Federal Newscast

Both House and Senate lawmakers are looking to eliminate the IRS’ free online tax filing platform. The Senate Finance Committee is proposing to axe Direct File as part of its contribution to the budget reconciliation bill. The House passed its version of the so-called Big Beautiful Bill last month which would also eliminate the Direct File program. Direct File had nearly 300,000 users during this year’s tax filing season and saw higher favorability scores compared to last year’s pilot. 

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Congressional Democrats are sounding the alarm over reports that a federal contractor is helping the Trump administration build a “mega-database” of sensitive government records. Senate Finance Committee Ranking Member Ron Wyden and Congresswoman Alexandria Ocasio-Cortez are leading their colleagues in a letter to the company Palantir. The New York Times reports the company is building a single, searchable database of taxpayer records across multiple agencies. The lawmakers are asking for a full list of Palantir’s federal contracts. 

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The Postal Service strikes a deal with another one of its unions. Members of the National Rural Letter Carriers’ Association approved a tentative contract that lasts through 2027. About 67% of voting members approved the tentative agreement. Next up, the American Postal Workers Union which votes whether to approve its contract or not next month. Members of another union, the National Association of Letter Carriers voted against a tentative agreement with USPS in January. A third-party arbitrator eventually struck a deal with both parties.

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The Interior Department and the Forest Service are facing a deadline to consolidate their wildland fire programs. President Trump signed an executive order last week giving the agencies 90 days to combine their two offices into one. The White House says it will make wildland fire prevention and response efforts more efficient. But some federal wildland firefighters question the need for consolidating the programs when a larger response is already needed. The Forest Service lost about 1,400 qualified wildland firefighters over the last several months amid the Trump administration’s workforce cuts.

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Participants in the Thrift Savings Plan will soon see a few changes to the TSP’s Lifecycle, or “L,” Funds. Starting June 30th, the Federal Retirement Thrift Investment Board will add an “L 2075” Fund. That's meant for any current or future federal employees who plan to retire during or after the year 2073. The TSP board will also be rolling over the current “L 2025” Fund into its broader Income Fund. 

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Civilian agencies have spent nearly 23% less during the first eight months of 2025 as compared to the same time period in 2024. The Department of DOGE Services says that means non-defense spending has been reduced by almost $25 billion. Overall non-defense agencies have obligated over $85 billion in 2025 down from $110 billion at this point last year. Some of the spending reduction comes from the cancellation of contracts, which DOGE says agencies have terminated more than 11,000.  

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The Agriculture Department has cancelled hundreds of contracts under the Trump administration … including one that helped households locate food assistance programs. The nonprofit Hunger Free America says it ran an “information clearinghouse” of food assistance programs for USDA for more than a decade. But it claims in a lawsuit that USDA terminated the contract last month. 

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The Postal Service is falling into pattern raising stamp prices each January and July. But its regulator is considering limits to those price increases. A proposed rule from the Postal Regulatory Commission would cap UPSP to only raising prices once per year. The regulator gave USPS the freedom to set mail prices higher than the rate of inflation in 2020 when the agency was at risk of running out of cash. USPS is planning to set the price of a first-class Forever stamp to 78 cents next month.

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A separation health assessment administered to more than 50,000 service members found that about 67 percent of troops screened positive for at least one mental health condition. Post-traumatic stress disorder and depression were among the most common issues identified. A government watchdog found that over 50 percent of service members declined referrals to the DoD’s inTransition program that provides mental health resources during transition periods. DoD officials told the Government Accountability Office that many factors may contribute to the high rate of positive screenings among separating service members, including that many intend to file disability claims.

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More federal employees filed retirement papers with OPM in May than in the last three months. OPM says it received more than 15,000 claims last month, driving the backlog up over 21,000. The processing time for these retirement claims remain consistent at 49 days on average in May and 52 days on average for the entire 2025. The increase in applications comes as OPM is requiring agencies to send retirement paperwork only in digital formats by July 15. OPM launched two new tools this week to improve the retirement services process. One is a new platform for agency HR and payroll providers and another to modernize the Electronic Official Personnel Folder (eOPF) platform.

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