Budget Blog

June 21, 2022 - Washington Report

By Leah Wavrunek posted 06-21-2022 04:08 PM

  

This Week on the Hill  

The House and Senate are in session this week.

The House convenes today and will consider 11 bills. For Wednesday and the balance of the week, the House will consider seven bills including H.R. 7666, Restoring Hope for Mental Health and Well-Being Act of 2022. The bill reauthorizes multiple substance use and mental health grants while also expanding access to treatment. The Senate convenes today and will be in session for the week as negotiations continue on bipartisan firearms legislation. According to media reports, bill text could be released as soon as today.

 

Treasury Updates SLFRF Reporting Guidance

On Friday the Treasury Department released Version 4.1 of the Compliance and Reporting Guidance for the Coronavirus State and Local Fiscal Recovery Funds (SLFRF). According to the Revision Log, this version addresses updated clerical errors in Ineligible Activities: Tax Offset Provision. Additional information on reporting and compliance responsibilities can be found here.

 

FEMA Releases COVID-19 Public Assistance Programmatic Deadlines Policy

On Friday the Federal Emergency Management Agency (FEMA) released the COVID-19 Public Assistance (PA) Programmatic Deadlines policy. The President authorized provision of PA at 100 percent federal funding through July 1, 2022. The policy establishes interim programmatic and implementation deadlines across all COVID-19 emergency and major disaster declarations and describes applications of the 100 percent cost share vs. the 90 percent cost share. FEMA also released the slide deck from a webinar on the policy. Additional Public Assistance-specific guidance 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).

  • DOL Approves Additional Unemployment Insurance Grants to States: The Department of Labor (DOL) announced the award of $11.4 million in unemployment insurance (UI) equity grants to three states: Maryland, Nebraska, and South Dakota. Funded by ARPA, the grants will allow states to implement projects that seek to ensure race, age, ethnicity, language proficiency, disability status, geographic location or other systemic barriers do not prevent those in need from accessing UI benefits. This is the fifth set of unemployment insurance grants awarded to states.
  • ACF Updates Information Available in LIHWAP Data Dashboard: The Administration for Children and Families (ACF) provided an update on the Low Income Household Water Assistance Program (LIHWAP) Data Dashboard. The dashboard has been updated to include Tribal and territory data and to report data for the second quarter. The agency also released Tribal and territory grant recipient summary profiles featuring key program elements from the approved LIHWAP implementation plans.

 

Administration Actions Related to COVID-19

  • CDC Director Signs Off on COVID-19 Vaccines for Young Children: The Director of the Centers for Disease Control and Prevention (CDC) endorsed the Advisory Committee on Immunization Practices’ recommendation that all children 6 months through 5 years of age should receive a COVID-19 vaccine. This follows the Food and Drug Administration (FDA) authorizing emergency use of the Moderna and Pfizer-BioNTech COVID-19 vaccines. For Moderna, the FDA amended the emergency use authorization (EUA) for individuals 6 months through 17 years of age (previously authorized in adults 18 years of age and older). For Pfizer-BioNTech, the EUA is amended to include individuals 6 months through 4 years of age; the vaccine had been authorized for use in individuals 5 years of age and older.
  • FNS Releases Memos on Additional WIC Flexibilities Regarding Infant Formula: The Food and Nutrition Service (FNS) released a letter in response to correspondence from WIC state agencies requesting flexibility to the maximum monthly allowance requirements in the Special Supplemental Nutrition Program for Women, Infants, and Children (WIC) as a result of the ongoing pandemic and infant formula shortfall. FNS also released a letter providing WIC state agencies flexibility related to imported infant formula under the Infant Formula Enforcement Discretion Policy.
  • Education Posts Information on Improving Access to High-Quality Resources to Support Social-Emotional Development and Mental Health: The Department of Education released a set of recommendations for state, territorial, Tribal, and local policymakers to ensure that all young children and their caregivers have access to high-quality resources that equitably support social-emotional development and mental health. Each of the four recommendations include action steps for policymakers and provide examples.

 

IIJA Implementation Resources Released

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

  • The Environmental Protection Agency (EPA) announced $1 billion from the IIJA to help communities reduce PFAS in drinking water. The goal of the Emerging Contaminants in Small or Disadvantaged Communities grant program is to have states, territories, and Tribes prioritize grant funding in small or disadvantaged communities to focus exclusively on addressing emerging contaminants in drinking water, including PFAS. Grants will be awarded non‐competitively to states, territories, and Tribes. States that intend to pursue grant program funding must submit a Letter of Intent by August 15.
  • The Department of the Interior (DOI) announced the allocation of $103 million in fiscal year 2022 for wildfire risk reduction efforts from the IIJA and the establishment of an interagency wildland firefighter health and wellbeing program. The funding will invest across multiple agencies to support efforts to reduce wildfire risk, support post-fire rehabilitation, and fund wildland science.
  • The Federal Highway Administration (FHWA) released guidance on local hiring preference for construction jobs through a series of Questions and Answers. The guidance defines hiring preference and provides examples.
  • The Federal Transit Administration (FTA) published updated frequently asked questions on Public Transportation Agency Safety Plan requirements under the IIJA. The FAQs address topics including applicability, safety committees, training, and safety performance targets.
  • The administration launched the Talent Pipeline Challenge to fill high quality jobs focused on infrastructure. The challenge is a nationwide call to action for employers, education and training providers, states, local, Tribal, and territorial governments, and philanthropic organizations to make tangible commitments that support equitable workforce development in three critical infrastructure sectors: broadband, construction, and electrification (EV charging infrastructure and battery manufacturing). For state, local, Tribal and territorial governments, the challenge asks them to use federal funding to invest in workforce development efforts and develop regional workforce training plans.
  • The Environmental Protection Agency (EPA) announced it is currently accepting applications from school districts as part of a $500 million funding effort under the IIJA to replace the nation’s fleet of school buses with zero-emission buses. EPA will prioritize applications that replace buses serving high-need local education agencies, Tribal Schools, and rural areas. Applications are being accepted until August 19.
  • The administration is implementing a new set of temporary pay increases for federal wildland firefighters that will increase their bi-weekly pay, up to the lesser of $20,000 or 50 percent of their annual base salary, through September 2023.

 

Fiscal Year 2023 Budget Update

The House Appropriations Committee began marking up appropriations bills in subcommittee last week and will continue this week. Full committee markups will begin this week as the committee also released the fiscal year 2023 subcommittee allocations.

  • Fiscal Year 2023 Subcommittee Allocations: The committee released the 302(b) allocations for the 12 subcommittees that provide more than $1.6 trillion in funding.
  • Energy-Water Development: The bill includes $56.275 billion in funding, which represents an increase of $3.4 billion above the current year funding level. The bill increases funding for the Army Corps of Engineers, Bureau of Reclamation, and the Department of Energy, including increased funding for State and Community Energy Programs. The bill will be considered by the subcommittee this week.
  • Interior-Environment: The bill includes $44.8 billion in regular appropriations, an increase of $6.8 billion, or 18 percent, over the current year. There is also an additional $2.55 billion provided under the fire suppression cap adjustment. The bill will be considered by the subcommittee this week.
  • Financial Services and General Government: The subcommittee approved by voice vote the bill that includes $29.8 billion in funding, an increase of $4.3 billion, or 17 percent, over the current year. The bill increases funding for Election Security Grants at the Election Assistance Commission. A summary can be found here and a list of earmarks here.
  • Homeland Security: The subcommittee approved by voice vote the bill that includes total funding of $85.67 billion, including $60.3 billion within the funding allocation, $19.95 billion for major disaster response and recovery, and $5.4 billion that is offset by fee collections. The subcommittee allocation is $2.7 billion above the current year. A summary can be found here and a list of earmarks here.
  • Agriculture-Rural Development: The subcommittee approved by voice vote the bill that provides funding of $27.2 billion, an increase of $2.08 billion or 8 percent, above the current year. In total, the bill includes $195 billion for both discretionary programs and mandatory programs such as the Supplemental Nutrition Assistance Program. A summary can be found here and a list of earmarks here.
  • Military Construction-Veterans Affairs: The subcommittee approved by voice vote the bill that provides $314.1 billion, an increase of $29.5 billion or more than 10 percent, above the current year. Discretionary funding totals $150.5 billion, an increase of $23 billion. A summary can be found here and a list of earmarks here.
  • Legislative Branch: The subcommittee approved by voice vote the bill that provides $5.7 billion, an increase of $954.4 million or 20.1 percent, above the current year. A summary can be found here.
  • Defense: The subcommittee approved by voice vote the bill that provides total funding of $761.7 billion, an increase of $32.21 billion above the current year. A summary can be found here and a list of earmarks here.

 

HUD Announces $520 Million to Reduce Lead Exposure

Last week the Department of Housing and Urban Development (HUD) announced the availability of $520 million to state and local government agencies to protect children and families from lead-based paint and other home health hazards. The funding is available under the Lead Based Paint Hazard Reduction grant program, which identifies and cleans up dangerous lead hazards and additional health and safety hazards in low-income families’ privately-owned homes. Applications are due by August 8.

 

EPA Releases Drinking Water Health Advisories Related to PFAS

On Wednesday the Environmental Protection Agency (EPA) released four drinking water health advisories for per-and polyfluoroalkyl substances (PFAS). EPA is issuing interim, updated drinking water health advisories for perfluorooctanoic acid (PFOA) and perfluorooctane sulfonic acid (PFOS) that replace those EPA issued in 2016. The updated advisory levels, which are based on new science and consider lifetime exposure, indicate that some negative health effects may occur with concentrations of PFOA or PFOS in water that are near zero and below EPA’s ability to detect at this time. And for the first time, EPA is issuing final health advisories for perfluorobutane sulfonic acid and its potassium salt (PFBS) and for hexafluoropropylene oxide (HFPO) dimer acid and its ammonium salt (“GenX” chemicals); the health advisory levels are well above the level of detection, based on risk analyses in recent scientific studies.

 

FDA Extends Comment Period for Proposed Tobacco Standards

Today the Food and Drug Administration (FDA) published an extension of comment period in the Federal Register related to the establishment of tobacco standards for menthol in cigarettes and flavors in cigars. The two proposed rules originally appeared in the Federal Register on May 4 and the comment period is now extended from July 5 to August 2. The proposed rules as published include menthol in cigarettes and characterizing flavors in cigars.

 

Senate Passes Bill to Expand Veterans Benefits for Toxic Exposure

On Thursday the Senate voted 84-14 to approve H.R. 3967, the Sergeant First Class Heath Robinson Honoring Our Promise to Address Comprehensive Toxics (PACT) Act of 2022. The bill would expand health care and benefits from the Department of Veterans Affairs (VA) to toxic-exposed veterans from all eras. The legislation adds 23 burn pit and toxic exposure-related conditions to VA’s list of service presumptions, expands presumptions related to Agent Orange exposure, improves VA’s resources and training for toxic-exposed veterans, and creates a framework for the establishment of future presumptions of service connection related to toxic exposure. The bill would also establish 31 new VA health care facilities across 19 states. The House will next have to approve the revised bill before it goes to the President.

 

House Approves Bipartisan Wildlife Conservation Bill, Increases Funding to States and Territories

Last week the House voted 231-190 to approve H.R. 2773, Recovering America’s Wildlife Act of 2021. The bill provides funding for the conservation or restoration of wildlife and plant species of greatest conservation need, including endangered or threatened species. Provisions in the bill include: funding conservation efforts for more than 12,000 species of wildlife and plants in need of assistance by providing $1.3 billion in dedicated annual funding for proactive, on-the-ground efforts in every state and territory; ensuring wildlife recovery efforts will be guided by the Congressionally-mandated State Wildlife Action Plans, which identify specific strategies to restore the populations of species of greatest conservation need; and providing Tribal nations $97.5 million annually to fund proactive wildlife conservation efforts on roughly 140 million acres of land. A companion bill was approved by the Senate Environment and Public Works Committee in April but has not been considered by the full Senate. The administration indicated strong support of the legislation’s goals in a Statement of Administration Policy.

 

IRS Raises Tax-Deductible Mileage Rate

The Internal Revenue Service (IRS) recently announced an increase in the optional standard mileage rate for the final six months of 2022. Taxpayers may use the optional standard mileage rates to calculate the deductible costs of operating an automobile for business and certain other purposes. For the final 6 months of 2022, the standard mileage rate for business travel will be 62.5 cents per mile, up 4 cents from the rate effective at the start of the year. In recognition of recent gasoline price increases, the IRS made this special adjustment for the final months of 2022; the agency normally updates the mileage rates once a year in the fall for the next calendar year.

 

For Your Information

HHS Awards $115 Million to Support Ending the HIV Epidemic

The Department of Health and Human Services (HHS) awarded nearly $115 million to 60 recipients to implement the Ending the HIV Epidemic in the U.S. initiative, part of the administration’s efforts to reduce the number of new HIV infections in the U.S. by at least 90 percent by 2030. Funding of $102.8 million was awarded to 39 metropolitan areas and 8 states (MS, KY, MO, SC, AL, AR, OK, and OH).

 

HRSA Announces $10 Million for Rural Communities to Expand Opioid Treatment

The Health Resources and Services Administration (HRSA) announced the availability of $10 million in substance misuse grant funding through the Rural Communities Opioid Response Program. The funding will help rural communities establish new treatment access points to connect individuals to medication to treat opioid use. Applications are due by July 29.

 

FTA Announces $8.4 Million to Help Connect People to Health Care, Critical Services

The Federal Transit Administration (FTA) announced awards of approximately $8.4 million to 17 projects in 16 states to improve public transportation for underserved groups. The pilot program increases access to critical services by building partnerships among health, transportation, and other service providers.

 

DOL Issues Guidance on Trade Adjustment Assistance, Dislocated Worker Grant Programs

The Department of Labor (DOL) issued three Training and Employment Guidance Letters related to trade adjustment assistance and dislocated worker grants. First, Letter No. 14-21 provides fiscal year 2022 Trade Adjustment Assistance training and other activities grant management guidance. Second, Letter No. 15-21 provides the initial allocation of fiscal year 2022 Trade Adjustment Assistance funds and process for requesting reserve funds. Finally, Letter No. 16-21 provides updated National Dislocated Worker Grant Program guidance.

 

USDA Announces Assistance for Specialty Crop Farm Safety Expenses

The U.S. Department of Agriculture (USDA) announced it plans to provide up to $200 million in assistance for specialty crop producers who incur eligible on-farm food safety program expenses to obtain or renew a food safety certification in calendar years 2022 or 2023. Specialty crop operations may receive assistance for costs including developing a food safety plan, maintaining a food safety plan, food safety certification, certification upload fees, microbiological testing, and training. The application period is June 27, 2022 through January 31, 2023.

 

Recently Released Reports

Cost-of-Living Adjustments

National Association of State Retirement Administrators

Justice Assistance Grant Program, 2021

Bureau of Justice Statistics

Work Requirements and Work Supports for Recipients of Means-Tested Benefits

Congressional Budget Office

 

Economic News

Unemployment Claims Reported for Week Ending June 11

The U.S. Department of Labor released unemployment insurance weekly claims data last Thursday that showed for the week ending June 11, the advance figure for seasonally adjusted initial claims was 229,000. This is a decrease of 3,000 from the previous week’s revised level, which was revised up by 3,000 from 229,000 to 232,000. The 4-week moving average was 218,500, an increase of 2,750 from the previous week's revised average of 215,750. The advance seasonally adjusted insured unemployment rate was 0.9 percent for the week ending June 4, unchanged from the previous week’s unrevised rate. The advance number of actual initial claims under state programs, unadjusted, totaled 204,461 in the week ending June 11, an increase of 17,695 (or 9.5 percent) from the previous week.

 

Federal Reserve Raises Interest Rates

At its June meeting, the Federal Open Market Committee voted 10-1 to raise the target range for the federal funds rate to 1.50 to 1.75 percent and anticipates that ongoing increases in the target range will be appropriate. The committee noted that overall economic activity appears to have picked up after edging down in the first quarter, and job gains have been robust while the unemployment rate has remained low. However, inflation remains elevated, and the invasion of Ukraine and related events are creating additional upward pressure on inflation. The committee also noted it will continue reducing its holdings of Treasury securities and agency debt and agency mortgage-backed securities, with the committee “strongly committed to returning inflation to its 2 percent objective.”

 

Unemployment Rates Lower in 16 States in May

New data from the Bureau of Labor Statistics shows unemployment rates were lower in May in 16 states and stable in 34 states and the District of Columbia. Compared to one year earlier, all 50 states and the District of Columbia had jobless rate decreases. The national jobless rate remained at 3.6 percent but was 2.2 percentage points lower than in May 2021. Looking across states, 18 states had unemployment rates lower than the U.S. figure of 3.6 percent, 9 states and the District had higher rates, and 23 states had rates that were not appreciably different. Nonfarm payroll employment increased in 7 states, decreased in 3 states, and was essentially unchanged in 40 states and the District of Columbia. Over the year, nonfarm payroll employment increased in 48 states and the District and was essentially unchanged in 2 states.