Budget Blog

December 28, 2021 - Washington Report

By Leah Wavrunek posted 12-28-2021 03:42 PM

  

This Week on the Hill  

The House and Senate are not in session.

 

President Issues Memorandum on Assistance for COVID-19 Testing Sites

On Monday the President issued a Memorandum for the Secretary of Health and Human Services, the Secretary of Homeland Security and the Administrator of the Federal Emergency Management Agency on Maximizing Assistance to Respond to COVID-19. The memorandum indicates that with respect to a request to the Federal Emergency Management Agency (FEMA) from any state, Tribal or territorial government for direct federal assistance to establish or expand COVID-19 testing sites, the Administrator of FEMA shall issue a mission assignment to the Department of Health and Human Services (HHS), on a fully reimbursable basis, to provide testing sites, launched and operated by HHS in close coordination with state, local, Tribal and territorial public health departments. FEMA shall fund 100 percent of the cost of activities associated with the mission assignments to HHS to provide COVID-19 testing sites as authorized by applicable sections of the Stafford Act.

 

Treasury Posts Initial SLFRF Recipient Reports

The Treasury Department posted initial reports collected by recipients of State and Local Fiscal Recovery Funds (SLFRF), authorized by the American Rescue Plan Act (ARPA). Treasury has published completed Interim Reports received as of September 17, 2021 and Recovery Plan Performance Reports submissions received as of December 15, 2021. Information posted by Treasury states that “Treasury is not pre-approving projects. Releasing the dataset of Interim Reports and Recovery Plans does not indicate that Treasury has made a determination about project eligibility.”

 

President Signs $768 Billion Fiscal Year 2022 Defense Policy Bill

On Monday the President signed S. 1605, the National Defense Authorization Act for Fiscal Year 2022 (NDAA). The bill authorizes $768.2 billion in defense spending, an increase of $25 billion over the President’s request. The legislation authorizes a $740 billion base budget for the Defense Department, $27.8 billion for nuclear weapons programs under the Department of Energy and $368 million for defense-related activities in other departments. The NDAA authorizes a 2.7 percent pay increase for service members, makes changes to the Uniform Code of Military Justice to combat sexual assault in the military, and adds several requirements around testing and reporting for PFAS. A summary of the legislation can be found here and a joint explanatory statement here. A signing statement from the President addressing concerns with certain provisions of the bill can be found here.  

 

COVID-19 Relief Implementation

The following guidance and information was recently released to implement provisions in the Coronavirus Aid, Relief, and Economic Security Act (CARES Act), the Coronavirus Response and Relief Supplemental Appropriations Act, 2021 (Division M of H.R. 133, the Consolidated Appropriations Act, 2021), and the American Rescue Plan Act of 2021 (ARPA).

 

Administration Actions Related to COVID-19

  • CDC Shortens Recommended Isolation and Quarantine Period for General Population: The Centers for Disease Control and Prevention (CDC) shortened the recommended time for isolation from 10 days for people with COVID-19 to 5 days, if asymptomatic, followed by 5 days of wearing a mask when around others. CDC also updated the recommended quarantine period for those exposed to COVID-19.
  • CDC Issues Emergency Guidance to Help Healthcare Systems Prepare for Omicron: The Centers for Disease Control and Prevention (CDC) released updated guidance for isolation and quarantine for healthcare workers, decreasing their isolation time after infection with COVID-19. CDC is also releasing an update to guidance for contingency and crisis management in the setting of significant healthcare worker shortages. These guidelines apply only to the healthcare workforce and may be revised to continue to protect both healthcare workers and patients as additional information on the Omicron variant becomes available.
  • FDA Issues Emergency Use Authorization to Two Antiviral Treatment Pills: The Food and Drug Administration (FDA) issued an emergency use authorization (EUA) for Pfizer’s Paxlovid for the treatment of mild-to-moderate COVID-19 in adults and pediatric patients (12 years of age or older weighing at least 88 pounds) who are at high risk for progression to severe COVID-19, including hospitalization or death. FDA also issued an EUA for Merck’s molnupiravir for treatment of COVID-19 in adults for whom alternative COVID-19 treatment options authorized by the FDA are not accessible or clinically appropriate; it is not authorized for use in patients younger than 18 years of age and not recommended for use during pregnancy.
  • Administration Extends Student Loan Pause to May 1: The Department of Education announced a 90-day extension of the pause on student loan repayment, interest and collections through May 1, 2022. The department will continue its work to transition borrowers smoothly back into repayment, including by improving student loan servicing. A statement from the President on the extension can be found here.
  • Supreme Court to Hear Oral Arguments on Vaccine Requirements: The Supreme Court announced it would hold oral arguments on January 7 on two federal policies: a vaccine-or-test mandate for large employers and a vaccine requirement for health care workers at facilities that receive federal funding.
  • DOL Awarding $8 Million to Expand Apprenticeships in Sectors Affected by Pandemic: The Department of Labor (DOL) announced the award of more than $8 million in contract investments to four national Industry Intermediaries to expand the use of Registered Apprenticeships in sectors affected by the pandemic. The funding will target sectors including the care economy, electric power generation/distribution, key supply chains, and operations for supply chain distribution.
  • HHS Issues Guidance to Boost Accessibility and Equity in COVID-19 Vaccine Programs: The Department of Health and Human Services (HHS) Office for Civil Rights issued guidance on federal legal standards prohibiting race, color and national origin discrimination in COVID-19 vaccination programs. The guidance includes a list of best practices to advance and improve equitable vaccine administration and links to additional resources.
  • HHS Announces Record Open Enrollment Numbers: The Department of Health and Human Services (HHS) released data showing that this year’s Open Enrollment Period is outpacing all previous years, as a historic high of more than 13.6 million people already enrolled in health insurance coverage for 2022. ARPA included provisions to make coverage more affordable and accessible; 92 percent of people in HealthCare.gov states who signed up for plans through December 15 will receive premium tax credits for 2022 coverage.
  • Education Releases FAQs on COVID’s Impact on Accountability Systems: The Department of Education released a set of frequently asked questions (FAQs) on the impact of COVID-19 on 2021-2022 accountability systems required under the Elementary and Secondary Education Act of 1965 (ESEA). This draft for public comment is intended to support state and local education agencies and schools as they implement accountability and school improvement requirements, following waivers due to the pandemic. The department also released a template for addendum to the ESEA consolidated state plan due to the COVID-19 national emergency.
  • HHS Releases State/Territory Monoclonal Antibody Distribution Allocations: The Department of Health and Human Services (HHS) released the distribution determinations for the monoclonal antibody therapeutic sotrovimab, which early data suggests retains activity against the Omicron variant. The department prepared approximately 55,000 doses for distribution as early as December 21. The federal government’s supply is limited, and additional doses of the product will not be available until the week of January 3.

 

National Health Spending Grows by 9.7 Percent in 2020

The Centers for Medicare and Medicaid Services’ Office of the Actuary released data showing national health spending totaled $4.1 trillion in 2020, amounting to a 9.7 percent increase over the prior year. Federal spending grew from a 5.9 percent increase in 2019 to a 36 percent increase in 2020 while non-federal spending grew 1.9 percent with the COVID-19 pandemic driving the fastest growth in national health spending since 2002. The share of the gross domestic product (GDP) devoted to health increased from 17.6 percent in 2019 to 19.7 percent in 2020. Medicaid spending increased 9.2 percent to $671.2 billion in 2020 compared to 3.0 percent growth in 2019, primarily driven by increased enrollment due to the pandemic. Further details and tables can be found here.

 

IIJA Implementation Resources Released

Federal agencies and stakeholders continue to release implementation resources pertaining to the Infrastructure Investment and Jobs Act (IIJA).

  • The Department of Energy (DOE) announced the establishment of the Office of Clean Energy Demonstrations. The IIJA provides more than $20 billion to establish the office and support clean energy technology demonstration projects in areas including clean hydrogen, carbon capture, grid-scale energy storage, small modular reactors, and more.
  • The U.S. Department of Agriculture (USDA), Department of the Interior (DOI) and Federal Emergency Management Agency (FEMA) announced the establishment of the Wildland Fire Mitigation and Management Commission. The commission will include representation from federal, state, Tribal, county and municipal governments as well as non-governmental stakeholders.
  • The Bipartisan Policy Center (BPC) compiled a table of major competitive grants included in the IIJA to help stakeholders navigate available and eligible opportunities.
  • The National Governors Association (NGA) sent a letter to the Office of Management and Budget (OMB) outlining IIJA regulatory priorities. State and territorial priorities for consideration during development of guidance and regulations include flexibility, immediate clarity in allowable uses, reasonable and achievable timelines, utilizing existing programs, and advance notice of any changes to guidance and regulation.

 

FHWA Announces $1.39 Billion in Emergency Relief for Road and Bridge Repairs

Last week the Federal Highway Administration (FHWA) announced it will award $1.39 billion in Emergency Relief (ER) funds to help 42 states, the District of Columbia, Puerto Rico and the U.S. Virgin Islands make repairs to roads and bridges damaged by storms and other events. The ER program provides funding reimbursement to states, territories, federal land management agencies and Tribal governments for the reconstruction, restoration, and repair of federal-aid and federally-owned transportation facilities that have suffered damage from natural disasters or catastrophic failure from external causes.

 

DOT Announces Over $241 Million for Ports

On Thursday the Department of Transportation (DOT) announced the award of more than $241 million in discretionary grant funding for 25 projects to improve port facilities in 19 states and one territory through the Maritime Administration’s Port Infrastructure Development Program. The program provides planning and capital financing and project management assistance to improve ports’ capacity and efficiency. The projects that were awarded grants include coastal seaports, Great Lakes ports, and inland river ports and address priorities related to job creation, climate change, and environmental justice impacts.

 

Administration Announces Nearly $10 Million to Expand High-Speed Internet Access to Tribal Nations

On Wednesday the administration released a fact sheet on nearly $10 million in resources made available across multiple agencies to connect Tribal nations to reliable, high-speed internet. First, the Commerce Department’s Economic Development Administration (EDA) awarded $3.2 million to connect a Tribe in Colorado to the internet while the National Telecommunications and Information Administration (NTIA) awarded more than $942,000 to Tribes in Arizona and Wisconsin to improve internet speed and connectivity. The Treasury Department announced the first set of Capital Projects Fund awards in Alaska, California and Oklahoma to provide Tribal members with laptops, tablets and upgraded community centers while the U.S. Department of Agriculture (USDA) awarded more than $4.6 million through its Community Connect Program to provide high speed internet connections to Tribal lands in Alaska, Arizona, Iowa and New Mexico.

 

DOJ Announces the Awarding of Grants Across Multiple Programs

Last week the Department of Justice (DOJ) announced a series of grant awards across multiple departmental programs. The announcements include: $210 million to support forensic science; $100 million to support youth; $34 million to support community crisis response; $125 million under the STOP School Violence Act; $87 million to combat human trafficking and help victims; $37 million to support innovations in policing; $444 million to support violence intervention efforts; $40 million to improve services for crime victims; $38 million for justice system reforms; $12 million for data sharing; $141 million to protect children; $110.7 million to reduce recidivism; and $300 million to address substance use disorders. Additional information can be found here.

 

FEMA Releases 2021 National Preparedness Report

The Federal Emergency Management Agency (FEMA) recently released the 2021 Preparedness Report that summarizes progress made and challenges that remain in building and sustaining the capabilities needed to prevent, protect against, mitigate, respond to, and recover from threats, hazards and incidents. For this report, FEMA used the events of 2020 to draw broader conclusions about national risk and capabilities and identified management opportunities to build those capabilities and reduce risk. Management opportunities are new to the report and include factors that federal, state, local, Tribal and territorial governments and organizations could take advantage of when developing strategies to enhance their capabilities.

 

FEMA Extends Assistance to Firefighters Grants Application Period, Releases Funding Notice for SAFER Grants

The Federal Emergency Management Agency (FEMA) is extending the application period for the Fiscal Year 2021 Assistance to Firefighters Grants to January 21, 2022 due to technical issues. The notice of funding opportunity and other application materials can be found here. FEMA also released the application for fiscal year 2021 Staffing for Adequate Fire and Emergency Response (SAFER) grants. The program provides funding directly to fire departments and volunteer firefighter interest organizations to help increase or maintain the number of trained firefighters available in their communities. Applications are due by February 4, 2022.

 

Census Bureau Releases Data on State Government Finances, Small Area Income and Poverty Estimates

The Census Bureau recently released two data sets. First, the bureau released data tables on the Annual Survey of State Government Finances for fiscal year 2020. These statistics provide a summary of the finances of the state governments, as well as data for individual states and details on revenue by source, expenditure by object and function, indebtedness by term, and assets by purpose. Second, the bureau released 2020 data under the Small Area Income and Poverty Estimates program. The statistics are used to allocate funding under Title I of the Elementary and Secondary Education Act (ESEA).

 

EPA Issues Final Rule on Collecting Data for 29 Additional PFAS

Last week the Environmental Protection Agency (EPA) finalized a rule to establish nationwide monitoring for 29 per-and polyfluoroalkyl substances (PFAS) and lithium in drinking water. EPA uses the Unregulated Contaminant Monitoring Rule (UCMR) to monitor for priority unregulated contaminants in drinking water every five years; this new rule will collect new data on 29 PFAS that is needed to improve EPA’s understanding of the frequency and magnitude at which these chemicals are found in the nation’s drinking water systems. Additionally, expanded monitoring in the rule will improve EPA’s ability to conduct state and regional assessments of contamination. Additional information can be found here.

 

ACF Provides Update on CSBG Fiscal Year 2022 Funding, Timing

The Administration for Children and Families (ACF) recently published a Dear Colleague letter to provide an update on the status of the most recent continuing resolution and Community Services Block Grant (CSBG) fiscal year 2022 second quarter funding. The current continuing resolution (CR) funding the federal government was signed on December 3 and runs through February 18, 2022. ACF anticipates that the full allotment for second quarter funds will be available in late-January. The CR also extended the state’s authority to revise the income limit for eligibility from 125 to 200 percent of the federal poverty line as authorized by the Coronavirus Aid, Relief and Economic Security Act (CARES Act); this extension is through February 18, 2022.

 

For Your Information

DOL Releases Additional FY2022 WOTC Funding Allotments

The Department of Labor (DOL) released Training and Employment Guidance Letter No. 03-21, Change 1 to provide additional fiscal year 2022 Work Opportunity Tax Credit (WOTC) funding allotments of $3.9 million and application requirements for State Workforce Agencies based on funding appropriated through the current continuing resolution (CR). Grantees must submit applicable forms within 30 calendar days from the issuance date of this letter.

 

FHWA Releases Fiscal Year 2022 Apportionments, Obligation Limitation, and Sequestration Information

The Federal Highway Administration (FHWA) released fiscal year 2022 apportionments, obligation limitation, and sequestration of federal-aid highway funding notices under the current continuing resolution, which runs through February 18, 2022. The CR sets an overall limitation on obligations at an annual rate for operations of $46.4 billion for fiscal year 2022; this annual rate for operations is equal to the obligation limitation made available in fiscal year 2021.

 

FWS Awards More Than $20 Million to Help Coastal Community Resilience

The U.S. Fish and Wildlife Service (FWS) awarded more than $20 million to support 25 projects in 13 coastal states to protect, restore or enhance more than 61,000 acres of coastal wetlands and adjacent upland habitats under the National Coastal Wetlands Conservation Grant Program. State, local and Tribal governments, private landowners, conservation groups and other partners will contribute more than $17.6 million in additional funds to these projects.

 

NTIA National Broadband Availability Map Now Includes 38 States and Two Territories

The National Telecommunications and Information Administration (NTIA) announced it has added Nevada, Louisiana, American Samoa and Puerto Rico to its list of participants in the National Broadband Availability Map (NBAM). To date, the map includes 38 states, two U.S. territories, and five federal agencies. The mapping platform provides users, including administrators from the 40 participating states and territories, with access to the NBAM and its data to better inform broadband projects and funding decisions in their states.

 

EPA Releases CWSRF Best Practices Guide

The Environmental Protection Agency (EPA) released the Clean Water State Revolving Fund (CWSRF) Best Practices Guide for Financing Nonpoint Source Solutions. The purpose of the guide is to share the collective wisdom from those states that have achieved success in this area and the guide is designed to help state staff better align and integrate their state’s CWSRF and nonpoint source management programs.

 

Recently Released Reports

States Plan for the End of the Medicaid Continuous Coverage Requirement

National Academy for State Health Policy

Federal Spending Transparency: Opportunities Exist for Treasury to Further Improve USAspending.gov's Use and Usefulness

U.S. Government Accountability Office

Expanding First Response: A Toolkit for Community Responder Programs

The Council of State Governments Justice Center

 

 

Economic News

Unemployment Claims Reported for Week Ending December 18

The U.S. Department of Labor released unemployment insurance weekly claims data last Thursday that showed for the week ending December 18, the advance figure for seasonally adjusted initial claims was 205,000. This is unchanged from the previous week’s revised level, which was revised down by 1,000 from 206,000 to 205,000. The 4-week moving average was 206,250, an increase of 2,750 from the previous week's revised average. The advance seasonally adjusted insured unemployment rate was 1.4 percent for the week ending December 11, unchanged from the previous week’s unrevised rate. The advance number of actual initial claims under state programs, unadjusted, totaled 254,006 in the week ending December 18, a decrease of 11,686 (or -4.4 percent) from the previous week. In addition, for the week ending December 18, 33 states reported 1,550 initial claims for Pandemic Unemployment Assistance.

 

Real GDP Increased in 37 States in Third Quarter

Real gross domestic product (GDP) increased in 37 states and the District of Columbia in the third quarter of 2021, as real GDP for the nation increased at an annual rate of 2.3 percent, according to statistics released by the Bureau of Economic Analysis. The percent change in real GDP in the third quarter ranged from 6.0 percent to -3.3 percent. Real GDP increased in 13 of the 21 industry groups for which BEA prepares quarterly state estimates; professional, scientific, and technical services; finance and insurance; and government and government enterprises were the leading contributors to the increase in real GDP nationally.

 

State Personal Income Increased 2.6 Percent in Third Quarter

The Bureau of Economic Analysis (BEA) released data showing that state personal income increased 2.6 percent at an annual rate in the third quarter of 2021 after decreasing 20.2 percent in the second quarter. The percent change in personal income across all states ranged from 6.7 percent to -4.3 percent. In the third quarter of 2021, increases in earnings and property income (dividends, interest and rent) more than offset a decrease in transfer receipts. The decrease in transfer receipts was due to decreases in state unemployment insurance compensation and all other transfer receipts.

 

BEA Releases GDP by County for 2020 Estimates

The Bureau of Economic Analysis (BEA) released estimates highlighting that real gross domestic product (GDP) increased in 864 counties, decreased in 2,234 counties, and was unchanged in 14 counties in 2020. GDP is the value of goods and services produced within a county. The percent change in real GDP ranged from 91.0 percent to -29.0 percent. The estimates are broken down by large, medium and small counties and also highlights that the full economic effects of the COVID-19 pandemic cannot be quantified in the local area GDP estimates, because the impacts are generally embedded in source data and cannot be separately identified.