Government shutdown live updates: House approves new funding bill

The funding options Republicans are mulling over to avoid a government shutdown exclude Trump's demand to extend or eliminate the debt ceiling.

But sources told ABC News that Republicans came to an “agreement” on Friday to raise the debt limit by $1.5 trillion in the first reconciliation package of the next Congress, with a $2.5 trillion cut in net mandatory spending in the process.

This was presented to members in a closed-door meeting to discuss spending ahead of Friday night's shutdown deadline.

Mandatory spending includes highly popular entitlement programs like Social Security and Medicare -- which Trump vowed on the campaign trail not to touch.

-ABC News' Jay O'Brien, Lauren Peller, Isabella Murray, John Parkinson and Emily Chang

House Speaker Mike Johnson was confident there would be no shutdown after huddling with his conference behind closed doors for several hours.

Johnson told reporters that Republicans have reached an agreement “to move forward." Though he notably declined to divulge the particulars of the plan ahead of a potential vote on Friday afternoon.

“We have a unified Republican conference,” Johnson said.

“There is a unanimous agreement in the room that we need to move forward," he added.

Leaving the meeting, Johnson hinted that he was prepared to run the latest plan past Trump.

“I will not telegraph to you the specific details of that yet, because I've got a couple of things I got to wrap up in a few moments upstairs, but I expect that we will be proceeding forward,” Johnson said.

Nevertheless, the speaker predicted that Congress will act prior to the funding deadline tonight.

“We will not have a government shutdown, and we will meet our obligations for our farmers who need aid, for the disaster victims all over the country, and making sure that military and essential services and everyone who relies upon the federal government for a paycheck is paid over the holidays. I'll give you the more details here in just a few moments,” Johnson said.

-ABC News' Jay O'Brien, Lauren Peller and John Parkinson

According to multiple sources, Republican House leadership laid out two options at the conference meeting to fund the government.

One option is a clean continuing resolution to fund the government at current levels until March without debt limit suspension. The vote would be held under suspension of the rules, requiring a two-thirds majority.

The other choice is to hold separate votes on a clean continuing resolution to March, on additional disaster relief and on an extension of farm bill.

House Majority Leader Steve Scalise, R-La., declined to provide details on what the next step is to avert a government shutdown as he emerged from the meeting.

"So, we are talking through different options," Scalise said.

Asked by ABC News' Jay O'Brien if taking the debt limit out of the equation defies Trump, Scalise responded: "The debt limit is taken out because the Democrats walked away from that last night."

Sources tell ABC News Republicans also came to an "agreement" to raise the debt limit by $1.5 trillion in the first reconciliation package with a $2.5 trillion cut in net mandatory spending in the reconciliation process. This was presented to members in the closed-door meeting.

-ABC News' Jay O'Brien, Lauren Peller, Isabella Murray, John Parkinson and Emily Chang

House Democratic Leader Hakeem Jeffries on Friday blasted Republicans for prioritizing Elon Musk's budget ideas over child cancer research.

Musk helped to tank a bipartisan spending bill that included over $100 million for pediatric cancer research. The second funding bill pitched by House Republicans, which failed to pass on Thursday night, did not contain those funds.

The initial compromise bill also included new policy provisions to help kids with cancer on Children's Health Insurance Program and Medicaid travel across state lines to receive gene therapies in other states. It also had a provision to allow studies and clinical trials for kids with a combination of drugs and treatments.

It also had language to protect rural broadband customers from predatory and junk service providers; a provision to prohibit deepfake porn; an entire bill about strengthening semiconductor supply chains; and new provisions going after hotels for hidden fees.

Provisions aimed at countering concerns about China's influence that both parties share were also in the bipartisan bill. The language would have hemmed in some American investment in China by blocking some transactions in some areas like technology and chip manufacturing, and would have mandated U.S. government reviews of Chinese real estate purchases near American national security sites.

-ABC News' MaryAlice Parks and Michelle Stoddart