Senate OKs Spending Deal, Partial Shutdown Still Likely — Here’s Why

The government will shut down at 12:01 a.m. Saturday despite a bipartisan deal, but this time it’s not expected to last long.

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Updated Jan 30, 2026 3:52 p.m. PST · 7 min read

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The government shut down at 12:01 a.m. Saturday despite a bipartisan deal, but this time it’s not expected to last long.

On Friday, the Senate approved a bipartisan deal to separate the Department of Homeland Security (DHS) funding bill from a larger spending package, temporarily easing a standoff between lawmakers.

Following a second killing of a U.S. citizen in Minneapolis by federal agents last week, Senate Democratic Leader Chuck Schumer released a statement saying that Senate Democrats would not allow a DHS bill to advance without reform measures. The deal does not include changes to Immigration and Customs Enforcement (ICE) practices and procedures, but will allow lawmakers more time to negotiate.

Under the deal, the Senate passed a funding package that didn’t include DHS funding, along with a short-term continuing resolution that keeps the DHS funded for two weeks.

Here’s the thing, the House must also pass the five-bill spending package and the DHS stopgap in order to avoid a shutdown, but the House isn’t in session until Monday. That’s why the shutdown is technically taking place even though the Senate approved funding and the stopgap before the deadline. The effects will be minimal. Americans are increasingly uneasy about the prospect of another government shutdown. More than 3 in 5 Americans (61%) are concerned about the impact of another government shutdown on their personal finances, according to a Jan. 6 poll conducted online by The Harris Poll on behalf of NerdWallet.

How we got here

On Jan. 22, the House passed the bipartisan “minibus” — a $1.2 trillion package of four more spending bills that includes appropriations for Defense, Labor, Health and Human Services, Education, Transportation, Housing and Urban Development, and Homeland Security. The minibus passed in the House by a margin of 341 to 88.

But on Thursday, a key vote to advance the spending package failed in the Senate with Democrats and several Republicans blocking the measure over funding for the Department of Homeland Security — a flashpoint for lawmakers after the Jan. 7 fatal shooting of 37-year old Renée Good by an Immigration and Customs Enforcement (ICE) agent in Minneapolis. The incident was followed weeks later with another deadly encounter in Minneapolis: On Jan. 24, a U.S. Customs and Border Protection (CBP) agent shot and killed 37-year old Alex Pretti.

“The appalling murders of Renee Good and Alex Pretti on the streets of Minneapolis must lead Republicans to join Democrats in overhauling ICE and CBP to protect the public,” said Schumer in a Jan. 25 statement. “People should be safe from abuse by their own government.”

The DHS bill that failed in the Senate didn’t include enough of the reforms that Democrats are bargaining for. Any eventual DHS funding would add to the $75 billion for ICE approved in the One Big Beautiful Bill Act last July.

On Jan. 28, Senate Democrats released their demands to reform ICE they say must be included in any DHS funding bill. The list includes ending roving patrols and requires agents to remove masks and wear visible identification and body cameras. It would also require ICE to maintain stricter requirements for conduct and use of warrants for searches and arrests.

» Stay informed: Check out NerdWallet's news hub for all the latest.

Why did the government shut down in 2025?

Every year, Congress is supposed to pass 12 spending bills to keep the government’s lights on. These appropriations bills fund those programs already approved by Congress, including defense, the IRS, food assistance, veterans’ benefits and national parks.

The deadline to fund programs for the next fiscal year — in this case 2025-2026 — is always Oct. 1. Without passing appropriations bills or approving a stopgap that kicks the deadline down the road, the government shuts down.

Why didn’t Congress pass the funding bills? The two parties are deadlocked over Democrats’ demands to permanently extend expiring Obamacare subsidies and roll back recent Medicaid cuts in the One Big, Beautiful Bill Act (OBBBA).

In the past few funding cycles, Congress has relied on multiple short-term continuing resolutions to keep the government temporarily running.

What happened when the government shut down?

On Nov. 5, the U.S. government shutdown became the longest in history. Up until that point, the longest-ever shutdown lasted 35 days. The shutdown inflicted a slew of hardships on federal workers, social benefits recipients and travelers:

Many thousands of federal workers were put on furlough while all other essential staff continued to report without pay. In the shutdown’s third week, most federal workers received partial paychecks for work through Sept. 30.

Thousands of flights were canceled after the shutdown began. On Nov. 7, air traffic in 40 “high traffic” markets was reduced by 10% as many air traffic controllers and TSA agents, forced to work without pay, called out sick. Safety concerns were cited as the reason for the reduction.
Certain benefit programs, financial aid disbursements and IRS verifications were delayed.
Federal courts across the country ran out of funds, forcing them closed or running with limited operations. The Supreme Court remained open, but the building was closed to the public.

SNAP funding had been set to halt on Nov. 1. But following rulings in two federal court cases, the White House agreed to partially fund SNAP, cutting payments to participants in half.

How did the 2025 shutdown end?

Trump signed a spending package on Nov. 12, ending the longest-ever government shutdown.

The House of Representatives came back to the Capitol after a seven-week recess to pass a package of measures to end the shutdown on its 43rd day.

The House passed the measures with a 222-209 vote on Nov. 12, largely along party lines. The Senate approved the package on Nov. 10 after enough Democrats crossed the aisle to give Republicans the 60 votes needed to pass the “minibus” package.

The minibus also included three bills that fund military construction, the Department of Veterans of Affairs, the Department of Agriculture and the Food and Drug Administration (FDA) and legislative branch operations. The package fully funds Supplemental Nutrition Assistance Program (SNAP), a government program that provides food benefits to low-income Americans, through September 2026.

The package also included a provision to rehire government employees laid off during the shutdown. Soon after the shutdown began, the White House sent notices to at least 4,100 workers in seven departments. Days later, however, a federal judge temporarily blocked the layoffs. The bill ensured the workers are not only rehired, but also receive backpay. In addition, the bill prohibits any other mass layoffs of federal workers through Jan. 30.

Since the previous shutdown began on Oct. 1, the Senate had voted on — and failed to pass — a GOP-backed funding stopgap to end the shutdown 14 times. Throughout the shutdown, Democrats sought concessions on health care spending.

Democrats didn’t receive their biggest demand: extended health care subsidies and rollbacks to cuts to Medicaid and Medicare that were included in the OBBBA. But there was one key inclusion in the package: a vote on Democrats’ Affordable Care Act Bill. In December, four Republicans split with their party to join Democrats to back a discharge petition on a bill to extend ACA subsidies for three years. On Jan. 8, the bill passed the House and is now with the Senate.

» MORE: How to prepare for the next government shutdown

How long did the government shutdown last?

At 43 days, the government shutdown was the longest in history. There have been 22 shutdowns since 1976 and most are short-lived — a few hours or days, at the most.

There hasn’t been a shutdown since the 2018-2019 shutdown, which lasted 35 days. The reason for that shutdown was a dispute over funding for Trump’s border wall in his first term.

Before that there was a 16-day shutdown in 2013 as negotiations over the Affordable Care Act dragged on. In 1995 and 1996, two shutdowns totaled 26 days.

What happens when the government shuts down?

Federal workers bore the brunt of the previous shutdown’s impact.

During a shutdown, there are ripple effects on delivery of government services and programs.

What’s affected immediately:

National parks may close or operate without services.
Federal student aid application processing could be delayed. The shutdown coincides with the opening of the Free Application for Federal Student Aid (FAFSA).
Food and drug inspections will be delayed.
The IRS can’t verify income and Social Security numbers, which could cause delays for some mortgages and other loan approvals, as well as tax refunds.

What will keep running, to a point:

Flights will still operate, but there could be delays if TSA agents and air traffic controllers, who are considered essential employees, decide to call out of work, leading to staff shortages. Even small shortages can have a big impact: During a 2019 government shutdown, the absence of just 10 air traffic controllers at two airports grounded flights and caused delays for the Eastern Seaboard. (Read more on how the shutdown affects travel.)

Social Security and Medicare will keep going, but some administrative functions may be suspended, and telehealth appointments may be interrupted.
Unemployment benefits will continue — states administer compensation — but there could be application processing delays if the shutdown lasts long enough.
Food benefits through Supplemental Nutrition Assistance Program (SNAP) and the accompanying WIC program will continue — both run on contingency funds. WIC funding will only last one month, and SNAP could be strained after 30 days, as well.

What won’t be affected:

The postal service — the USPS is not funded by the federal government.
Federal student loan payments — accounts are serviced by private companies.
Public schools will remain open — they’re funded by state and local governments.
Amtrak will continue operations — it is operated by a for-profit company.

However, if a shutdown happens after Jan. 30, it would not impact services — like SNAP — that were fully funded through Sept. 30 by the continuing resolution.

See more details on how a government shutdown could impact you.The shutdown has had trickle-down economic effects. One immediate and direct impact during the previous shutdown was a suspension of federal economic data. Most of that data wasn’t released during the shutdown. That’s a problem because the government’s official data releases guide the markets, the Federal Reserve and business decisions.

(Photo by Tom Brenner/Getty Images News via Getty Images)

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