After 14 days of the shutdown of the federal government, Senate leaders appear to be making progress on negotiating a bipartisan agreement to raise the debt ceiling and reopen the government. The agreement is expected to provide benchmarks for further negotiations on the FY14 budget, FY14 appropriations, and sequestration. With an October 17 deadline to increase the debt limit or face default on the nation’s debt, Congress must act swiftly to avoid a downgrading of the country’s credit rating. On October 10, House Republicans began negotiations with President Barack Obama and Senate Democrats. The President met with a group of 18 Republicans who were seeking a short-term debt ceiling extension, but continue the government shutdown. Negotiations broke down by the morning of October 12 and the House adjourned, leaving the Senate to find a solution.On the Senate side, Senator Susan Collins (R-ME) made a proposal on October 10 that would reopen the government, extend the debt limit, and provide flexibility to agencies to manage sequestration cuts over the next two years. The proposal would also make Affordable Care Act (ACA) related changes including repealing or delaying the medical device tax. Although there was some bipartisan approval of the proposal, it was rejected by Senate Majority Leader Harry Reid (D-NV). By October 14, negotiations between Senator Reid and Senate Minority Leader Mitch McConnell (R-KY) appeared productive. The Senators reportedly are crafting an agreement that would raise the debt ceiling until February 7 and reopen the government. The deal would include a continuing resolution (CR) that would provide FY13 post-sequester funding through January 15, 2014. The House and Senate would be required to appoint conferees to a conference committee on the FY14 budget resolution, charged with issuing a report by December 13. The proposal may include flexibility for federal agencies to manage sequestration cuts, which would be implemented in January 2014. While the provisions sought by House Republicans to delay or repeal the ACA would not be included, reportedly the Senators are negotiating to include a provision that would require that the income levels of ACA subsidy recipients be verified. The delay of the medical device tax proposed by Senator Collins likely would not be included. While some House Republicans may not support the Senate plan, there is no time left for continued negotiations over the legislation. Although a plan that can pass both the Senate and the House and meet the approval of the President may be near, negotiations are too fragile to be able to predict the outcome yet.The Campaign for Housing and Community Development Funding (CHCDF), a group of 75 national organizations facilitated by NLIHC, sent a letter to House and Senate leaders urging them to reopen the government and provide FY14 HUD and USDA Rural Housing funding in a CR above FY13 funding levels. In the October 8 letter, the organizations write, “a long-term or year-long CR at FY13 funding levels for HUD’s programs will not be adequate to address the growing housing needs of millions of low income households. The multi-year decline in funding for many HUD program coupled with deep cuts from sequestration has forced providers and local communities to do less with less, reducing the number of households being served.” The organizations call on Congress to “quickly… open the government, eliminate sequestration, and provide funding for HUD’s programs as proposed by S. 1243 and full funding for USDA Rural Housing Service programs.” View the CHCDF letter at: http://bit.ly/1c9IuBq