Budget Blog

May 17, 2022 - Washington Report

By Leah Wavrunek posted 05-17-2022 03:45 PM

  

This Week on the Hill  

The House and Senate are in session this week.

The House convened on Monday and over the week will consider multiple bills focused on cybersecurity and veterans, including S. 2520, the State and Local Government Cybersecurity Act of 2021. The chamber will also consider H.R. 7309, the Workforce Innovation and Opportunity Act of 2022, which passed out of committee on a party-line vote.

The Senate convened yesterday and continues consideration of a bill providing $40.1 billion in emergency supplemental appropriations for assistance to Ukraine, following passage by the House last week. The bill no longer includes $500 million, proposed by the administration, to encourage U.S. farmers to boost production of wheat and other crops to help offset global supply problems.

 

HHS Sends Letter to Governors on Public Health Emergency

Last Tuesday the Secretary of Health and Human Services (HHS) and Administrator for the Centers for Medicare and Medicaid Services (CMS) sent a letter to governors regarding the COVID-19 public health emergency (PHE). The letter notes that “we do not yet know when the PHE will end, but the Biden-Harris administration is committed to providing you with at least 60-days’ notice before any expiration or termination of the PHE.” The last PHE extension announcement, which extended the PHE effective April 16, means the PHE will be in place through at least July 15 and at this time, it appears the 60-day window for notifying has passed. The letter also notes the resources released by the department to help states prepare for the return to normal Medicaid operations.

 

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).

  • President Calls on Leaders to Spend Additional ARPA Funds on Public Safety: The President released a fact sheet, calling for state and local leaders to dedicate more ARPA funding to community safety. The fact sheet highlights how $10 billion in ARPA investments have been deployed in public safety and violence prevention, giving examples from state and local governments.
  • ACF Launches Family Violence and Prevention Services Portal: The Administration for Children and Families (ACF) launched a new ARPA grants portal for the Family Violence Prevention Services Act (FVPSA) program. The website features resources including essential deadlines, program instructions, trainings, and other resources to help state, local, and Tribal organizations provide services and support to survivors and their children. A fact sheet on FVPSA ARPA can be found here.
  • Education Sends Letter on Relief Spending Flexibility: The Department of Education sent a letter to AASA, The School Superintendents Association, regarding spending flexibility under ARPA’s Elementary and Secondary School Emergency Relief (ARP-ESSER) Fund. The letter notes statutory deadlines for obligating ARP ESSER funds as well as departmental authority to approve liquidation extension requests. Additional information from AASA can be found here.

 

Administration Actions Related to COVID-19

  • FDA Authorizes Booster for Children Aged 5-11: The Food and Drug Administration (FDA) amended the emergency use authorization for the Pfizer-BioNTech COVID-19 vaccine, authorizing the use of a single booster dose for administration to children 5 through 11 years of age at least five months after completion of a primary series with the Pfizer-BioNTech vaccine. The Centers for Disease Control and Prevention’s Advisory Committee on Immunization Practices (ACIP) will meet Thursday to discuss vaccine boosters.
  • CMS Sends Letter on Stand-Alone Vaccine Counseling in Medicaid and CHIP: The Centers for Medicare and Medicaid Services (CMS) issued guidance on Medicaid and Children’s Health Insurance Program (CHIP) coverage and payment for “stand-alone vaccine counseling.” The policies discussed in the guidance generally apply beginning December 2, 2021, which was when they were first announced.
  • ACF Publishes Corrections to Head Start COVID-19 Fiscal and Administrative Flexibilities: The Administration for Children and Families (ACF) published a correction to previous guidance on COVID-19 fiscal and administrative flexibilities. The guidance was corrected to note certain waivers are in effect until a memo from the Office of Management and Budget (OMB) on disaster relief flexibilities expires or is rescinded.
  • Administration Announces Additional Free At-Home Tests Available: The administration announced that gov is now open for a third round of ordering. U.S. households are now able to order an additional eight free at-home tests, bringing the total number of free tests available to each household since the start of the program to 16.

 

IIJA Implementation Resources Released

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

  • The National Telecommunications and Information Administration (NTIA) launched the “Internet for All” initiative, which will invest $45 billion to expand broadband access. The Internet for All programs launched with three Notices of Funding Opportunity: Broadband Equity, Access, and Deployment (BEAD) Program ($42.5 billion); Enabling Middle Mile Broadband Infrastructure Program ($1 billion); and State Digital Equity Act programs ($1.5 billion). To participate in the BEAD program, states and other eligible entities must submit a letter of intent and a planning funds budget, which will unlock $5 million in planning funds and allow states to begin creating their five-year action plan. Each participating state is guaranteed a minimum $100 million allocation, with additional funding determinations made based on the forthcoming coverage maps from the Federal Communications Commission. Additional resources include a fact sheet, a blog on how public input shaped the grant programs, and a population viewer from the Census Bureau related to the State Digital Equity Act programs.
  • The Department of the Interior (DOI) announced that 125 ecosystem restoration projects for more than 20 states, Tribes and territories will receive nearly $68.4 million in fiscal year 2022 funding from the IIJA. Funding will help reduce wildfire risk, restore mined lands, restore recreation sites, and restore ecosystems by detecting and eradicating invasive species. The announcement also includes $1.8 million available for grants to support measures that prevent the introduction or spread of invasive species; proposals are due June 22.
  • The Environmental Protection Agency (EPA) awarded $254.5 million in brownfields grants to 265 communities. The announcement includes approximately $180 million from the IIJA along with more than $75 million from fiscal year 2022 appropriations. The funding includes $112.8 million for Assessment Grants, $18.2 million for Cleanup Grants, $16.3 million for Revolving Loan Fund grants and $107 million for high-performing Revolving Loan Fund Grant recipients. Additional information can be found here.
  • The Department of Transportation (DOT) announced that the application process is open for communities of all sizes to apply for $1 billion in fiscal year 2022 funding to help them ensure safe streets and roads. The IIJA’s Safe Streets and Roads for All discretionary grant program provides dedicated funding to support regional, local, and Tribal plans, projects and strategies that will prevent roadway deaths and serious injuries. Applications are due by September 15.
  • The Department of Energy (DOE) released a Request for Information seeking input on the structure of the $2.5 billion Transmission Facilitation Program, created in the IIJA to help build out critical new transmission lines across the country. This is one part of the new Building a Better Grid Initiative. Comments are due by June 13.
  • The Department of Energy (DOE) issued a Request for Information seeking public input on the structure of a $505 million long duration energy storage initiative to increase the availability and delivery of affordable, reliable clean electricity. The initiative will invest approximately $505 million over four years to validate grid-scale long duration energy storage technologies and enhance integration capabilities. Comments are due by June 16.
  • The White House announced a new Permitting Action Plan intended to strengthen and accelerate federal permitting and environmental reviews. The action plan is built on five key elements: early cross-agency coordination; establishing clear timeline goals and tracking key project information; engaging in early and meaningful outreach with states, Tribal nations, territories and local communities; improving agency responsiveness, technical assistance and support; and using agency resources and environmental reviews to improve impact.
  • The administration released the collection of “Infrastructure School” webinars held throughout February and March on major areas of investment in the IIJA.
  • The Department of Housing and Urban Development (HUD) announced that benefits received from the IIJA’s Affordable Connectivity Program (ACP) do not count as income for determining family rent or impact eligibility for HUD assistance.
  • The Federal Highway Administration (FHWA) issued guidance on the IIJA requirement that state departments of transportation must consider extreme weather and resilience as part of the life-cycle planning and risk management analyses within a state asset management plan (TAMP), including deadlines and expected information to be submitted.
  • The Federal Railroad Administration (FRA) established the new Corridor Identification and Development (ID) Program, the first step to transform America’s passenger rail network. The IIJA included $1.8 billion for the program and directed the Secretary of Transportation to establish the program within 180 days to give public entities a formal mechanism to partner with FRA to develop proposals that will expand, enhance or restore passenger rail service in their communities. FRA will be soliciting formal proposals for the program within this calendar year.
  • The administration released a series of resources and highlights marking six months since passage of the IIJA.

 

OMB Releases 2022 Compliance Supplement

On May 11 the Office of Management and Budget (OMB) released the 2022 Compliance Supplement. The 2022 Supplement includes seven new programs (five of which are funded by the American Rescue Plan Act (ARPA) and the Consolidated Appropriations Act, 2021). It includes, for the first time, a program from the Small Business Administration (i.e., the Shuttered Venue Operators Program) and it provides updated audit guidance for many other programs. This 2022 Supplement is effective for audits of fiscal years beginning after June 30, 2021 and supersedes the 2021 Compliance Supplement (dated August 2021) and its Addenda (dated December 2021 and January 2022).

 

Administration Releases Plan to Address Housing Supply, Prices

On Monday the White House announced new actions to address housing supply and housing costs through the Housing Supply Action Plan. The plan includes legislative and administrative actions intended to help close the housing supply shortfall in five years. Actions included in the plan address: rewarding jurisdictions that reformed zoning and land-use policies with higher scores in certain federal grant processes; deploying new financing mechanisms to build and preserve more housing where financing gaps exist; expanding and improving existing forms of federal financing; and working with the private sector to address supply chain challenges and improve building techniques to finish construction in 2022 on the most new homes in any year since 2006. The plan also calls for leveraging American Rescue Plan Act (ARPA) funds for investments in affordable housing, noting that to date, nearly 570 jurisdictions have committed over $11.7 billion to housing-related activities.

 

House Advances CSBG Modernization Bill

On Friday the House voted 246 to 169 to approve H.R. 5129, the Community Services Block Grant Modernization Act of 2022. The Community Services Block Grant (CSBG) program was last updated in 1998 and the bill would reauthorize the program for ten years while making updates to further reduce poverty. Updates include the 10 year reauthorization at an increased level of $1 billion for the first five years, permanently raising income eligibility to 200 percent of the poverty line, and requiring federal and state training and technical assistance to support developing and promoting evidence-based approaches to reducing poverty. A fact sheet can be found here and a summary here. The bill now goes to the Senate for consideration.

 

Administration, Congress Announce Actions to Address Formula Shortage

Over the last week the administration has announced steps to address the current shortage of infant formula. On Friday the U.S. Department of Agriculture (USDA) sent a letter to state health commissioners to reiterate the flexibilities the department has made available to all Special Supplemental Nutrition Program for Women, Infants and Children (WIC) state agencies and to urge all states to take additional action to make it easier for families to get the formula they need. To date, USDA has issued more than 200 regulatory waivers to WIC state agencies. On Monday, the Food and Drug Administration (FDA) announced a guidance that outlines increased flexibilities to encourage importation of certain infant formula products and also announced an agreement with Abbott Nutrition that is expected to ultimately result in the reopening of its closed production facility and an increase of infant formula products. The House is also expected to vote this week on a bill to grant emergency authority to the WIC program to address supply chain disruptions and recalls while House Appropriations Committee Chair Rosa DeLauro (D-CT) introduced a $28 million emergency supplemental appropriations bill to provide FDA with additional resources.

 

FCC Circulates Proposal to Make Wi-Fi on School Buses Eligible for E-Rate Funding

On Wednesday Federal Communications Commission (FCC) Chairwoman Jessica Rosenworcel announced a proposal to allow the use of federal funding for Wi-Fi in school buses. If adopted, the declaratory ruling would allow E-Rate program funding to equip school buses with Wi-Fi and help close the homework gap faced by students. The proposal would clarify that use of Wi-Fi, or similar access point technologies, on school buses serves an educational purpose and the provision of such service is therefore eligible for E-Rate funding.

 

CMS Releases Medicaid Provider Claims Final Rule

Last week the Centers for Medicare and Medicaid Services (CMS) released the final rule for reassignment of Medicaid provider claims. Specifically, this final rule explicitly authorizes states to make payments to third parties on behalf of individual practitioners, for individual practitioners’ health insurance and welfare benefits, skills training, and other benefits customary for employees, if the individual practitioner consents to such payments on their behalf.

 

EPA Announces $1.9 Billion in SRF for Water Infrastructure Upgrades

On Friday the Environmental Protection Agency (EPA) announced $1.9 billion in grant funding to the State Revolving Funds (SRF) to accelerate progress on water infrastructure projects. In 2022, EPA is providing approximately $3.2 billion to the Clean Water SRFs, including $1.2 billion in the new base federal grant funding being announced and $2 billion through the Infrastructure Investment and Jobs Act (IIJA). EPA is also providing $6.4 billion to the Drinking Water SRFs, including $728 million in the new base federal grant funding announced and $5.7 billion through the IIJA.

 

DHS Announces $1.6 Billion in Fiscal Year 2022 Preparedness Grants

On Friday the Department of Homeland Security (DHS) announced $1.6 billion for eight fiscal year 2022 preparedness grant programs. These programs provide critical funding to help state and local officials prepare for, prevent, protect against, and respond to acts of terrorism and other hazards. The department designated two new national priority areas for the fiscal year 2022 State Homeland Security Program and Urban Area Security Initiative grant programs: Community Preparedness and Resilience; and Election Security. The other national priority areas for fiscal year 2022 include cybersecurity, soft targets and crowded places, intelligence and information sharing, and domestic violent extremism. And for the first time, DHS is increasing funding to Law Enforcement Terrorism Prevention Activities from a statutory minimum of 25 percent to 30 percent, resulting in a $51.5 million increase over the prior year.

 

HUD Announces $10.3 Billion for Housing and Community Development Activities

Today the Department of Housing and Urban Development (HUD) announced $10.3 billion in fiscal year 2022 formula grants to communities across the country for housing and community development activities. The funding includes $3.3 billion for the Community Development Block Grant (CDBG), $1.5 billion for HOME Investment Partnerships, and $3.2 billion for Capital Fund Program awards. A list of recipients for many of the grants, including CDBG, can be found here.

 

USDA Announces Approximately $6 Billion for Producers Impacted by Natural Disasters

Yesterday the U.S. Department of Agriculture (USDA) announced that commodity and specialty crop producers impacted by natural disaster events in 2020 and 2021 will soon begin receiving emergency relief payments totaling approximately $6 billion to offset crop yield and value losses. The Extending Government Funding and Delivering Emergency Assistance Act, signed into law in September 2021, included $10 billion in assistance to agricultural producers. USDA recently made payments to ranchers impacted by drought and wildfire and an additional program, the Milk Loss Program and On-Farm Stored Commodity Loss Program, will be announced in a future rule.

 

For Your Information

Agencies Sign Agreement on Sharing of Broadband Information

The Federal Communications Commission (FCC), National Telecommunications and Information Administration (NTIA), U.S. Department of Agriculture (USDA) and Department of the Treasury announced an interagency agreement to share information and collaborate regarding the collection and reporting of certain data and metrics relating to broadband deployment. As part of the signed agreement, each federal agency partner will share information about projects that have received or will receive funding from their respective federal funding sources.

 

DOL Releases Information on Fiscal Year 2022 State Workforce Agency UI Planning Targets

The Department of Labor (DOL) released Unemployment Insurance Program Letter No. 25-21, Change 1. The letter is intended to provide states with the revised and final fiscal year 2022 Unemployment Insurance (UI) state administration base resource planning targets, general guidelines for resource planning, and an explanation of how the department allocates base resources among the states. Target amounts were revised downward based on actual allocations passed in the fiscal year 2022 appropriations bill.

 

NPS Announces $73.6 Million for Historic Preservation Grants

The National Park Service (NPS) announced the distribution of $57.7 million in historic preservation grants for states, territories and partnering nations and $16 million to more than 200 Tribal historical preservation offices. These funds are appropriated annually by Congress from the Historic Preservation Fund. A list of awards by state and territory is included in the announcement.

 

USDA and EDA Release Resource Guide to Boost Economic Development in Rural Communities

The U.S. Department of Agriculture (USDA) and U.S. Economic Development Administration (EDA) unveiled a joint resource guide to help community organizations access agency resources to boost economic development in rural America. The resource guide outlines programs and services that can be used to advance community and economic development in rural communities through four key focus areas: planning and technical assistance; infrastructure and broadband expansion; entrepreneurship and business assistance; and workforce development and livability.

 

Recently Released Reports

State Investment of the $26 Billion Opioid Settlement

The Council on State Governments

State Public Pension Fund Returns Expected to Decline

The Pew Charitable Trusts

Federal Assistance for Wildfire Response and Recovery

Congressional Research Service

 

Economic News

Unemployment Claims Reported for Week Ending May 7

The U.S. Department of Labor released unemployment insurance weekly claims data last Thursday that showed for the week ending May 7, the advance figure for seasonally adjusted initial claims was 203,000. This is an increase of 1,000 from the previous week’s revised level, which was revised up by 2,000 from 200,000 to 202,000. The 4-week moving average was 192,750, an increase of 4,250 from the previous week's revised average of 188,500. The advance seasonally adjusted insured unemployment rate was 1.0 percent for the week ending April 30, unchanged from the previous week’s unrevised rate. The advance number of actual initial claims under state programs, unadjusted, totaled 191,803 in the week ending May 7, a decrease of 6,554 (or -3.3 percent) from the previous week.

 

Consumer Price Index Increased in April as Real Hourly Earnings Declined

The U.S. Bureau of Labor Statistics released new data on the Consumer Price Index for All Urban Consumers (CPI-U) for April, showing the CPI-U increased 0.3 percent on a seasonally adjusted basis after rising 1.2 percent in March. Over the last twelve months, the all items index increased 8.3 percent before seasonal adjustment. The index for all items less food and energy rose 0.6 percent in April, as the food index rose 0.9 percent and the energy index declined, with the index for gasoline falling 6.1 percent. For the 12 months ending April, the index for all items less food and energy rose 6.2 percent, while the energy index rose 30.3 percent and the food index increased 9.4 percent. Meanwhile, real average hourly earnings for all employees decreased 0.1 percent from March to April, seasonally adjusted. This result stems from an increase of 0.3 percent in average hourly earnings combined with an increase of 0.3 percent in the CPI-U.