Short Answer

Both the model and the market overwhelmingly agree that funding for ICE/CBP lasting ≥1 year is most likely to be included in the next reconciliation bill, with only minor residual uncertainty.

1. Market Behavior & Drivers

This market has exhibited a completely stable and sideways trend since its inception. The price opened at a 96.0% probability and has not deviated, holding steady at this level through the most recent data point. There have been no significant price spikes or drops to analyze. The 96.0% mark is the only price point with any activity, effectively serving as both a support and resistance level that has not been tested.
The trading volume provides a clear picture of market conviction. All 184 contracts were traded on the first day, May 15, 2026, establishing the high initial probability. Since then, trading volume has been zero. This pattern suggests that an initial consensus was reached quickly and that no subsequent news or changes in outlook have been significant enough to attract new trades or challenge the established price. The market appears to be in a strong state of agreement.
The high and unwavering price of 96.0% indicates that traders have an extremely high degree of confidence that a reconciliation bill containing some provisions will be advanced before 2027. The recent news context, with reports from May 22, 2026, that House GOP leaders are aiming to pass a third reconciliation bill, aligns with and reinforces this strong market sentiment. Because the price was already at 96.0% before these specific reports, the news appears to have confirmed the market's existing expectations rather than causing a new shift in probability.
  • The FY2026 budget resolution is expected to shape Reconciliation 3.0's content.
  • House GOP leadership is actively planning a third reconciliation bill.
  • House Republicans appear to target EITC improper payments for the next bill.
  • EITC improper payment provisions may encounter legislative hurdles despite potential savings.
  • House and Senate Republicans exhibit differing reconciliation priorities for FY2026.

Who Wins and Why

Outcome Market Model Why
Ballroom security funding 2.0% 0.7% Ballroom security funding is unlikely to be a priority for a budget reconciliation bill.
Funding for ICE/CBP lasting ≥3 years 94.0% 92.1% Funding for ICE/CBP for multiple years is a likely target for budget-related legislation.
Secret Service funding 18.0% 5.6% Secret Service funding is typically handled through regular appropriations, not reconciliation.
Funding for all of DHS lasting ≥3 years 1.0% 0.3% Long-term funding for an entire department is generally outside reconciliation's scope.
Funding for all of DHS lasting ≥1 year 1.0% 0.3% Full departmental funding is usually addressed in broader spending bills.

Current Context

House GOP leaders aim for quick passage of a third reconciliation bill. As of May 22, 2026, House Budget Committee Chair Jodey Arrington indicated a Republican leadership desire to swiftly advance a "Reconciliation 3.0" bill, setting a goal for a budget blueprint by June and aiming for passage before the August recess. No final list of provisions has been publicly confirmed as of that reporting date [1][2]. The envisioned legislation broadly frames its purpose around targeting fraud and waste while improving affordability [1][2][3].
Proposed provisions center on combating fraud and improving affordability. Reports suggest Arrington aims to include additional funding for the Pentagon alongside measures to cut fraud and enhance affordability in housing and healthcare [1][2][3]. A March 30, 2026, report specifically attributes to Arrington a focus on fraud within "78 means-tested programs," citing Government Accountability Office (GAO) figures on improper payments, including discussions related to the Earned Income Tax Credit (EITC). This indicates that significant components of the next reconciliation package could involve enforcement and savings derived from targeting fraud and improper payments [4].
While passage probabilities are high, specific bill contents remain unknown. Prediction market data from Polymarket indicates that traders assign a high probability to the passage of a reconciliation bill by late May 2026, with an outcome like "May 31" leading at the time of capture [5]. However, this data does not specify the particular provisions that would be included. Congressional procedural guidance from the Congressional Research Service (CRS) emphasizes that the contents of reconciliation bills are strictly limited by the directives outlined in the budget resolution and subject to the Byrd rule's constraints on extraneous matter. Consequently, the precise contents of a future reconciliation bill cannot be fully known until the final budget resolution directives are issued and specific committee text is developed [6][7][8][9].
Sources (9)
  1. 1House GOP still planning for third reconciliation bill - E&E News by POLITICOeenews.net
  2. 2Arrington wants third reconciliation bill by August recesspunchbowl.news
  3. 3Perfidious Senate GOP Leaders Bait-and-Switch the Right on Reconciliation 3.0 - The Daily Signaldailysignal.com
  4. 4Budget reconciliation bill to target ‘fraud’ in means-tested programs, chairman says – Roll Callrollcall.com
  5. 5Will the Senate pass a reconciliation bill by...? Predict... 2026 | Polymarketpolymarket.com
  6. 6The Reconciliation Process: Frequently Asked Questions | Congress.gov | Library of Congresscongress.gov
  7. 7https://www.congress.gov/crs_external_products/R/PDF/R48444/R48444.1.pdfcongress.gov
  8. 8S.Con.Res. 33: The FY2026 Budget Resolution - EveryCRSReport.comeverycrsreport.com
  9. 9https://www.congress.gov/crs_external_products/R/PDF/R48474/R48474.1.pdfcongress.gov

2. Price Chart

Historical Price (Probability)

Outcome probability
Date

3. Market Data

Contract Snapshot

This market resolves to "Yes" if the next reconciliation bill enacted into law includes any restriction on or defunding of the "Anti-Weaponization Fund" before January 1, 2027. A "No" resolution occurs if no such provision is included by this deadline. The outcome is verified from the Library of Congress, and the market closes early if the event occurs, otherwise by January 1, 2027, at 10:00 AM EST.

Available Contracts

Market options and current pricing

Outcome bucket Yes (price) No (price) Last trade probability
Funding for ICE/CBP lasting ≥1 year $0.99 $0.06 96%
Funding for ICE/CBP lasting ≥3 years $0.97 $0.07 94%
'Anti-weaponization' fund restrictions $0.78 $0.29 73%
Secret Service funding $0.18 $0.86 18%
Defense appropriations >$1 billion $0.08 $0.98 9%
Reduction in Medicaid spending $0.07 $1.00 6%
Ballroom security funding $0.02 $0.99 2%
Funding for all of DHS lasting ≥1 year $0.05 $0.99 1%
Funding for all of DHS lasting ≥3 years $0.07 $0.99 1%
Reducing EITC improper payments $0.07 $0.99 0%
State grants for election administration $0.07 $0.99 0%

Market Discussion

Traders are primarily discussing the inclusion of 'Anti-weaponization' fund restrictions in the next reconciliation bill, with the market showing a 73% probability for "Yes." The main argument for "Yes" is that many Republican senators (including Cornyn, Tillis, Cassidy, Cruz, Paul, and Collins) are expected to oppose the fund without restrictions, viewing it as a "slush fund" or a political "headache." There are no explicit arguments for "No" presented, indicating a strong consensus among traders for the "Yes" outcome, with one trader noting increased confidence after the Texas runoff.

4. What upcoming procedural milestones, such as the FY2026 budget resolution, will most directly shape the final contents of a 'Reconciliation 3.0' bill before the August 2026 recess?

Budget Resolution Planned DateJune 2026 [1]
Target LegislationReconciliation 3.0 [1]
Target Passage DeadlineBefore August 2026 recess [2][1]
The FY2026 budget resolution will shape Reconciliation 3.0's content. This critical procedural milestone is set to directly determine the final contents of a 'Reconciliation 3.0' bill, as it must incorporate reconciliation directives for specific committees and establish updated budgetary levels for the new legislative package [3][4][5][1]. House Budget Chair Jodey Arrington plans to introduce a new budget blueprint in June 2026 to facilitate this third reconciliation bill. Proposed items for 'Reconciliation 3.0' include efforts to combat fraud, enhance the affordability of goods, potential Department of Defense spending, tax cuts, and possible modifications to safety net programs [1][6].
Procedural hurdles and timeline will constrain Reconciliation 3.0's passage. The legislation faces several significant procedural challenges, notably the Byrd Rule, which restricts the inclusion of non-budgetary provisions [5][7]. Further obstacles include potential opposition from within the GOP caucus and the necessity of securing sufficient votes in both the House and Senate [5][7]. These constraints will inevitably influence the ultimate contents of the bill. The timeline for passing Reconciliation 3.0 is narrow, with House GOP leaders evaluating whether the legislation can be successfully advanced by the end of July, prior to the August 2026 recess [2][1].
Sources (7)
  1. 1House GOP still planning for third reconciliation bill - E&E News by POLITICOeenews.net
  2. 2May 26, 2026 | Capitol Hill Weeklykpmg.com
  3. 3S.Con.Res. 33: The FY2026 Budget Resolutioneverycrsreport.com
  4. 4S.Con.Res. 33: The FY2026 Budget Resolution - EveryCRSReport.comeverycrsreport.com
  5. 5What’s in the Senate FY 2026 Budget Resolution?-2026-04-23crfb.org
  6. 6Senate Republicans Release $72 Billion Reconciliation Bill Funding ICE, CBP, and White House Security | National Low Income Housing Coalitionnlihc.org
  7. 7The Reconciliation Process: Frequently Asked Questions | Congress.gov | Library of Congresscongress.gov

5. What specific statements from House Budget Chairman Jodey Arrington and the House Freedom Caucus signal that reducing EITC improper payments is a primary target for the next reconciliation bill?

EITC improper payment rate characterizationloses 30 cents on every dollar [1][2]
Legislative vehicle for reformnext reconciliation bill [1]
Key proponents for EITC reformHouse Budget Committee Chairman Jodey Arrington and the House Freedom Caucus [1]
House Republicans target EITC improper payments for the next reconciliation bill. Both House Budget Committee Chairman Jodey Arrington and the House Freedom Caucus have signaled that reducing Earned Income Tax Credit (EITC) improper payments is a primary objective for the next reconciliation bill. These groups prioritize integrity reforms across means-tested programs, with the EITC receiving specific attention due to its elevated rates of improper payments [1][2][3][4].
Chairman Arrington specifically targets EITC to offset spending. He has explicitly identified the EITC as a priority for inclusion in upcoming reconciliation bills. Arrington characterized the EITC as a cash welfare program that experiences a 30-cent loss on every dollar, linking efforts to curb its improper payments to the broader Republican aim of identifying budget offsets for priorities such as defense spending [1][2].
Freedom Caucus supports reforms, citing past fraud provisions. The House Freedom Caucus consistently advocates for fiscally responsible reconciliation packages that include significant spending cuts and integrity reforms for means-tested programs. This approach is consistent with their successful push for incorporating fraud and abuse provisions into the 2025 "One Big Beautiful Bill" [3][4].
Sources (4)
  1. 1Budget reconciliation bill to target ‘fraud’ in means-tested programs, chairman says – Roll Callrollcall.com
  2. 2Chairman Arrington on Squawk Box: Republicans are prepared for Reconciliation 3.0 | The U.S. House Committee on the Budget - House Budget Committeebudget.house.gov
  3. 3House Freedom Caucus Statement on Passage of Budget Resolution | Congressman Andy Harrisharris.house.gov
  4. 4House Freedom Caucus' Energy Policy Changes Improved House Reconciliation Bill - Publications - National Taxpayers Unionntu.org

6. How do the stated reconciliation priorities of House GOP leaders compare with the potential legislative agenda of Senate Republican leaders for FY2026?

Current Reconciliation Bill FundingApproximately $72 billion for ICE/CBP (goal by June 1, 2026) [1][2][3]
House Third Reconciliation Package TargetBefore August 2026 recess [2]
FY2026 Budget Resolution Limit$140 billion total ($70 billion per chamber) [4][5][3]
House and Senate Republicans exhibit differing reconciliation priorities for FY2026 legislation. Currently, a second reconciliation bill is underway, allocating approximately $72 billion to fund Immigration and Customs Enforcement (ICE) and Customs and Border Protection (CBP), with a target passage date of June 1, 2026 [1][2][3]. While Senate leadership, including Majority Leader John Thune, favors maintaining the focus of current reconciliation efforts on immigration, House Republican leaders have explored the possibility of enacting a third reconciliation package before the August 2026 recess, potentially addressing issues of affordability or pursuing additional spending reductions [1][2].
The FY2026 budget resolution provides the framework for reconciliation legislation. S.Con.Res. 33, adopted in April 2026, includes directives to two committees in each chamber, authorizing up to $140 billion in deficit-increasing legislation, with an allocation of up to $70 billion per chamber [4][5][3]. House Republicans envision a potential third package centered on program integrity or combating waste, fraud, and abuse to offset previous expenditures [2]. Despite the Senate leadership's singular focus on immigration, internal pressure exists among some members to incorporate broader priorities such as military funding or specific safety net program reforms into future reconciliation efforts [1][2].
Sources (5)
  1. 1Congressional Republicans Eye Budget Reconciliation 2.0 - Medicare Rights Centermedicarerights.org
  2. 2House Republicans Plot Potential Third Reconciliation Package While Work Continues on $72 Billion Reconciliation Bill Funding ICE and CBP | National Low Income Housing Coalitionnlihc.org
  3. 3Senate Republicans Pass Budget Resolution Laying Groundwork for Reconciliation Bill to Fund ICE and CBP | National Low Income Housing Coalitionnlihc.org
  4. 4S.Con.Res. 33: The FY2026 Budget Resolutioneverycrsreport.com
  5. 5The Republican 2026 Budget Resolution Unlocks Reconciliation 2.0democrats-budget.house.gov

7. What historical data from the CBO and GAO is available on the budgetary impact of reducing improper payments in federal programs like EITC and Medicaid?

Cumulative Improper Payments (since FY2003)$2.8 trillion (since fiscal year 2003) [1][2][3][4]
Improper Payments Reported (FY2025)Approximately $186 billion [2][3][4]
Improper Payments Reported (FY2024)$162 billion [2][3][4]
Federal improper payments consistently accumulate significant billions across various programs. The Government Accountability Office (GAO) extensively monitors improper payments throughout federal agencies, frequently identifying programs such as Medicare, Medicaid, and the Earned Income Tax Credit (EITC) for their high volumes [1][5][2][3]. Cumulatively, the GAO has estimated federal improper payments total $2.8 trillion since fiscal year 2003 [1][2][3][4]. More recent annual estimates include approximately $186 billion reported for fiscal year 2025 and $162 billion for fiscal year 2024 [2][3][4].
CBO and GAO identify opportunities, but lack specific historical savings data. The Congressional Budget Office (CBO) maintains a database of budget options that includes proposals to reduce federal spending through Medicaid modifications and enhanced program integrity [5][6]. Similarly, the GAO has issued numerous recommendations to agencies, such as the Centers for Medicare & Medicaid Services (CMS), aimed at improving program integrity and realizing potential savings [1][5][2][3]. However, specific, isolated CBO savings estimates solely for reducing improper payments in EITC or Medicaid are typically embedded within broader policy reform analyses, rather than being presented as standalone figures. Consequently, there is no available historical data from either the CBO or GAO that quantifies the specific, isolated budgetary impact, in terms of actual dollars saved, directly resulting from reductions in improper payments within the EITC or Medicaid programs [5][6].
Sources (6)
  1. 1GAO-25-108172, PROGRAM INTEGRITY: Agencies and Congress Can Take Actions to Better Manage Improper Payments and Fraud Risksfiles.gao.gov
  2. 2Federal Improper Payments Total $186 Billion in FY 2025-2026-05-20crfb.org
  3. 3Federal Government Made an Estimated $162 billion in Improper Payments Last Fiscal Year | U.S. GAOgao.gov
  4. 4Improper Payments: Information on Agencies' Fiscal Year 2024 Estimates | U.S. GAOgao.gov
  5. 5Medicare and Medicaid: Additional Actions Needed to Enhance Program Integrity and Save Billions | U.S. GAOgao.gov
  6. 6Budget Optionscbo.gov

8. How do provisions targeting EITC improper payments compare to those for reducing Medicaid spending in terms of budgetary savings and political viability within the Republican conference?

EITC Annual Savings (projected)over $2 billion annually [1]
EITC Improper Payment Rate (FY2023)about one-third of payments (≈$21.9B) [2][3]
Potential Medicaid Funding Reductionabout $900B [4]
EITC improper payment provisions encounter legislative hurdles despite significant potential savings. A proposed EITC “precertification” measure, which the Congressional Budget Office (CBO) estimated would save over $2 billion annually, was reportedly removed from a Republican reconciliation bill because it did not meet Byrd-rule requirements [1]. Despite this legislative setback, the Earned Income Tax Credit program continues to experience substantial improper payments, with an error rate of approximately one-third of total payments, amounting to about $21.9 billion in FY2023. These figures provide a clear rationale for pursuing "recapture" savings in future tax reform discussions [2][3].
Medicaid spending cuts face GOP resistance and high savings targets. Strategies aimed at reducing Medicaid spending within Republican reconciliation proposals have encountered significant internal resistance. House GOP members from swing districts have reportedly opposed measures that would strip benefits [5], while more conservative members have demanded verifiable savings of at least $2 trillion to support any legislation [6]. The CBO has scored Medicaid savings targets as very large, with one panel specifically tasked with identifying $880 billion in savings, predominantly from Medicaid [5][6]. Furthermore, separate reports indicate that reconciliation approaches passed by the House and considered by Senate committees could reduce federal Medicaid funding by approximately $900 billion, potentially leading to an estimated 10.9 million coverage losses [4].
Sources (6)
  1. 1Balancing program integrity and administrative burdens: Lessons for the EITC and CTC - Niskanen Centerniskanencenter.org
  2. 2https://bipartisanpolicy.org/wp-content/uploads/2024/12/BPC_Improper-Payments-EITC-CTC-Report_R04.pdfbipartisanpolicy.org
  3. 3Disentangling in-work and child tax credits to address improper payments: An incremental approach to comprehensive reform - Niskanen Centerniskanencenter.org
  4. 4Senate Finance Unveils Reconciliation Legislation: Further Medicaid Cuts and Notable Policy Changes from House-Passed Billshvs.org
  5. 5A fight over Medicaid cuts is threatening GOP plans for Trump's 'big, beautiful bill' | NPR & Houston Public Mediahoustonpublicmedia.org
  6. 6As GOP concerns about Medicaid cuts grow, hard-liners pressure Speaker Mike Johnson on lower deficitsnbcnews.com

9. What Could Change the Odds

Key Catalysts

As of May 27, 2026, House GOP leadership is actively planning a third reconciliation bill (Reconciliation 3.0), aiming to develop a budget blueprint in June 2026 with potential legislative action through the end of July 2026 or into the November/December lame-duck session [1][2][3]. Potential content for this proposed package includes measures to combat fraud, improve the affordability of everyday goods, and supplement defense spending for the fiscal year 2027, potentially including funding for the 'Golden Dome' missile defense system [1][4].
Bullish indicators for the bill include active caucus-level discussions and leadership support for a budget resolution; however, bearish indicators involve skepticism from Senate GOP leadership, slim Republican majorities with potential defections, and a constrained legislative calendar due to the upcoming midterm elections [2][3]. The budget reconciliation process is a specialized, optional tool that allows for expedited Senate consideration by bypassing filibusters with a simple majority vote (51), making it a high-priority vehicle for party-line policy goals in the current political environment [5][6].

Key Dates & Catalysts

  • Expiration: January 01, 2027
  • Closes: January 01, 2027
Sources (6)
  1. 1House GOP still planning for third reconciliation bill - E&E News by POLITICOeenews.net
  2. 2Midterms Pose Reality Check for Third Go-Round on GOP Megabillnews.bgov.com
  3. 3Perfidious Senate GOP Leaders Bait-and-Switch the Right on Reconciliation 3.0 - The Daily Signaldailysignal.com
  4. 4New 2027 Defense Bill Pushes Back on Some Trump Priorities | The Fiscal Timesthefiscaltimes.com
  5. 5The Congressional Budget Process Timelinecongress.gov
  6. 6The Reconciliation Process: Frequently Asked Questions | Congress.gov | Library of Congresscongress.gov