The Bellevue Compass

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Welcome back to the Bellevue Compass. There are just five short weeks until the midterm elections, and Congress is splitting its time between the Hill and home districts, getting last-minute campaigning in before Americans head to the polls. 

Legislators have been in and out of voting sessions in the past few weeks and there aren’t many session days between now and the end of the year, with members working on an abbreviated schedule to allow time for campaigning. We’ve got a recap of what’s happened, what’s going on, and our interpretation of what’s next as the midterm looms. 

The Congressional Breakdown

The most consequential thing that’s happened so far this fall was the House’s passage of a continuing resolution (CR) 370-48, with 19 Republicans and 29 Democrats opposed. The measure was already approved by the Senate by a large margin back in August, and President Trump signed it on September 2nd. 

The CR funds the government at current levels through December 11, so the previous deadline—today, September 30th—passes without any incident or gap in funding. Congress likely hopes to punt negotiation over larger funding issues until after the election, and is using the CR as a stopgap to give itself some breathing room in the lead-up to November. The CR did delay the Office of Management and Budget rule that Dems feared would let the administration cancel federal grants at will. More about that here. 

We’ll be waiting to see what happens when Congress starts moving again after the election, and what funding might get put on the chopping block. Inarguably, the upcoming seat changes will affect what we see through the end of the year. 

Republicans have already indicated that any “big bills” will have to wait until after the election, which means that Speaker Johnson’s hoped-for third reconciliation package is unlikely to move before November, if at all. 

Last week in the Senate, a resolution to limit President Trump’s military power to take action in Iran failed—for the 14th time. Four Republicans crossed the aisle to support it, but the measure was sunk by PA’s John Fetterman, the lone Democrat to vote no. Senator Dave McCormick (R-PA), also voted against alongside the Republican majority. The House passed its own version of a resolution on September 15th, and all signs point to support for the war softening amongst Republicans, especially those in tough races. We’ll be watching for another vote when the Senate returns after the election. 

On Tuesday, President Trump, Speaker Johnson, and a group of tech executives met at the White House for a “Joint Commitment on Frontier Responsibilities”. The “frontier” in question: AI. The discussion revolved around putting AI safety measures in the hands of the companies—an idea that’s been met with skepticism on Capitol Hill. 

Meanwhile, in the Senate, Sens. Mark Warner (D-Va.) Brian Schatz (D-Hawaii), and Andy Kim (D-N.J) have tried to fast-track the Artificial Intelligence Risk Management and Security Act by unanimous consent. The bill would create a safety board within the Commerce Department to set and enforce standards on companies creating and operating AI. Developers would be required to give the board access to new models at least 45 days before release and report incidents within 30 days, or 72 hours if national security is at risk. 

Senator Ted Cruz (R-Texas) was the objector who killed the bill, arguing that it hands too much power to the board and wants any federal standard to address the growing patchwork quilt of state-specific AI laws. Either way, it’s another topic we likely won’t see much meaningful movement on until after the election. 

Today, the Senate is expected to vote on the Ratepayer Protection Act, which seeks to protect Americans from rising energy prices as a result of new data centers popping up in states across the country. Senate Democrats are preparing to sink the legislation after its passage in the House, with Minority Leader Chuck Schumer (D-N.Y.) calling the bill “toothless”. 

Both chambers are returning on November 9 with about five weeks before the CR funding runs out, and lawmakers will be up against the clock to pass all twelve FY27 spending bills or another continuing resolution before funding lapses. Neither party seems keen on another shutdown so close to the election, but we’ll have to wait and see how it plays out. There’s another piece at play here: back in May, the Senate unanimously approved a resolution to withhold their pay during any future shutdowns, meaning there might be more pressure on legislators to get funding deals done, or risk going without paychecks. 

The Sector Breakdown

The Pennsylvania Impact

The good news is that with the CR signed, federal agencies, grant-funded programs, and the federal workforce aren’t facing an October shutdown and an incoming election at the same time. A continuing resolution means that funding holds flat, and nothing will change for Pennsylvania agencies funded wholly or partially by the federal government. But—we’ll be watching for whether the delay on the OMB grant rule is made permanent once Congress returns to talk about spending bills. That rule could change how any federal grant to a PA recipient is awarded or canceled. If it does get swept up into the larger funding bills, we’ll break it down. 

Outside of an averted shutdown, Washington’s fracture on the Iran War is echoing in Pennsylvania. Fetterman and McCormick voted to reject the resolution in the Senate, while Fitzpatrick was the lone Pennsylvania Republican to support the measure in the House. Voters, though, are less divided: a New York Times/Inquirer/Siena University poll conducted last week found 66% of PA voters disapprove of Trump’s handling of the war, and only 30% approve. The topic is likely to come up more as we near the election, and will help shape the debate as legislators campaign on issues like energy and cost of living.

We know AI is another hot topic in Pennsylvania, and with no federal movement to establish guardrails, we’re already seeing states begin drafting their own patchwork measures. We’ll be watching to see whether Cruz’s argument makes its way into actual legislation that might override local regulatory efforts. 

Keep us in your inbox for an exclusive election update in November. 

What We’re Watching

Did you know?  Pennsylvania was home to the nation’s first high-speed, multi-lane highway. The PA Turnpike we know and love is credited as the first to see rubber hit the road in October of 1940.

Till next time,