Budget Blog

July 19, 2022 - Washington Report

By Leah Wavrunek posted 07-19-2022 03:51 PM


This Week on the Hill  

The House and Senate are in session this week.

The House convened Monday and considered 10 bills. For Tuesday and the balance of the week, the House will consider two bills including H.R. 8294, which combines six appropriations bills for fiscal year 2023 into a “minibus” covering Transportation-Housing and Urban Development; Agriculture; Energy-Water; Financial Services-General Government; Interior-Environment; and Military Construction-Veterans Affairs. Committees scheduling hearings this week include the Homeland Security Committee hearing on supporting underserved communities in emergency management and the Transportation and Infrastructure Committee hearing on implementing the Infrastructure Investment and Jobs Act (IIJA).

The Senate convened Monday and continues consideration of judicial nominations. The Senate may introduce a bill to provide support to the domestic semiconductor industry; a draft version includes $54.2 billion over five years in emergency spending and creates a new 25 percent tax credit for investment in U.S. chipmaking capacity that would lapse after 2026. Committees scheduling hearings this week include the Banking, Housing and Urban Affairs Committee hearing on homelessness and the Finance Committee hearing on role of tax incentives in affordable housing.


HHS Renews COVID-19 Public Health Emergency

On Friday Department of Health and Human Services (HHS) Secretary Xavier Becerra renewed, effective July 15, 2022, the public health emergency (PHE) declaration originally declared January 31, 2020 related to the COVID-19 pandemic. The renewal remains in effect for 90 days unless the Secretary determines the PHE no longer exists, and the Secretary may extend the declaration for subsequent 90-day periods for as long as the emergency continues. The available temporary 6.2 percentage point increase in the federal medical assistance percentage (FMAP) included in the Families First Coronavirus Response Act expires at the end of the quarter in which the public health emergency ends, which means the increased FMAP would likely be in effect until at least December 31, 2022. When a decision is made to terminate the declaration or let it expire, HHS plans to provide states with 60 days’ notice prior to termination.

Treasury Publishes Updates to HAF Reporting Resources

On Friday the Treasury Department published updates to multiple reporting resources for the Homeowner Assistance Fund (HAF) program. These updates include the HAF Reporting FAQs, HAF Quarterly Report User Guide, and HAF Guidance on Participant Compliance and Reporting Responsibilities. Each document includes a revision log that outlines the changes made on July 15. Per the HAF’s main program page, “The deadline for the HAF Annual Performance Report, as well as the first Quarterly Report for Tribal Governments with allocations under $5 million and the Department of Hawaiian Home Lands, has been postponed from August 15, 2022 to November 15, 2022. Quarterly Reports for States, Territories, and Tribal Governments with allocations over $5 million are due on August 15, 2022. Entities required to provide reporting by August 15 will receive an email from Treasury shortly with additional information on quarterly reporting.”


Treasury Announces Four Additional Capital Projects Fund State Plans Approved

Last week the Treasury Department announced the approval of an additional group of four states under the American Rescue Plan Act (ARPA) Capital Projects Fund (CPF): Kansas, Maine, Maryland, and Minnesota. The program provides $10 billion to states, territories, freely associated states, and Tribal governments to fund critical capital projects that enable work, education, and health monitoring in response to the public health emergency. In June, the department announced the first four recipients of CPF awards (Louisiana, New Hampshire, Virginia, and West Virginia) and it will continue approving state and Tribal plans on a rolling basis. States must submit their plans to Treasury by September 24, 2022.


Treasury Announces Nine Additional SSBCI State Plans Approved

On Monday the Treasury Department announced an additional group of nine state plans approved under the State Small Business Credit Initiative (SSBCI): Arizona, Connecticut, Indiana, Maine, New Hampshire, Pennsylvania, South Carolina, South Dakota, and Vermont. The SSBCI, reauthorized and expanded by the American Rescue Plan Act (ARPA), provides nearly $10 billion to states, the District of Columbia, territories, and Tribal governments to increase access to capital and promote entrepreneurship, especially in traditionally underserved communities as they emerge from the pandemic. State governments submitted plans for how they will use their SSBCI allocation to provide funding to small businesses, including through venture capital programs, loan participation programs, loan guarantee programs, collateral support programs, and capital access programs.


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).

  • Treasury Releases SLFRF Reporting Webinar on Making Edits and Revisions: The Treasury Department posted a reporting webinar to assist with reporting responsibilities for the State and Local Fiscal Recovery Funds (SLFRF) program. The webinar is for the Quarter 2 Project and Expenditure Report and looks at updates to revisions and bulk editing functions, providing examples of what to do when edits and revisions are needed to previous submissions. All other reporting webinars can be found here.
  • Treasury Updates NEU Distribution Information for Second Tranche: The Treasury Department updated its table on status of payments to states for distribution to non-entitlement units of local governments (NEUs). The table, last updated July 15, shows the Total NEU Allocation, Second NEU Tranche amount and invoice date, and if a first extension has been granted.
  • Education Awards Final $198 Million in Higher Education Funds: The Department of Education awarded the final $198 million in Higher Education Emergency Relief Fund (HEERF) grants. The grants will assist students who attend 244 colleges and universities and provides resources to help the institutions recover from the impacts of the pandemic. The grants were awarded to the institutions that have the greatest unmet needs; a HEERF breakdown by state can be found here.
  • FCC Announces Over $266 Million in Emergency Connectivity Funding: The Federal Communications Commission (FCC) announced it is committing over $266 million in two new funding rounds through the Emergency Connectivity Program. The funding supports applications from all three of the program’s application windows, supporting over 1 million students across the country.
  • Labor Sends Notice on Pandemic Unemployment Assistance Improper Payment Estimate Reviews: The Department of Labor released Unemployment Insurance Program Letter No. 16-22, to inform states that the 2022 Benefit Accuracy Measurement (BAM) Paid Claims Peer Reviews are cancelled and will be replaced by the Pandemic Unemployment Assistance (PUA) Improper Payment Estimate Reviews. Federal and state staff will review a sample of PUA cases provided by 26 states to establish an estimated national improper payment rate for the PUA program.
  • White House Releases Fact Sheet on ARPA Funds Used for Workforce Investments: The White House released a fact sheet that highlights the over $40 billion in ARPA funds that have been committed to workforce investments. The fact sheet notes that over $3 billion in additional, competitively awarded funding will be awarded in the coming months for the public health workforce and the Good Jobs Challenge. State and local examples are also included in the fact sheet.
  • Education Announces Engage Every Student Initiative: The Department of Education announced the Engage Every Student Initiative, which will help communities utilize ARPA funds, along with other state and local funds, to ensure every student who wants a spot in a high-quality out-of-school time program has one. The department also announced new resources to support out-of-school time including a contract to provide best practices in program implementation and a new tool to support states, districts or programs in building and using evidence to implement afterschool and summer learning programs.


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) announced that all states and territories have confirmed their participation in the Internet for All initiative. The announcement outlines the various programs and programmatic deadlines, including for the Broadband Equity, Access and Deployment (BEAD) Program and State Digital Equity Planning Grant Program.
  • The Joint Office of Energy and Transportation issued a reminder that state plans under the National Electric Vehicle Infrastructure (NEVI) Formula Program are due no later than August 1, 2022; the Federal Highway Administration will approve eligible plans by September 30, 2022.
  • The Environmental Protection Agency (EPA) updated their frequent questions about the IIJA State Revolving Funds. The questions address topics including allotments, eligibilities, grants management, and state match.
  • The Department of Energy’s Office of Electricity developed state-specific reports detailing potential decision-making scenarios and analyses based on individual state data. These reports are available to state agencies via the EV States Clearinghouse (free account required) and the information in the reports can inform the development and implementation of an EV Infrastructure Deployment Plan.
  • The Federal Transit Administration (FTA) issued a correction notice to an April 28, 2022 notice that apportioned funds appropriated by law. The notice provides a needed correction to that notice regarding pre-award authority and other grant and policy changes.
  • The Federal Highway Administration (FHWA) released new guidance to implement the section of the IIJA related to using existing flexibilities with respect to Systems Engineering Analyses and the development of best practices for implementing systems engineering to support intelligent transportation system (ITS) projects.


House Approves Veterans Toxic Exposure Bill

Last week the House voted 342-88 to approve a bill (S. 3373) that expands medical care eligibility to veterans who were exposed to toxic burn pits on U.S. military bases around the world. The legislation, revised after passage by the Senate due to a technical adjustment, is expected to provide easier access to health care and disability benefits to more than 3.5 million veterans by establishing a presumption of service connection for over 23 respiratory illnesses and cancers. The bill also eliminates the requirement that veterans prove exposure to toxic substances. The Senate is expected to take up the revised bill soon.


House Approves National Defense Authorization Bill

On Thursday the House voted 329-101 to approve H.R. 7900, the National Defense Authorization Act for Fiscal Year 2023 (NDAA). The bill authorizes approximately $840 billion in defense spending for fiscal year 2023, an increase of $37 billion to the President’s budget recommendation. Military personnel would receive a 4.6 percent across-the-board pay raise and the bill adds a supplementary 2.4 percent “inflation bonus” for lower-income military personnel and civilians. Additional information on the bill can be found here. Yesterday the Senate Armed Services Committee filed their version of the bill, S. 4543, which authorizes a topline spending amount of $847 billion. Each chamber passes their version and then a conference committee will meet to reconcile differences.


USDA Outlines Actions to Improve Infant Formula Access in WIC Program

The U.S. Department of Agriculture (USDA) recently released a fact sheet on actions to strengthen infant formula access resiliency in the Special Supplemental Nutrition Program for Women, Infants, and Children (WIC). Per the release, currently 1.2 million infants receive WIC formula benefits, and more than half of infant formula is purchased by WIC participants. The fact sheet outlines a series of actions USDA will take in coordination with state agencies including requirements for future rebate contracts, preparing for future supply chain disruptions, testing and launching an online shopping option for WIC participants, and increasing transparency and competition in WIC infant formula bids.


ACF Encourages Investing Funds in the Early Childhood Education Workforce

On Wednesday the Administration for Children and Families (ACF) released a Dear Colleague letter to grant recipients and lead agencies administering Child Care and Development Fund (CCDF), Head Start, Tribal Home Visiting Programs, and Preschool Development Grant Birth to Five (PDG B-5) programs. The letter strongly encourages states, Tribes, and local leaders to continue to utilize federal resources available to increase staff compensation, strengthen Early Childhood Education (ECE) professional development and career pathways, and invest in other strategies to recruit and retain a strong ECE workforce. The letter also outlines resources available, including guidance, a workforce strategy webpage, and recent examples of innovative workforce strategies.


DOL Announces $121 Million in Grants for Registered Apprenticeship Programs

The Department of Labor (DOL) recently announced the award of more than $121 million in Apprenticeship Building America grants to strengthen and modernize Registered Apprenticeship programs. The grant program increases the number of programs and apprentices, diversifies the industries using Registered Apprenticeship and improves the access to and performance of Registered Apprenticeship Programs for underrepresented and underserved communities. Funding was awarded in four categories including State Apprenticeship System Building and Modernization; a list of recipients is included in the press release.


FNS Releases SNAP Employment and Training Guidance

Last Wednesday the Food and Nutrition Service (FNS) issued Supplemental Nutrition Assistance Program (SNAP) Employment and Training (E&T) screening and referral guidance for state agencies. The guidance is intended to answer state questions on screening and referral to E&T programs, improve compliance with the regulations, and provide a more accountable E&T program to participants served.


USDA Expands Crop Insurance Offerings for Farmers

Last week the U.S. Department of Agriculture (USDA) announced additional steps to support U.S. farmers, including reducing the economic risk of raising two crops on the same land in one year. Double cropping makes it easier to grow food, increase food supply and lower food costs. To reduce the risk, USDA is expanding double crop insurance opportunities in over 1,500 counties where double cropping is viable. Maps of expanded opportunities for soybeans and sorghum can be found here and frequently asked questions here.


Recently Released Reports

States Pursue Tax Relief in 2022

National Conference on State Legislatures

Department of Justice Grant Funding in the Bipartisan Safer Communities Act

Congressional Research Service

Streamlining Emergency Management: Issues, Impacts, and Options for Improvement

Homeland Security Operational Analysis Center


Economic News

Unemployment Claims Reported for Week Ending July 9

The U.S. Department of Labor released unemployment insurance weekly claims data last Thursday that showed for the week ending July 9, the advance figure for seasonally adjusted initial claims was 244,000. This is an increase of 9,000 from the previous week’s unrevised level of 235,000. The 4-week moving average was 235,750, an increase of 3,250 from the previous week's unrevised average of 232,500. The advance seasonally adjusted insured unemployment rate was 0.9 percent for the week ending July 2, a decrease of 0.1 percentage point from the previous week’s unrevised rate. The advance number of actual initial claims under state programs, unadjusted, totaled 241,314 in the week ending July 9, an increase of 21,384 (or 9.7 percent) from the previous week.


Consumer Price Index Increased in June 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 June, showing the CPI-U increased 1.3 percent on a seasonally adjusted basis. Over the last twelve months, the all items index increased 9.1 percent before seasonal adjustment. The index for all items less food and energy rose 0.7 percent in June, while the energy index rose 7.5 percent, with the gasoline index rising 11.2 percent, and the food index rising 1.0 percent. For the 12 months ending in June the index for all items less food and energy rose 5.9 percent. Meanwhile, real average hourly earnings for all employees decreased 1.0 percent from May to June, seasonally adjusted. This result stems from an increase of 0.3 percent in average hourly earnings combined with an increase of 1.3 percent in the CPI-U.