Prepared in collaboration with Blank Rome Government Relations LLC (BRGR)

As Congress enters 2026, the legislative and regulatory landscape is taking shape amid a compressed congressional calendar and mounting election-year pressures. Blank Rome Government Relations LLC (BRGR), SWTA’s government relations partner, is closely monitoring several federal policy developments that will significantly impact public transportation, infrastructure investment, and related industries in the year ahead.

Federal Appropriations Outlook

Government funding is currently set to expire at the end of January, prompting lawmakers to finalize the remaining Fiscal Year 2026 (FY26) appropriations bills. In mid-January, Congress advanced multiple spending packages, leaving four major appropriations bills still pending: Defense; Labor, Health and Human Services, and Education; Transportation, Housing and Urban Development (THUD); and Homeland Security. Congressional leaders are optimistic that these measures will pass in the coming weeks, avoiding a government shutdown.

Looking ahead, FY26 funding will expire on September 30, requiring Congress to act on all FY27 appropriations bills. If past precedent holds, lawmakers may rely on a continuing resolution later in the year to extend funding while negotiations continue during the post-election “lame duck” session.

Surface Transportation Reauthorization

One of the most significant issues for transit stakeholders is the upcoming expiration of the Infrastructure Investment and Jobs Act (IIJA) on September 30. Congress must pass a new five-year surface transportation reauthorization to continue funding and policy direction for highways, transit, rail, and multimodal systems nationwide.

House Transportation and Infrastructure Committee leaders have indicated plans to mark up a reauthorization bill as early as March, with the goal of moving legislation through the House by mid-spring. The bill may also become a vehicle for broader permitting reform, though bipartisan negotiations on this issue remain uncertain.

Budget Reconciliation Discussions

Republicans are also considering a potential second budget reconciliation package in 2026. This process allows budget-related legislation to advance in the Senate with a simple majority vote. Proposals under discussion include significant tax and spending changes focused on housing, healthcare, and energy production. However, with narrow margins in the House and election-year dynamics, GOP leadership remains divided on whether to pursue reconciliation this year.

Trade and Tariff Developments

Congress may soon face pressure to address the Trump administration’s tariff authority if the U.S. Supreme Court does not rule on a pending legal challenge related to the International Emergency Economic Powers Act (IEEPA). Complicating matters further, a congressional resolution shielding emergency declarations from challenge is set to expire at the end of January, with uncertain prospects for renewal.

National Defense Authorization Act (NDAA)

Work has already begun on the FY27 National Defense Authorization Act (NDAA), which sets funding and policy for the Department of Defense. President Trump has proposed a $1.5 trillion defense budget emphasizing shipbuilding, modernization, and advanced technologies. Lawmakers are expected to begin hearings soon, and provisions related to maritime infrastructure — including the bipartisan SHIPS Act — may be incorporated into the legislation.

Water Resources Development Act (WRDA)

Congress is also expected to revisit the Water Resources Development Act (WRDA) later this year. Traditionally reauthorized every two years, WRDA directs the Army Corps of Engineers’ work on dredging, flood control, navigation, and environmental restoration. While historically bipartisan, negotiations could be influenced by broader federal funding disputes.

Key Federal Deadlines to Watch

• April 20: Expiration of FISA Section 702 authorities
• July 1: Formal review of the U.S.–Mexico–Canada Agreement (USMCA)
• September 30: Expiration of Farm Bill programs and FY26 funding

About the Author
This legislative update was prepared by Blank Rome Government Relations LLC (BRGR), a bipartisan government relations firm that advises organizations on federal policy, appropriations, and regulatory strategy. For more information, contact C.J. Zane, Managing Principal, Blank Rome Government Relations LLP.