Budget Blog

January 11, 2022 - Washington Report

By Leah Wavrunek posted 01-11-2022 03:52 PM


This Week on the Hill  

The House and Senate are in session this week. The House convened yesterday to establish a quorum for the Second Session of the 117th Congress. For today and the balance of the week, the House will consider two bills including H.R. 1836, the Guard and Reserve GI Parity Act of 2021. The bill would expand GI Bill education benefits to eligible members of the National Guard and reserves. The Senate convened yesterday and continues work on administration nominations.


Treasury Releases Final Rule for SLFRF Program

On Friday the Treasury Department released the final rule for the Coronavirus State and Local Fiscal Recovery Funds (SLFRF). The final rule will take effect on April 1, 2022 and according to the press release from Treasury, “provides state and local governments with increased flexibility to pursue a wider range of uses…” Resources released include the text of the final rule, an overview of the major provisions, a compliance statement and a tool for determining low and moderate income households. An update to the Frequently Asked Questions document indicates that “Treasury anticipates issuing FAQs for the Final Rule at a later date.”


Treasury Releases Project and Expenditure Report User Guide for SLFRF Program

On Friday the Treasury Department released the Project and Expenditure Report User Guide for the Coronavirus State and Local Fiscal Recovery Funds (SLFRF). The document provides information on using Treasury’s portal to submit the required reports and is a supplement to the Compliance and Reporting Guidance. Treasury also released a list for recipients to identify their reporting tiers. The first project and expenditure report for states and territories is due by January 31.


Treasury Updates ERA Expenditure, Reallocation Information

On Friday the Treasury Department released November data for the Emergency Rental Assistance (ERA) program, noting that state and local governments provided assistance to approximately 665,000 renters and landlords, bringing the total number of payments to more than 3.1 million. The $2.9 billion in expenditures from both ERA1 and ERA2 funds in November was the largest amount paid to households since the program was created. Treasury projects that approximately $25-30 billion of combined ERA1 and ERA2 funds were spent or obligated by the end of 2021. The department also announced it will disburse over $1.1 billion in ERA1 funding through reallocation; more than three-quarters are one-time transfers proposed voluntarily between ERA1 grantees in the same state. According to the press release, Treasury has begun informing grantees about the process for requesting funding in the second round of ERA1 reallocations; the deadline for submitting a request is January 21, 2022. Additional information on requesting reallocation funds can be found here. Treasury also updated its guidelines for program websites to include resources for grantees to improve access for those with limited English proficiency.


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).

  • FCC Commits $361 Million in Additional Emergency Connectivity Funds: The Federal Communications Commission (FCC) announced it is committing $361.03 million in its latest wave of Emergency Connectivity Fund program support. This round of commitments will support 802 schools, 49 libraries and 8 consortia and brings total commitments to nearly $4.2 billion. A list of commitments by state and territory can be found here.
  • Administration Announces State, Territory LIHEAP Allocations: The administration announced state and territory funding amounts for the Low Income Home Energy Assistance Program (LIHEAP). ARPA more than doubled LIHEAP funding by providing $4.5 billion. Fact sheets are provided for each state and territory receiving funds.
  • SSBCI Application Deadline Approaches: The application deadline for states, territories, the District of Columbia and Tribal governments for the State Small Business Credit Initiative (SSBCI) program is February 11. Application materials can be found here.
  • Education Releases Updated FAQs for Maintenance of Equity Provisions: The Department of Education updated its frequently asked questions (FAQs) for the American Rescue Plan Elementary and Secondary School Emergency Relief (ARP-ESSER) Maintenance of Equity requirements. The update affects Question 32, which addresses local educational agencies excepted from the requirements.
  • Education Updates FAQs for Homeless Children and Youth Program: The Department of Education updated the frequently asked questions (FAQs) for the American Rescue Plan Homeless Children and Youth (ARP-HCY) program. The two new FAQs, labeled as “Date Published: January 2022,” address subgrants to local educational agencies.
  • FNS Approves P-EBT Programs for School Year 2021-2022: The Food and Nutrition Service (FNS) approved an additional state, Wisconsin, to operate a Pandemic Electronic Benefit Transfer (P-EBT) program during school year 2021-2022. To date, a total of 7 states have been approved.
  • Education Approves Florida’s ARP-ESSER State Plan: The Department of Education approved a state plan from Florida for American Rescue Plan Elementary and Secondary School Emergency Relief (ARP-ESSER) funds. The department has approved state plans from all 50 states, the District of Columbia and Puerto Rico.
  • ACF Provides LIHWAP Technical Assistance, Quarterly Report Resources: The Administration for Children and Families (ACF) sent a Dear Colleague letter to Low Income Household Water Assistance Program (LIHWAP) grant recipients. The purpose of the letter is to share newly available training and technical assistance resources including slide decks on data and reporting, intake and eligibility, and intake benefits determination. ACF released a separate letter containing quarterly report instructions and the quarterly report form; the quarterly report submission deadline is January 31, 2022.
  • USDA Releases TEFAP Reach and Resiliency Grant Materials: The U.S. Department of Agriculture (USDA) released grant materials for The Emergency Food Assistance Program (TEFAP) Reach and Resiliency program. State agencies are invited to apply for funding by submitting an application by February 4. The first round of funding includes $50 million, and a second round of grants will be announced at a later date.


Administration Actions Related to COVID-19

  • HHS Releases Guidance for Private Insurance Coverage of COVID-19 Over-the-Counter Tests: The Department of Health and Human Services (HHS) released guidance for the previously announced requirement that insurance companies and group health plans cover the cost of over-the-counter, at-home COVID-19 tests. The requirement begins January 15 and under it, insurance companies and health plans are required to cover 8 free over-the-counter at-home tests per covered individual per month. Consumers can either get it paid for up front by their health plan or get reimbursed for the cost by submitting a claim to their plan. Resources include frequently asked questions and additional details on the requirements.
  • CDC Expands Booster Shot Eligibility, Strengthens Recommendations for Adolescents: The Centers for Disease Control and Prevention (CDC) endorsed the Advisory Committee on Immunization Practices’ (ACIP) recommendation to expand eligibility of booster doses to those 12 to 15 year old. CDC now recommends that adolescents should receive a booster shot 5 months after their initial Pfizer-BioNTech vaccination series. At this time, the Pfizer vaccine is the only one authorized and recommended for adolescents aged 12-17.
  • Supreme Court Hears Oral Arguments on Vaccine Requirements: The Supreme Court heard oral arguments in two cases involving vaccine and vaccine-or-test requirements put into place by the administration, one for certain health care workers and another for large employers (over 100 employees). Provisions of the emergency temporary standard for large employers took effect on Monday, but enforcement of noncompliance with the testing requirements is paused until February 9. This issue brief from the Congressional Research Service gives an update on COVID-19 vaccination mandate litigation.
  • FDA, CDC Shorten Time for Moderna Booster Administration: The Food and Drug Administration (FDA) amended the emergency use authorization for the Moderna COVID-19 vaccine to shorten the time between completion of a primary series and a booster dose to at least five months for individuals 18 years of age and older. The Centers for Disease Control and Prevention (CDC) also adjusted their recommendation, shortening the interval from six months to five months.
  • CDC Updates Isolation Period Guidance for Schools: The Centers for Disease Control and Prevention (CDC) updated their COVID-19 guidance for K-12 schools to reflect new recommendations for isolation for people with COVID-19 and recommendations for people who are close contacts.


IRS Announces Start Date of Tax Filing Season

On Monday the Internal Revenue Service (IRS) announced the tax season will start on January 24, when the tax agency will begin accepting and processing 2021 tax year returns. The filing deadline to submit 2021 tax returns or an extension to file and pay tax owed is Monday, April 18, 2022, for most taxpayers. According to media reports, officials with the Treasury Department warned of potential challenges in processing tax returns due to delays caused by the pandemic, years of budget cuts at the IRS, and federal stimulus measures adding to the agency’s workload.


IIJA Implementation Resources Released

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

  • The administration released links to a series of Department of Transportation program briefings on the IIJA. These briefings address: transit; rail; highways; maritime administration; motor carrier safety; aviation; traffic safety; pipeline and hazardous materials safety; and the Build America Bureau.
  • The Congressional Research Service (CRS) updated its report on drinking water and wastewater infrastructure in the IIJA.
  • The Interior Department (DOI) released a memorandum responding to interest from states on orphan well infrastructure investments. States had until December 30, 2021, to notify the department of interest in applying for a formula grant; 26 states submitted a Notice of Intent indicating interest in applying. DOI will publish the amount of formula grant funding each state will be entitled to apply for, as well as application guidance, in the coming weeks. States are also able to apply at any time for an initial grant of $25 million to begin certain efforts.
  • The Federal Communications Commission (FCC) issued draft rules for the Affordable Connectivity Program (ACP). The ACP would provide eligible households with discounts of up to $30 a month for broadband service, and up to $75 a month if the household is on Tribal lands, and will provide a one-time discount of up to $100 on a computer or tablet for eligible households, as directed under the law.
  • The National Telecommunications and Information Administration (NTIA) released a Request for Comment on broadband programs in the IIJA. The IIJA includes $65 billion to address the digital divide and NTIA is responsible for distributing more than $48 billion through several programs. Questions included in the request address supporting states and territories as well as establishing strong partnerships. Comments are due by February 4.


USDA Announces Increased Funding to Support School Meals

On Friday the U.S. Department of Agriculture (USDA) announced an adjustment in school meal reimbursements to help schools continue to serve healthy and nutritious meals. The adjustment will put an estimated $750 million more into school meal programs this year as schools will receive an additional 25 cents per lunch. According to the department, school lunch reimbursement rates usually do not increase during the school year; however, due to the pandemic, USDA allowed schools to benefit from the highest rates available, which are normally reserved for the USDA Summer Food Service Program. By law, these summer rates adjust for inflation annually in January. A breakdown of support to school districts by state can be found here. A notice and table of the rates can be found here.


HHS Announces Implementation of No Surprises Act

Last week the Department of Health and Human Services (HHS) highlighted implementation of the No Surprises Act. Beginning January 1, 2022, new federal protections implemented under the law ban surprise billing in private insurance for most emergency care and many instances of non-emergency care. The protections also require that uninsured and self-pay patients receive key information, including overviews of anticipated costs and details about their rights. The department also released materials outlining the rule while this issue brief by the Kaiser Family Foundation describes the main components of the No Surprises Act.


FCC Issues Final Rule on Implementing the National Suicide Hotline Improvement Act

Last week the Federal Communications Commission (FCC) published a final rule in the Federal Register for implementation of the National Suicide Hotline Improvement Act of 2018. Under the rule, the FCC requires all covered text providers to support text messaging to 988, the three-digit dialing code to reach the National Suicide Prevention Lifeline, by July 16, 2022. The rule is effective February 4, 2022.


HHS Extends Opioid Crisis Public Health Emergency

The Secretary of Health and Human Services (HHS) recently renewed the determination that a public health emergency exists in relation to the opioid crisis. The declaration is effective January 4 and is a continuation of a public health emergency first declared on October 26, 2017. The most recent renewal was October 6, 2021, that an opioid public health emergency exists nationwide.


FAA Releases List of Airports to Have 5G Buffers

On Friday the Federal Aviation Administration (FAA) released the list of 50 airports that will have buffer zones when wireless companies turn on new 5G service on January 19. Traffic volume, number of low-visibility days, and geographic location factored into the selection. The wireless companies agreed to turn off transmitters and make other adjustments near these airports for six months to minimize potential 5G interference with sensitive aircraft instruments used in low-visibility landings. Information on 5G and aviation safety can be found here.


USDA Expanding Conservation Program Opportunities

Yesterday the U.S. Department of Agriculture (USDA) announced expanded conservation program opportunities to support climate smart agriculture. These opportunities include a new partnership with Farmers For Soil Health to advance the use of soil health practices – especially cover crops – on corn and soybean farms. The department is also investing $38 million through the new targeted Cover Crop Initiative in 11 states (AR, CA, CO, GA, IA, MI, MS, OH, PA, SC, SD) to help agricultural producers mitigate climate change through the widespread adoption of cover crops. Other initiatives include Conservation Incentive Contracts to address priority resource concerns and a Conservation Stewardship Program re-enrollment option that waives the current two-year ineligibility restriction for all applications. The department also announced an investment of $50 million in 118 partnerships through Equity Conservation Cooperative Agreements, to fund two-year projects to expand the delivery of conservation assistance to farmers who are new to farming, low income, socially disadvantaged or military veterans.


DOT Increasing Investment Through Regional Infrastructure Accelerators

The Department of Transportation (DOT) recently announced its Build America Bureau will add $5 million in grants to the Regional Infrastructure Accelerators Demonstration Program, bringing the total investment to $10 million. The Bureau issued a Notice of Funding Opportunity to solicit applications for grants to designate Accelerators that will serve defined geographic areas, provide technical resources, and fund planning and development activities to expedite project delivery through the Bureau’s loan programs and other innovative financing methods, including public-private partnerships. Applications are due April 11. In the first round of Accelerators, announced last September, the Bureau selected five Regional Infrastructure Accelerators: Fresno, CA, Chicago, IL, Cleveland, OH, San Diego, CA and Seattle, WA, totaling $5 million.


ACF Announces CSBG 2nd Quarter Allocations

Last week the Administration for Children and Families (ACF) provided an update on allocations of Community Services Block Grant (CSBG) funding during the second quarter of fiscal year 2022. On December 3, the Further Extending Government Funding Act was signed into law, providing funding for the federal government through February 18. This release reflects a second allocation of CSBG funds in the amount of $180 million. State and territory allocations can be found here.


EPA Releases Draft Environmental Justice Plan for Land Protection and Cleanup Programs

Last week the Environmental Protection Agency (EPA) released a draft Environmental Justice (EJ) action plan for the agency’s land protection and cleanup programs. The action plan highlights projects, tools, and practices to be applied to Office of Land and Emergency Management programs, including Superfund, Brownfields, Emergency Response, Solid Waste Management and Corrective Action, and Underground Storage Tanks. The draft plan covers projects and activities intended to address land cleanup issues in overburdened communities across the country.


Recently Released Reports

Federal Grants to States and Local Governments Under Continuing Resolutions

Congressional Research Service

State Governance, Planning, and Financing to Enhance Energy Resiliency

National Governors Association

Federal Highway Administration Should Develop and Apply Criteria to Assess How Pilot Projects Could Inform Expanded Use of Mileage Fee Systems

U.S. Government Accountability Office


Economic News

Unemployment Claims Reported for Week Ending January 1

The U.S. Department of Labor released unemployment insurance weekly claims data last Thursday that showed for the week ending January 1, the advance figure for seasonally adjusted initial claims was 207,000. This is an increase of 7,000 from the previous week’s revised level, which was revised up by 2,000 from 198,000 to 200,000. The 4-week moving average was 204,500, an increase of 4,750 from the previous week's revised average. The advance seasonally adjusted insured unemployment rate was 1.3 percent for the week ending December 25, unchanged from the previous week’s unrevised rate. The advance number of actual initial claims under state programs, unadjusted, totaled 315,469 in the week ending January 1, an increase of 57,599 (or 22.3 percent) from the previous week.


Economy Adds 199,000 Jobs in December

New data released last week by the U.S. Bureau of Labor Statistics showed that total nonfarm payroll employment increased by 199,000 in December and the unemployment rate declined by 0.3 percentage point to 3.9 percent. This is below most economists’ predictions of approximately 420,000 jobs added. The data also shows that in December there were 6.3 million unemployed persons, down by 483,000. The number of long-term unemployed (jobless for 27 weeks or more) declined by 185,000 to 2.0 million, accounting for 31.7 percent of the total unemployed. The labor force participation rate was unchanged at 61.9 percent and remains 1.5 percentage points lower than in February 2020. Among those not in the labor force in December, 1.1 million persons were prevented from looking for work due to the pandemic, little changed from November. In December, job gains occurred in leisure and hospitality (53,000), professional and business services (43,000), manufacturing (26,000), construction (22,000) and transportation and warehousing (19,000). Employment showed little or no change in retail trade, information, financial activities, health care, other services, and government. State government jobs showed no change, with decreases in state government excluding education (-5,100) offsetting increases in state government education (+5,000). The change in total nonfarm payroll employment was revised up for October (+102,000) and November (+39,000).