Congress tees up spending package to extend TMF authorization through September

A new congressional spending bill could offer a lifeline to reauthorize the Technology Modernization Fund, which expired last month and froze nearly $200 million in unused funds. 

Congressional appropriators released the final slew of fiscal 2026 spending bills Tuesday, allocating more than $1 trillion to federal agencies and extending various laws or programs. 

Among the extensions is the reauthorization of the TMF through FY2026, or Sept. 30. It comes just over a month after authorization of the innovation funding vehicle expired Dec. 12. 

TMF was created in 2017 to fund technology projects across the government, but the bill that made it also set an expiration date that only Congress can extend. Lawmakers failed to move forward with standalone legislation to reauthorize the fund last month, and efforts to include it in larger spending packages also fell flat. 

Trade groups and IT industry experts were disappointed at the time, telling FedScoop in previous interviews that the expiration was not representative of the issue’s typical bipartisan support. Some pinned the blame on procedural hurdles in Congress, including the 43-day-long government shutdown that pushed various nonfunding priorities toward the end of the year. 

Rep. Nancy Mace, R-S.C., introduced bills in the last three Congresses to reauthorize TMF beyond 2025, but they did not make it out of the Senate, where they have at times faced pushback from congressional appropriators. Industry insiders predicted last month that reauthorization would be attached to an appropriations bill, given the hurdles in the Senate. 

Reauthorization does not require additional funds, just a vote from Congress. The TMF model was intended to be a self-replenishing working capital fund that provides initial funding to agencies for modernization projects. These projects are intended to save government money, and after a specific period, the agency is expected to repay those funds. At its expiration last month, the $200 million remaining in the fund was frozen. 

Since the fund’s inception, TMF has invested more than $1 billion into 70 different projects across 34 federal agencies. TMF-funded projects included the Department of Veterans Affairs’ digitization of payment forms and support for the General Services Administration’s Login.gov platform. 

Some industry leaders celebrated the provision Tuesday. 

Jim Carroll, CEO of the Professional Services Council, said PSC “commends” Congress for including the extension, writing in a statement that TMF’s extension “sends a clear signal” that the federal government “remains committed to evolving its technology to meet modern needs.” 

The TMF “also ensures agencies are able to partner more effectively with the commercial sector to improve federal systems and operations and support critical agency missions. Past TMF-supported projects have demonstrated measurable returns, accelerated modernization, and helped reduce taxpayer burden,” Carroll wrote. 

Members of the House returned to Washington on Tuesday and are expected to consider the package this week. The “minibus” package also includes funding for the departments of Defense, Homeland Security, Transportation, Housing and Urban Development, Education and Health and Human Services. The package would also extend the Cybersecurity and Information Sharing Act of 2015 and the State and Local Cybersecurity Grants Program through the end of the current fiscal year

Should it pass the lower chamber, it will be sent to the Senate, which will return from recess next week. 

These bills, along with another spending package, need to pass by Jan. 30 to avoid a partial government shutdown.