The federal government shut down on Wednesday—the first lapse since 2019—with no deal in sight. Both chambers are at an impasse after dueling stopgap funding bills failed again this week. (AP News, Oct. 2)

State of Play

• Senate Democrats blocked Republicans’ “clean” Nov. 21 continuing resolution (CR). Republicans rejected Democrats’ version that included extending enhanced Affordable Care Act subsidies and reversing Medicaid cuts.

• Senate Majority Leader John Thune (R-SD) and Minority Leader Chuck Schumer (D-NY) may meet Friday in their first one-on-one since the standoff began. Another round of votes is planned for Friday. (Punchbowl News, Oct. 2)

• If Democrats block the GOP plan again, Majority Leader Thune is expected to adjourn the Senate until Monday, canceling Saturday votes, and force another vote on Monday. (Punchbowl News, Oct. 2)

• In response to the shutdown, OMB Director Russ Vought has stopped funding for the Hudson Tunnel Project and the Second Avenue Subway in New York City and canceled energy projects in several states. (NYT, Oct. 1)

CRE Impact

• NFIP: The National Flood Insurance Program (NFIP) cannot issue new policies or renewals during the shutdown, threatening thousands of real estate transactions. The Real Estate Roundtable (RER) supports a long-term, sustainable NFIP reauthorization to avoid recurring market disruptions. (Roundtable Weekly, Sept. 19)

• Senate Banking Committee Chair Tim Scott (R-SC) “remains committed” to funding the program and is “optimistic” Democrats will join Republicans to prevent a lapse in coverage during peak hurricane season, his spokesperson said. (Politico, Sept. 30)

• Energy: The ENERGY STAR program has halted partner application processing, product list updates, and specification releases—stalling efficiency certifications important to building owners and tenants. Meanwhile, it remains unclear how the shutdown will affect EPA Administrator Lee Zeldin’s broader reorganization and regulatory timeline. (PoliticoPro, Sept. 30, Oct. 1 | NAHB, Oct. 1)

• Housing: HUD is unable to access certain funds used to prevent evictions in its Tenant-Based Rental Assistance Program. Affordable housing initiatives also face delays due to the furloughing of program staff. (Politico, Sept. 30)

• Construction: Fallout from the shutdown is also reverberating through the construction sector, where contractors warn that halting federal projects will ripple into private markets by raising costs and eroding confidence. (UtilityDive, Oct. 1)

• Tax Policy & Treasury: Despite the shutdown, Treasury has said it will continue implementing President Trump’s tax law and deregulatory agenda, relying on multi-year funding streams. Its tax policy office will remain active, advancing the president's tax cuts and regulatory rollbacks. Other Treasury operations—including debt management, collections, and oversight of financial markets will also continue. (PoliticoPro, Sept. 29)

• “Government shutdowns and temporary extensions of essential programs like the NFIP create avoidable uncertainty that disrupts real estate markets and undermines economic confidence,” said RER President & CEO Jeffrey DeBoer. “Congress should act responsibly by providing long-term solutions that protect communities and the American people, encourage investment, and sustain growth.”

As the shutdown continues, mounting strain on real estate transactions, insurance coverage, and investment planning will intensify pressure on Congress to resolve the impasse.