This report provides an update on issues affecting federal managers. As always, I encourage you to visit www.fedmanagers.org on a regular basis for more information on these and other matters.

Also, be sure to look for the monthly FMA Grassroots Update where we offer links to action letters and FMA-PAC matters we do not address in the Washington Report. The grassroots newsletter is sent exclusively to non-governmental email addresses to avoid any Hatch Act violations. If you are not receiving it, contact the national office to provide your non-governmental email address.

Please feel free to provide feedback any time by emailing Greg Stanford at gstanford@fedmanagers.org, or by calling the National Office at (703) 683-8700. Thank you for your membership in FMA. It’s an honor to represent your interests before Congress and the administration.

On July 21, the House of Representatives passed a continuing resolution (H.R. 9770) that would fund all government agencies through December 4, 2026, and avert a lapse in funding at the end of Fiscal Year 2026. The Senate has agreed in principle to an expanded CR that would run through December 11, however uncertainty remains on its path forward. A vote could come as soon as today. These measures would fund all government agencies beyond the beginning of Fiscal Year 2027 (October 1) and the midterm elections scheduled for November 3.

Both the House and Senate are now in their traditional August recess. The House is scheduled to meet again on August 31, while the Senate plans to return on September 11. Both chambers of Congress will be in recess through October, giving members an opportunity to stay in their states and districts to campaign.

While the deal provides a measure of comfort and certainty averting another devastating shutdown, CRs still leave managers without the ability to plan ahead, meaning that large amounts of money cannot be used for bulk purchasing or other productive ways of using funds.

The House passed its version of the Fiscal Year 2027 National Defense Authorization Act (NDAA, H.R. 8800) on July 22, prior to leaving for its traditional August recess. The measure passed by a tight vote of 216-212.

“Our national security depends on a ready, capable, and well-equipped fighting force backed by a robust and innovative defense industrial base. The FY27 NDAA delivers that,” House Armed Services Committee Chairman Mike Rogers (R-AL) said in a statement. "Peace Through Strength begins long before the battlefield – it is forged in America’s factories, depots, and shipyards. After years of underinvestment, the FY27 NDAA revitalizes America’s defense industrial base and gives our military the capacity to deter our adversaries and carry out President Trump’s Peace Through Strength Agenda."

The $1.15 trillion measure includes an increase in uniformed military pay by 5-7 percent for 2026, pursuant to President Trump’s request. It remains silent on civilian pay. Rep. Steny Hoyer (D-MD), who offered a pay raise amendment for all feds in the appropriations process, was critical of the omission for defense civilians. “Hardworking civilian federal employees at the Defense Department are no less deserving of an annual raise than their compatriots in uniform. Oftentimes, civilian and military personnel work side by side doing similar work at the Pentagon and on bases across the world, yet this National Defense Authorization Act gives military personnel as much as a 7% raise while leaving civilian employees behind,” Hoyer said. Hoyer also criticized the topline figure for spending more than $1 trillion.

FMA-endorsed bipartisan legislation that would permanently avert future government shutdowns is getting a closer look in Congress. The Prevent Government Shutdowns Act (S. 4632), sponsored by Sens. James Lankford (R-OK) and Maggie Hassan (D-NH), was reintroduced in May 2026 and the subject of a July hearing in the House Appropriations Committee.

The bill would provide continuing appropriations at existing levels to prevent a government shutdown if the appropriations bills for a fiscal year have not been enacted before the fiscal year begins and continuing appropriations are not in effect. Upon a lapse in government funding, the Prevent Government Shutdowns Act would implement an automatic continuing resolution (CR), on rolling 14-day periods, based on the most current spending levels enacted in the previous fiscal year. During this time, particular restrictions would be instituted to ensure legislators work solely to restore funding, including:

In a letter to the White House, a group of 53 lawmakers from both the House and Senate, led by Sen. Tim Kaine (D-VA) and Rep. James Walkinshaw (D-VA) urged President Trump to provide additional information related to the creation of Schedule Policy/Career (Schedule P/C). The July 15 letter outlines a number of concerns related to the new classification, which formally took effect earlier this year, and posed 13 questions seeking information related to the implementation of the policy.

On June 3, President Trump signed an executive order formally converting approximately 8,000 career federal workers into the Schedule P/C classification. Schedule P/C is a federal job classification for positions deemed “confidential, policy-determining, policy-making, or policy-advocating character that are not normally subject to change as a result of a Presidential transition.” These employees can no longer challenge adverse actions to the Merit Systems Protection board and are now at-will employees.

While 8,000 employees were estimated to be included in this initial order, it is expected to be followed by additional tranches of employees as implementation of Schedule P/C continues. Current estimates are approximately 50,000 feds will ultimately be converted into Schedule P/C.

Sen. Elizabeth Warren (D-MA) and three Senate colleagues sent a letter to Social Security Administration (SSA) Commissioner Frank Bisignano on July 29 asking for detailed information about SSA field office operational status and whether offices have closed to the public. The Senators point out SSA shed approximately 7,500 feds in the past year and raises concerns about the agency’s ability to effectively serve the American public.

In the letter, Warren, joined by Sens. Bernie Sanders (I-VT), Richard Blumenthal (D-CT), and Tammy Baldwin (D-WI), cite Bisignano’s “promise to keep field offices open,” but note more than a dozen offices that have been closed to the public for extended periods of time. They seek detailed information from SSA, including average wait times to schedule appointments, specifics about staffing and availability at field offices, and information about any field office that has been closed for 72 hours or more. To view all of the questions included in the letter, you can read it in full here.

As regular readers of the Washington Report know, this month will prove to be an important month for federal employees curious about a pay raise in 2027. President Trump did not include a pay raise for federal employees in 2027 as part of his budget request, and Congress has not included any language supporting a raise in current versions of the Financial Services funding bill, typically where a pay raise or pay freeze would be included.

The House Appropriations Committee rejected an amendment to include a 3.6 percent pay raise offered by Rep. Steny Hoyer (D-MD) by a party-line vote, with 28 Democrats supporting and 32 Republicans in opposition. Subcommittee Chairman David Joyce (R-OH) referenced President Trump’s ability to use an alternative pay plan, calling the committee’s rejection of a pay raise, “the reality of politics, and exactly why we have elections every four years.”

The Office of Personnel Management (OPM) recently finalized rules to seize appeals process power from the Merit Systems Protections Board (MSPB), including suitability and RIF appeals. Reaction to the effort was mixed, with some supportive of the goal to reduce the time required to handle these cases, while others expressed concern that consolidating and centralizing these processes limits independent checks.

The purpose of the now-final rule regarding suitability is “to streamline suitability action appeals procedures, thereby improving the efficiency, rigor and timeliness by which OPM and agencies resolve challenges to suitability actions and ensure the integrity and efficiency of the service.” The end result of the rulemaking would consolidate decision making and give OPM more power over the federal employees’ appeals process.

Pursuant to the rule, OPM will handle adjudication of suitability appeals instead of the Merit Systems Protection Board. The action follows President Trump’s executive order to take over these appeals.

Federal employees at the Internal Revenue Service (IRS) and Social Security Administration (SSA) may no longer use “advanced” annual or sick leave, according to multiple reports.

Announced to IRS employees via email on July 24, advanced annual and sick leave approval is suspended, effectively immediately. SSA, led by Frank Bisignano, has reported a similar message. The suspensions are agency-wide and there is no timetable on when – or if – the suspensions may be lifted.

At least for now, the IRS and SSA will no longer accept requests for advanced leave, and all current pending requests are denied. The decision does not impact an employee’s ability to use leave already accrued. Employees are directed to use earned leave balances, a voluntary leave transfer program, or the Family and Medical Leave Act in the meantime.

The Office of Personnel Management (OPM) moved forward in late July with its effort to collect health data of federal workers and retirees. Originally publicized earlier this year, OPM intends to collect service use and cost data from Federal Employee Health Benefits (FEHB) carriers to “enable OPM to oversee health benefits programs and ensure they provide competitive, quality, and affordable plans.” The record keeping system was implemented on July 24.

FMA National President Linda Lentjes expressed general support with OPM’s oversight efforts in April, while urging strict limits on the collection of individually identifiable health information, citing cybersecurity risks and fears of a chilling effect on workers seeking care. She wrote to OPM Director Scott Kupor to outline the concerns related to the collection of sensitive health data and offered recommendations to ensure privacy.

"Effective government requires both accountability and the protection of individual rights. These goals are not incompatible," Lentjes wrote.