners and continuity. There's a lot of work that needs to be done, and we just want to get it done, and you've got to have working agencies and funded agencies.” He adds that his group is concerned about what will happen with renewable energy projects going forward, as well as traditional infrastructure projects.  

“We’re hearing from firms in the field about very basic water projects that are on pause because of executive orders, and there’s uncertainty on the part of agencies as to what to do and whether to proceed," Hall says. "So we're trying to manage that process and work with our members and try to work with lawmakers to let those projects go forward.”

Danielle Cloutier, director of legislative affairs for the National Association of Clean Water Agencies, says her group is “most concerned about the investment dollars that our members rely on heavily for water infrastructure projects,” such as the state revolving fund programs and tax-exempt municipal bonds.

Water sector groups for years have called for more investment through state revolving funds and tax-exempt municipal bonds, not less. “These budget battles too often seem like an inside-the-beltway thing,” but they have real and significant impacts, she says.