Budget Blog

July 26, 2022 - Washington Report

By Leah Wavrunek posted 07-26-2022 04:16 PM

  

This Week on the Hill  

The House and Senate are in session this week.

The House convenes today and will consider 27 bills including H.R. 5128, the Expanding Access to Capital for Rural Job Creators Act. For Wednesday and the balance of the week, the House will consider seven bills including H.R. 5118, the Wildfire Response and Drought Resiliency Act. On Wednesday the Education and Labor Committee will mark up H.R. 8450, the Healthy Meals, Healthy Kids Act, to reauthorize federal child nutrition programs. More information on the bill can be found here.

The Senate is in session and earlier today the Senate voted 64-32 to invoke cloture and limit debate on the semiconductor bill introduced last week by Senate Majority Leader Chuck Schumer (D-NY). The bill includes $52 billion in five-year grants for semiconductor manufacturing and research, a 25 percent tax credit for investments in semiconductor manufacturing facilities through 2026, and increased funding for the National Science Foundation. A vote on final passage of the bill is expected on Wednesday and the House could send the bill to the President by the weekend.

Several data releases and economic announcements are expected this week. Consumer confidence data was released today, the Federal Reserve may announce interest rate changes on Wednesday, gross domestic product for the second quarter will be released on Thursday and the latest personal consumption expenditures price index data will be released on Friday.

 

U.S. Department of Education Webinar Recording on Compliance Supplement for ESSER, GEER and EANS
On July 14, the U.S. Department of Education Office of State and Grantee Relations held a webinar on the 2022 Compliance Supplement for the Elementary and Secondary School Emergency Relief (ESSER) Fund, the Governor’s Emergency Education Relief (GEER) Fund, and the Emergency Assistance to Nonpublic Schools (EANS) program. A link to the recording and a full transcript of the webinar are now posted here. The webinar covered the Single Audit compliance areas selected for these programs, including discussion around maintenance of effort requirements.

 

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 Adds New FAQ for SSBCI: The Treasury Department updated its frequently asked questions for the State Small Business Credit Initiative (SSBCI). The new question asks how Treasury will disburse Technical Assistance Grant Program funds.
  • DOL Awards UI Equity Grants to Two States: The Department of Labor (DOL) announced the award of $9.1 million in equity grants to Rhode Island and Wisconsin’s state employment insurance systems to enhance awareness and improve delivery of unemployment insurance (UI). In addition to this award, the department has announced the awards of more than $76.5 million in ARPA funding to 15 states and the District of Columbia.
  • Treasury Publishes HAF Program and Service Design Tips: The Treasury Department published a Program and Service Design resource with tips on improving the design of Homeowner Assistance Fund (HAF) programs. The resource covers topics including accessibility, equity, and usability.
  • Administration Releases Fact Sheet on Investing in Summer Learning: The administration released a fact sheet on investing in summer learning and enrichment programs to help students catch up. The fact sheet highlights the $122 billion distributed through ARPA while also sharing examples from two states and a local government.
  • 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 22, shows the Total NEU Allocation, Second NEU Tranche amount and invoice date, and if a first extension has been granted.
  • DOL Updates CARES ACT Unemployment Programs Guidance: The Department of Labor (DOL) released Unemployment Insurance (UI) Program Letter No. 28-20, Change 4. The letter is intended to provide states with information on existing sources of administrative funding to resolve outstanding items from the expired CARES Act unemployment compensation (UC) programs and to announce up to $225 million for administrative costs related to reporting and overpayment detection and recovery activities. A list of funding by state and territory can be found in the letter.
  • Treasury Releases May Emergency Rental Assistance Report: The Treasury Department released the May report for the Emergency Rental Assistance (ERA) program. The report shows spending through May 31 for both ERA1 and ERA2, with cumulative spending across both programs totaling $30.7 billion.

 

IIJA Implementation Resources Released

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

  • The Department of the Interior (DOI) released the final guidance for eligible states and the Navajo Nation on how to apply for the first $725 million in funding available for reclaiming abandoned mine lands (AMLs). The final guidance was informed by stakeholder comments and will provide state and Tribal AML programs with overarching information concerning interpretation, project eligibility, and priorities for use of fiscal year 2022 funds.
  • The Federal Transit Administration (FTA) announced $1.75 billion to improve accessibility for all riders at the nation’s oldest rail public transportation systems, including $343 million in a notice of funding availability now. The funding will help agencies retrofit subway stations so people who need an elevator or ramp – including people who use wheelchairs or have limited mobility – can still reliably access the rail systems serving their communities. The All Stations Accessibility Program is a new discretionary grant program created by the IIJA; applications are due by September 30.
  • The Environmental Protection Agency (EPA) announced an investment of $132 million from the IIJA over the next five years for work to protect and restore estuaries of national significance. The funding will support projects to address climate resilience, prioritize equity, and manage other key water quality and habitat challenges across 28 estuaries along the Atlantic, Gulf and Pacific coasts and in Puerto Rico.
  • The Department of Energy (DOE) announced a Notice of Intent to provide $225 million for states and local governments to expand the implementation of the latest building energy codes and support the development of buildings that use less energy. Funding is provided by the IIJA through the Building Energy Codes: Resilient and Efficient Codes Implementation Program. DOE expects to release the Funding Opportunity Announcement this fall.
  • The Vice President highlighted the administration’s efforts to enroll households in the Affordable Connectivity Program (ACP), with 1 million new households signing up to save on home broadband. The administration is also calling on governors to join the enrollment drive, with the fact sheet giving outreach examples at the state and local level while also noting actions taken by federal agencies.
  • The U.S. Department of Agriculture (USDA) announced a strategy for addressing a reforestation backlog of four million acres on national forests and planting more than one billion trees over the next decade. Combining resources from the IIJA with support from state, local, and Tribal governments and other partners, the agency aims to eliminate the backlog over the next 10 years and develop the infrastructure to keep up with increasing needs.

 

Fiscal Year 2023 Federal Budget Update

Last week the House voted 220-207 on a party-line vote to approve legislation (H.R. 8294) that contains the first six appropriations bills for fiscal year 2023. The approximately $405 billion package includes Transportation-Housing and Urban Development, Agriculture, Energy-Water, Financial Services-General Government, Interior-Environment, and Military Construction-Veterans Affairs. Senate Democrats are expected to release their spending bills as early as this week.

 

White House Announces Actions to Address Extreme Heat

On Wednesday the President announced executive actions on climate to address extreme heat and boost offshore wind. The Federal Emergency Management Agency (FEMA) announced $2.3 billion in funding for the Building Resilient Infrastructure and Communities (BRIC) program for fiscal year 2022 – the largest BRIC funding investment in history, boosted by the Infrastructure Investment and Jobs Act (IIJA). The Department of Health and Human Services (HHS) issued guidance that expands how the Low Income Home Energy Assistance Program (LIHEAP) can promote the delivery of efficient air conditioning equipment, community cooling centers, and more. The Department of the Interior (DOI) proposed the first Wind Energy Areas in the Gulf of Mexico, a first step toward expanding offshore wind opportunities to another region of the country; the areas cover 700,000 acres and have the potential to power over three million homes. The Department of Labor’s Occupational Safety and Health Administration (OSHA) is conducting heat-related inspections, which are focused on over 70 high-risk industries across 43 states. Today the White House released a fact sheet on 10 ways the administration is responding to extreme heat, including launching Heat.gov, a new centralized portal with real-time, interactive data and resources on extreme heat conditions, preparedness and response.

 

USDA Announces Actions on School Meals, Farm to School Grants

On Friday the U.S. Department of Agriculture (USDA) announced an increase in school meals funding for this coming school year. Effective July 1, 2022, the reimbursement schools receive for each meal served will increase by approximately $0.68 per free/reduced-price lunch and $0.32 per free/reduced price breakfast. Other reimbursement rates are available online. This increase includes both a required annual adjustment in reimbursement rates to reflect the cost of food and an extra temporary per-meal boost in reimbursements from the recent Keep Kids Fed Act. A breakdown by state and territory can be found here. The department also announced the award of more than $10 million in Farm to School Grants to 123 projects; a list of funds by state can be found here. This is in addition to the $60 million non-competitive grants for states announced last month that will allow them to better assist program operators in purchasing and using more local foods in meals for kids; additional information on these grants is coming soon.

 

Administration Releases Monkeypox Research Priorities as WHO Declares Global Health Emergency

On Thursday the White House Office of Science and Technology (OSTP) released a set of research priorities to address the monkeypox outbreak, noting over 2,300 infections in the United States and 15,000 around the world. The research priorities will enable the OSTP to gain a better understanding of the virus and what will work best to stop the outbreak. The federal government identified $140 million to support the high-priority projects and the Department of Health and Human Services released a fact sheet on its response to the outbreak. On Saturday, the World Health Organization declared monkeypox a global health emergency and last week a group of 50 House Democrats called on the administration to declare a public health emergency, along with other actions.

 

HHS Reorganizes, Breaks Out Pandemic Response

Last week the Department of Health and Human Services (HHS) announced that Secretary Becerra elevated the existing Office of the Assistant Secretary for Preparedness and Response (ASPR) from a staff division to an operating division, taking on the new name of the Administration for Strategic Preparedness and Response (ASPR). The move elevates ASPR to a standalone agency within the department, similar to the Centers for Disease Control and Prevention (CDC) and Centers for Medicare and Medicaid Services (CMS). The change in name and organizational status are effective immediately while the transition will phase in over the next one to two years. According to the announcement, “the reclassification of ASPR as an operating division is recognition of the growing size and scope of ASPR’s mission over the years, especially in light of the multi-year COVID-19 response.”

 

Education Releases Guidance on Supporting Students with Disabilities

Last week the Department of Education released new guidance to help public elementary and secondary schools fulfill their responsibilities to meet the needs of students with disabilities and avoid the discriminatory use of student discipline. The guidance explains that when schools do discipline students with disabilities, they must do so in a nondiscriminatory manner. The department also released accompanying resources including a fact sheet, questions and answers, a guide for stakeholders, and a letter from the Secretary of Education.

 

Labor and Commerce Launch Cybersecurity Apprenticeship Sprint

Last week the Departments of Labor and Commerce announced the 120-Day Cybersecurity Apprenticeship Sprint, an effort to support numerous industries’ use of Registered Apprenticeships to develop and train a skilled and diverse cybersecurity workforce. The sprint will continue until National Apprenticeship Week, November 14-20. There are currently 714 registered apprenticeship programs and 42,260 apprentices in cybersecurity-related occupations; the sprint will build upon this program and focus on creating new pathways for workers in cybersecurity or a related field through partnerships with K-12, higher education, workforce partners, and training programs.

 

President Announces Safer America Plan

Last week the President announced the Safer America Plan, outlining how he would invest $35 billion in funds from his fiscal year 2023 budget request to make communities safer. The plan includes $13 billion over five years to communities to help them hire and train 100,000 additional police officers for accountable community policing, with dedicated funds for small law enforcement agencies, in addition to nearly $3 billion to clear court backlogs and solve cases. The plan also establishes a new $15 billion grant program called Accelerating Justice System Reform that cities and states can use over 10 years to advance strategies to prevent violent crime and/or identify non-violent situations that may merit a public health response or other response; it also invests an additional $5 billion in evidence-based community violence intervention programs.

 

Education Proposes Regulations to Protect Veterans, Increase College Oversight and Expand Second Chance Pell

Today the Department of Education released proposed regulations that implement changes in the American Rescue Plan Act (ARPA) that better protect veterans and service members, clarify procedures for institutions undergoing changes in ownership, and extend Pell Grants to incarcerated individuals. The regulations would strengthen the “90/10” rule for for-profit colleges by requiring that at least 10 percent of revenues come from sources other than any federal education assistance, not just aid awarded by the department. Congress recently established eligibility for Pell Grants for incarcerated individuals enrolled in qualifying programs and the proposed regulations would clarify and codify requirements for providers of prison education programs. The department also released an unofficial version of the regulations and a fact sheet.

 

HHS Announces Over $49 Million to Increase Health Care Coverage for Children and Families

Last week the Department of Health and Human Services (HHS) awarded $49 million to organizations to connect more children, parents, and families to health care coverage. Grantees will provide enrollment and renewal assistance to children and their families, and – for the first time ever – to expectant mothers to promote improved maternal and infant health outcomes. The department issued 36 cooperative agreements in 20 states through Medicaid’s Connecting Kids to Coverage program. A list of grantees can be found here.

 

DOL Releases Guidance Letters for Unemployment Insurance, Community Project Recipients

The Department of Labor (DOL) recently released two guidance letters to assist state workforce agencies and community project funding recipients. Training and Employment Guidance Letter No. 03-22 provides guidance for DOL’s fiscal year 2022 Community Project Funding/Congressionally Directed Spending recipients, as outlined in the Consolidated Appropriations Act, 2022. To receive funding, eligible applicants must submit applications. Unemployment Insurance Program Letter No. 17-22 initiates the State Quality Service Plan process and also summarizes national priorities for fiscal year 2023.

 

MARAD Awards $19.6 Million to Small Shipyards

On Thursday the Department of Transportation’s Maritime Administration (MARAD) announced $19.6 million in grant awards to 24 small shipyards in 19 states through the Small Shipyard Grant Program. The funds will help awardees modernize, increase productivity, and expand local employment opportunities while competing in the global marketplace. A list of recipients by state is included in the announcement.

 

Recently Released Reports

State Hybrid Retirement Plans

National Association of State Retirement Administrators

Five Things to Know About the Possible Renewal of Extra Affordable Care Act Subsidies

Kaiser Family Foundation

State and Local Sales Tax Rates, Midyear 2022

Tax Foundation

 

Economic News

Unemployment Claims Reported for Week Ending July 16

The U.S. Department of Labor released unemployment insurance weekly claims data last Thursday that showed for the week ending July 16, the advance figure for seasonally adjusted initial claims was 251,000. This is an increase of 7,000 from the previous week’s unrevised level of 244,000. The 4-week moving average was 240,500, an increase of 4,500 from the previous week’s revised average of 236,000. The advance seasonally adjusted insured unemployment rate was 1.0 percent for the week ending July 9, an increase of 0.1 percentage point from the previous week’s unrevised rate. The advance number of actual initial claims under state programs, unadjusted, totaled 248,991 in the week ending July 16, an increase of 7,853 (or 3.3 percent) from the previous week.

 

Unemployment Rates Stable in 38 States in June

New data from the Bureau of Labor Statistics shows that many state unemployment rates saw little change in June; unemployment rates were lower in 10 states and the District of Columbia, higher in 2 states and stable in 38 states. Compared to one year earlier, all 50 states and the District of Columbia had jobless rate decreases. The national unemployment rate remained at 3.6 percent but was 2.3 percentage points lower than in June 2021. In total, 20 states had unemployment rates lower than the U.S. figure, 10 states and the District of Columbia had higher rates, and 20 states had rates that were not appreciably different. Nonfarm payroll employment increased in 13 states, decreased in 2 states, and was essentially unchanged in 35 states and the District of Columbia. Over the year, nonfarm payroll employment increased in 47 states and the District and was essentially unchanged in 3 states.

 

State Job Openings Rates Little Changed in 36 States for May

The Bureau of Labor Statistics recently released data on state job openings and labor turnover for May. The number of job openings decreased in 12 states and the District of Columbia and increased in 3 states while job openings rates decreased in 11 states and the District, increased in 3 states, and were little changed in 36 states. The number of hires increased in 2 states and decreased in 2 states while the number of total separations decreased in 6 states and increased in 4 states. The number of quits decreased in 7 states and increased in 2 states in May, and layoffs and discharges increased in 5 states and decreased in 4 states.