The odds of another partial government shutdown were raised yesterday after Democrats unveiled their initial border security proposal. The plan — which does not include funding for President Trump’s border wall priority — would allocate new funding for: (1) modernizing Border Patrol technology and infrastructure; (2) hiring 1,000 customs officers; and (3) “humanitarian” needs such as food and medical care. It’s a deal that the President is likely to reject, as he has reiterated he is willing to either shut down the government again, or bypass Congress and utilize military construction resources for the wall through a national emergency declaration.

House and Senate lawmakers began negotiations yesterday in hopes of striking a border security compromise, yet a bipartisan agreement remains elusive. In addition to the debate over President Trump’s $5.7 billion border wall priority, lawmakers have been hamstrung over the possibility of adding deals on immigration policy and the debt limit to the underlying negotiations. If the negotiators fail to craft a product that can pass both chambers in that time and earn the president's signature, funding is likely to lapse again for the Departments of Transportation, Agriculture, Homeland Security, Treasury, Commerce, Housing and Urban Development, Justice, State and Interior, as well as the IRS, National Science Foundation, FDA and EPA.

Both chambers of Congress are set to resume legislative business today following the contentious 35-day government shutdown. In the House, lawmakers will take up three suspension bills out of the Financial Services Committee: (1) a bill (H.R. 624) that would require the Securities and Exchange Commission (SEC) to carry out a study of Rule 10b5–1 trading plans; (2) a bill (H.R. 502) that would require the Comptroller General of the United States to carry out a study on how virtual currencies and online marketplaces are used to facilitate the financing of goods or services associated with illicit trafficking; and (3) a bill (H.R. 56) that would create an independent Financial Technology Task Force to combat terrorism and illicit financing. For the balance of the week, House lawmakers are set to work on a bill (H.R. 790) that would provide a pay increase for federal workers.

Senate leadership struck a deal yesterday to bring two government funding proposals to the floor for a vote in hopes of ending the 33-day shutdown. Under the terms of the agreement reached by Leaders Mitch McConnell (R-KY) and Chuck Schumer (D-NY), the Senate will first vote on President Trump’s proposal (text; summary), which provides $5.7 billion for his border wall priority in addition to temporary protections for young immigrants enrolled in the Deferred Action for Childhood Arrivals (DACA) program and Temporary Protected Status for refugees. If the President’s proposal fails to clear the upper chamber, Senators will then vote on a three-week continuing resolution (CR) that would fund shuttered departments and agencies through Feb. 8 — ensuring furloughed federal workers receive backpay while providing additional flexibility to reach a broader deal.

Congress will resume legislative business today after both chambers canceled their previously scheduled recess due to the ongoing government shutdown. Over the weekend, President Trump disclosed his latest offer to Democrats in hopes of striking a deal that ends the 32-day shutdown while also funding his border wall priority. In exchange for $5.7 billion in funding for the border wall, as well as funding for closed parts of the federal government, the president’s deal would provide a three-year extension of protections for young immigrants enrolled in the Deferred Action for Childhood Arrivals (DACA) program and an extension of Temporary Protected Status for refugees currently covered.