Budget Blog

February 8, 2022 - Washington Report

By Leah Wavrunek posted 02-08-2022 04:38 PM


This Week on the Hill  

The House and Senate are in this week, with two weeks remaining before the current continuing resolution (CR) funding the federal government expires on February 18.

On Monday, House Democrats introduced a third CR that would fund the government through March 11 to give negotiators more time to complete a fiscal year 2022 omnibus spending bill. The third CR continues funding at current levels and provides “anomalies” including: $350 million to the Department of Defense to respond to water contamination in Hawaii; extends the temporary emergency scheduling order placing fentanyl-related substances in Schedule I of the Controlled Substances Act through March 11; and extends the current federal medical assistance percentage (FMAP) for certain territories through March 11. A section-by-section summary can be found here and legislative text here. The House is expected to vote on the bill this week.


Application Deadline for Treasury SSBCI Program is February 11

The capital programs application deadline for states, territories and Washington, D.C. under the Treasury Department’s State Small Business Credit Initiative (SSBCI) is February 11. Application materials, including a user guide and instructions, can be found here. Frequently asked questions for the program can be found here. The American Rescue Plan Act (ARPA) provided $10 billion to fund the program, which will fund state, territory and Tribal government small business credit support and investment programs.


Updated Guidance Allows States to Use SLFRF and CRF to Meet MOE Requirements

On Friday the U.S. Department of Education updated its guidance on maintenance of effort (MOE) requirements under the Elementary and Secondary School Emergency Relief (ESSER) Fund and the Governor’s Emergency Education Relief (GEER) Fund. Consistent with the final rule on Coronavirus State and Local Fiscal Recovery Funds (SLFRF) issued by the Treasury Department, Education is permitting states to include both Coronavirus Relief Funds (CRF) awarded under the CARES Act and SLFRF under the American Rescue Plan Act (ARPA) that are spent on K-12 education or higher education, as applicable, for determining state support for education to comply with MOE requirements. According to the updated guidance, “A State may include SLFRF funds up to the State’s calculated amount of COVID-related losses in revenue, that are spent on elementary and secondary education or higher education, as applicable, as State support for education to meet” MOE requirements. See Question 3(a) on page 8 of the updated guidance document for more details.


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).

  • HHS Announces $66.5 Million to Expand Vaccine Outreach Efforts: The Department of Health and Human Services (HHS) announced $66.5 million in ARPA funding to eight grantees to expand outreach efforts in 38 states and the District of Columbia to increase COVID-19 vaccine confidence and vaccinations.
  • HRSA Announces $19.2 Million for Training New Residents: The Health Resources and Services Administration (HRSA) announced the availability of $19.2 million in ARPA funding to support and expand community-based primary care residency programs under the Teaching Health Center Graduate Medical Education program. Awardees will use the funding to train residents to provide quality care to diverse populations and communities, particularly in underserved and rural areas; funds will support the equivalent of approximately 120 full-time resident positions.
  • ACF Releases Brief on Use of the Pandemic Emergency Assistance Fund for Utility Assistance: The Administration for Children and Families (ACF) released a brief entitled Responding to Winter Utility Needs: Using the Pandemic Emergency Assistance Fund. ARPA authorized this $1 billion fund to provide certain non-recurrent, short-term benefits. The brief discusses the potential for using the fund to support needy families affected by the COVID-19 pandemic and by unusually high heating costs this winter. Other actions taken by the administration to address energy bills can be found here.
  • DOL Updates Guidance on Waiving Recovery of Certain UI Benefits Overpayments: The Department of Labor (DOL) issued Unemployment Insurance Program Letter No. 20-21, Change 1, to provide additional instructions for states to address overpayments under the CARES Act’s Unemployment Compensation programs when the claimant is not at fault. The letter also describes the required collection activities for overpayments which are not eligible for a waiver of recovery.
  • Treasury Updates Status of Payments to States for NEUs: The Treasury Department continues to update the Status of Payments to States for Distribution to Non-Entitlement Units of Local Government (NEUs). The data is updated through February 7 and includes first tranche data, invoice date, and first through eighth 30-day extensions granted.
  • CRS Releases Report on Education Stabilization Fund Programs: The Congressional Research Service (CRS) released a report examining Education Stabilization Fund programs funded by three relief bills: the CARES Act, December relief bill, and ARPA. The report looks at funding across programs, Maintenance of Effort and Maintenance of Equity requirements, and reporting requirements.
  • HRSA Publishes Fact Sheet Highlighting Health Workforce Initiatives: The Health Resources and Services Administration (HRSA) released a fact sheet highlighting initiatives to support and grow the health workforce. These include multiple funding awards, planning and research, and stakeholder engagement. The fact sheet also includes information on forthcoming funding opportunities in fiscal year 2022.
  • Education OIG Releases Information on Protecting Against Waste, Fraud and Abuse: The Department of Education Office of Inspector General (OIG) presented information to grantees on protecting COVID-19 response funds from fraud, waste, and abuse. Materials include a presentation, fact sheet, and framework for managing fraud risks in federal programs.
  • FEMA Updates Funeral Assistance State and Territory Data: The Federal Emergency Management Agency (FEMA) updated its COVID-19 funeral assistance data, showing that the agency has provided over $1.78 billion to more than 273,000 people to assist with COVID-19-related funeral costs for deaths occurring on or after January 20, 2020. State and territory specific information is included in the press release.
  • ACF Releases LIHWAP Intake Benefits Toolkit: The Administration for Children and Families (ACF) released a toolkit to support Low Income Household Water Assistance Program (LIHWAP) recipients with procedural considerations related to applications, intake of potential LIHWAP clients, eligibility determination, and benefit determination and notifications.


Administration Actions Related to COVID-19

  • Pfizer-BioNTech Seeks EUA from FDA for COVID-19 Vaccine for Children Six Months through Four Years of Age: Pfizer Inc. and BioNTech announced the companies have initiated a rolling submission seeking to amend the Emergency Use Authorization of its COVID-19 vaccine to include children 6 months through 4 years of age. The application is for authorization of the first two doses of a planned three-dose primary series in this age group. The Food and Drug Administration (FDA) announced a virtual meeting of its Vaccines and Related Biological Products Advisory Committee on February 15 to discuss the request.
  • CMS Announces Plan to Cover COVID-19 At-Home Tests for Medicare Beneficiaries: The Centers for Medicare and Medicaid Services (CMS) announced that people in either Original Medicare or Medicare Advantage will be able to get over-the-counter COVID-19 tests at no cost starting in early spring. Under the new initiative, Medicare beneficiaries will be able to access up to eight tests per month for free, with tests available through eligible pharmacies and other participating entities. Additional information can be found here.
  • USDA Issues Transitional Nutrition Standards for Upcoming School Years: The U.S. Department of Agriculture (USDA) announced updates to the school nutrition standards to provide schools a clear path forward from the pandemic. These include transitional standards that will begin in school year (SY) 2022-2023 and that USDA intends to run through SY 2023-2024; the department will engage stakeholders to establish long-term nutrition standards beginning in SY2024-2025. The new final rule – Child Nutrition Programs: Transitional Standards for Milk, Whole Grains, and Sodium – establishes the requirements for the upcoming school year. USDA also released a webpage and fact sheet.
  • CDC Fully Approves Moderna COVID-19 Vaccine: Following action by the Food and Drug Administration (FDA) last week to approve the Moderna COVID-19 vaccine for people ages 18 years and older, the Director of the Centers for Disease Control and Prevention (CDC) endorsed its advisory committee’s recommendation for use of the vaccine for that age group, resulting in a second fully approved COVID-19 vaccine.
  • HHS Issues New Guidance to Health Care Providers on Civil Rights Protections for People with Disabilities During the Pandemic: The Department of Health and Human Services (HHS) issued guidance to health care providers on civil rights protections for people with disabilities. The guidance clarifies that federal civil rights laws apply to health care providers, including those administering COVID-19 testing, medical supplies, and medication. Additionally, the laws apply to state Crisis Standard of Care plans, procedures, and related standards for triaging scarce resources. Frequently asked questions on the requirements can be found here.


IIJA Implementation Resources Released

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

  • The Department of Transportation (DOT) released a toolkit to help rural communities take advantage of federal funding for electric vehicle (EV) charging stations. The guide can help connect community members, towns, businesses, planning agencies, and others with partners needed for these projects. The IIJA includes a total of $7.5 billion to build out a nationwide network of 500,000 EV chargers. The department will host a webinar to present the toolkit in more detail on February 9 at 1:30pm ET; register here.
  • The National Telecommunications and Information Administration (NTIA) announced a series of IIJA broadband grant program webinars. The pre-Notice of Funding Opportunity technical assistance webinars will be held March-May and are designed to help prospective applicants understand NTIA’s IIJA broadband grant programs and to assist applicants in preparing high quality grant applications.
  • The Secretary of Commerce testified before the Senate Appropriations Subcommittee on Commerce, Justice and Science regarding implementation of IIJA departmental broadband programs. Themes of the testimony, as well as questions and answers, included the prioritization of unserved areas, flexibility and stakeholder engagement. She noted there is a single point person at NTIA in charge of each state and encouraged states to begin their work now by examining permitting, job training, and stakeholder outreach. The Secretary’s written testimony can be found here.
  • The Federal Transit Administration (FTA) announced that more than $4.7 billion in fiscal year 2022 transit formula funding is now available to transit agencies, states, and Tribal governments to support public transportation. The funds were made available under the continuing resolution that runs through February 18 and also include funding identified as advance appropriations in IIJA for fiscal year 2022 State of Good Repair and Enhanced Mobility of Seniors and Individuals with Disabilities formula programs. Full year funding will be available once Congress passes a fiscal year 2022 appropriations bill. Apportionment tables, covering the first 4.5 months of fiscal year 2022, can be found here.
  • The Department of the Interior (DOI) announced that nearly $725 million in fiscal year 2022 funding is available to 22 states and the Navajo Nation for reclaiming abandoned mine lands (AML) as part of IIJA. The law allocates a total of $11.3 billion in AML funding over 15 years. States are guaranteed at least $20 million over the 15-year life of the program if their inventory of AML sites would cost more than $20 million to address. A list of AML eligibility by state is included in the press release.
  • The Federal Highway Administration (FHWA) released new guidance to implement changes in its signature highway safety funding program, which received substantial new funding under the IIJA. In the guidance, FHWA outlines several changes to its Highway Safety Improvement Program (HSIP) that can help state, local, and Tribal transportation agencies save lives on the roads and bridges they own and operate. The guidance also implements the IIJA provisions to help vulnerable road users who are considered to be most at risk for being involved in traffic crashes that result in fatalities.
  • The Federal Communications Commission (FCC) announced the formation of a cross-agency task force that will focus on creating rules and policies to combat digital discrimination and to promote equal access to broadband across the country. The IIJA requires the FCC to adopt final rules to facilitate equal access to broadband service that prevents digital discrimination, which must be completed by November 2023.
  • The Federal Railroad Administration (FRA) posted a Request for Information on the newly created Corridor Identification and Development Program. This program creates a new framework to facilitate the development of new, enhanced, and restored intercity passenger rail corridors through the country. FRA is seeking comments on the program and how it can best serve stakeholders and the public; comments are due by March 9.


House Passes America COMPETES Act

On Friday the House voted 222-210 to approve the America COMPETES Act of 2022 (H.R. 4521). The bill is intended to increase U.S. production of semiconductor chips, strengthen the supply chain for domestic manufacturing, and invest in scientific research and new technologies. The legislation includes $52 billion to support U.S. production of semiconductors, along with $45 billion for supply chains. Last year the Senate passed its version, the U.S. Innovation and Competition Act (S. 1260); a conference committee is expected to be formed to reconcile differences between the bills. A side-by-side summary of the bills can be found here.


Attorney General Announces New Actions to Address Violent Crime

Last week the U.S. Attorney General (AG) announced a series of actions the Department of Justice will take to address violent crime. These actions include a series of directives to all U.S. Attorneys’ offices to prioritize combating violent crime, a national convening of police executives to collaborate on gun violence solutions, launching a national drug-related violence reduction initiative, announcing plans to mobilize its Project Safe Neighborhoods and Public Safety Partnership initiatives to support local leaders in addressing violent crime, launching a national ghost gun enforcement initiative, and cracking down on illegal firearms trafficking. 


DOJ, HHS Announce Actions to Combat Human Trafficking

The Departments of Justice (DOJ) and Health and Human Services (HHS) recently announced actions to combat human trafficking. The Department of Justice published the National Strategy to Combat Human Trafficking, which focuses on prevention, prosecution of cases, protection of victims and survivors, and partnership at every level of government. The Secretary of HHS announced the formation of the HHS Task Force to Prevent Human Trafficking to strengthen the department’s human trafficking prevention and intervention efforts with a focus on partnerships, equity, and open data. Both actions support the President’s National Action Plan to Combat Human Trafficking, released in December 2021.


USDA Announces $1.4 Billion To Strengthen Rural Economies

Last week the U.S. Department of Agriculture (USDA) announced an investment of $1.4 billion in grants and loans to support rural economies through job training, business expansion and technical assistance. The funding will help people and businesses in diverse communities and industries throughout 49 states, the Virgin Islands and Puerto Rico. The funding will support 751 investments across eight programs specifically designed to create economic opportunities for people and businesses in rural areas.


HHS Announces New Grant Program for Pregnant Women, Children Affected by Substance Use

On Thursday the Department of Health and Human Services (HHS) released a new series of reports on substance-exposed pregnancies that highlight how pregnant and postpartum women who use substances and their children can benefit from evidenced-based prevention and treatment strategies. The Substance Abuse and Mental Health Services Administration (SAMHSA) has begun accepting applications for the Services Grant Program for Residential Treatment for Pregnant and Postpartum Women. This $10 million grant program will provide pregnant and postpartum women and their children with comprehensive substance use treatment and recovery support services across residential and outpatient settings. In addition, for the first time this year, the program will extend services to fathers, partners, and other family members. Applications are due by April 4.


USDA Announces $1 Billion Investment in Climate-Smart Commodities

On Monday the U.S. Department of Agriculture (USDA) Secretary announced an investment of $1 billion in the new Partnerships for Climate-Smart Commodities. The initiative will finance pilot projects that create market opportunities for agricultural and forestry products that use climate-smart practices and include innovative, cost-effective ways to measure and verify greenhouse gas benefits. For the purposes of this funding opportunity, a climate-smart commodity is defined as an agricultural commodity that is produced using agricultural (farming, ranching or forestry) practices that reduce greenhouse gas emissions or sequester carbon. Funding is provided through the Commodity Credit Corporation; eligible applicants include state governments and institutions of higher education. Applications for the first funding pool are due by April 8.


EPA Announces $3.8 Million for Brownfields Job Training Grants

Last week the Environmental Protection Agency (EPA) announced the selection of 19 organizations to receive $3.8 million in grants for job training programs to help prepare over 1,000 individuals for new environmental jobs. Funded through the Brownfields Job Training Program, these grants provide funding to organizations that are working to create a skilled workforce in communities where assessment, cleanup, and preparation of brownfield sites for reuse activities are taking place. Each selected grantee will receive approximately $200,000; a list of grantees is included in the press release.


For Your Information

DOL Releases Planning Estimates for WIOA Program Allotments

The Department of Labor (DOL) released Training and Employment Notice No. 20-21 to transmit to states and outlying areas planning estimates for Workforce Innovation and Opportunity Act (WIOA) Title I Youth, Adult and Dislocated Worker program allotments for program year 2022. The estimated allotment levels show the impact of updated unemployment data on allotments for program year 2022 to use for planning purposes.


Education Revamps College Scorecard

The Department of Education released updates to the College Scorecard to help students, families, school counselors, college access providers, researchers, and other critical stakeholders. The department improved the College Scorecard interactive web tool and restored several metrics that help students gauge how their prospective institution compares to other colleges across costs, graduation rates, post-college earnings, and more.


President Signs Executive Order on Project Labor Agreements

The President signed an Executive Order requiring project labor agreements (PLAs) for federal construction contracts that cost at least $35 million. PLAs are a pre-hire collective bargaining agreement with one or more labor organizations that establishes the terms and conditions of employment for a specific construction project. Within 90 days, the Secretary of Defense, Secretary of Labor, and Director of the Office of Management and Budget must coordinate in designing a training strategy for agency contracting officers; within 120 days, regulations shall be proposed implementing provisions of the executive order. A fact sheet can be found here.


HHS Announces Standard Definition for Opioid Withdrawal in Infants

The Department of Health and Human Services (HHS) announced the development of a standard clinical definition for opioid withdrawal in infants to help improve care. Lacking a standard clinical definition for the past 45+ years has been a historical gap in the care of mothers and infants affected by opioid exposure and created inconsistencies in diagnosing infants. The new standard clinical definition for diagnosis includes prenatal exposure and specific evidence-based clinical signs such as excessive crying, fragmented sleep, tremors, increased muscle tone, and gastrointestinal disfunction.


DEA Launches Initiative to Combat Drug-Related Violence and Overdoses

The Drug Enforcement Administration (DEA) announced a new initiative, Operation Overdrive, aimed at combatting the rising rates of drug-related violent crime and overdose deaths in communities. DEA, working in partnership with federal, state and local law enforcement agencies, has mapped threats and initiated operations against criminal drug networks in 34 locations across 23 states in the initial phase of Operation Overdrive. A list of Phase I locations is included in the press release.


Recently Released Reports

Prescription Drugs: Spending, Use and Prices

Congressional Budget Office

Addressing and Avoiding Severe Fiscal Stress in Public Pension Plans

Urban Institute

State Legislatures Take Up Tax Reform in 2022

Tax Foundation

National Survey Trends in Telehealth Use in 2021: Disparities in Utilization and Audio v. Video Services

U.S. Department of Health and Human Services


Economic News

Unemployment Claims Reported for Week Ending January 29

The U.S. Department of Labor released unemployment insurance weekly claims data last Thursday that showed for the week ending January 29, the advance figure for seasonally adjusted initial claims was 238,000. This is a decrease of 23,000 from the previous week’s revised level, which was revised up by 41,000 from 260,000 to 261,000. The 4-week moving average was 255,000, an increase of 7,750 from the previous week's revised average of 247,250. The advance seasonally adjusted insured unemployment rate was 1.2 percent for the week ending January 22, unchanged from the previous week’s unrevised rate. The advance number of actual initial claims under state programs, unadjusted, totaled 257,002 in the week ending January 29, a decrease of 11,728 (or -4.4 percent) from the previous week.


Economy Adds 467,000 Jobs in January

New data released last week by the U.S. Bureau of Labor Statistics showed that total nonfarm payroll employment increased by 467,000 in January and the unemployment rate was little changed at 4.0 percent. The data also shows that in January there were 6.5 million unemployed persons, up slightly from 6.3 million in December. The number of long-term unemployed (jobless for 27 weeks or more) declined to 1.7 million, accounting for 25.9 percent of the total unemployed. The labor force participation rate held at 62.2 percent and remains below the level in February 2020. Among those not in the labor force in January, 1.8 million persons were prevented from looking for work due to the pandemic, up from 1.1 million in the prior month. In January, notable job gains occurred in leisure and hospitality (151,000), professional and business services (86,000), retail trade (61,000), transportation and warehousing (54,000), and local government education (29,000). Employment showed little or no change in mining, construction, manufacturing, information, financial activities, and other services. State government jobs decreased by 9,000, with decreases in both state government excluding education (-7,400) and state government education (-900). The change in total nonfarm payroll employment was revised up for November (+398,000) and December (+311,000).


Personal Income Rises 0.3 Percent in December

Personal income increased $70.7 billion (0.3 percent) in December according to estimates recently released by the Department of Commerce Bureau of Economic Analysis. Personal income is defined as the income received by, or on behalf of, all persons from all sources. Disposable personal income increased $39.9 billion (0.2 percent) and personal consumption expenditures decreased $95.2 billion (0.6 percent). The increase in personal income in December primarily reflected increases in compensation that was partly offset by a decrease in proprietors’ income. Within compensation, the increase reflected increases in both private and government wages and salaries. Personal outlays decreased $93.5 billion in December, while personal saving was $1.44 trillion, and the personal savings rate (personal saving as a percentage of disposable personal income) was 7.9 percent.


Job Openings Little Changed at 10.9 Million in December

The number of job openings was little changed at 10.9 million on the last business day of December, according to data recently released by the U.S. Department of Labor. Job openings increased in December for accommodation and food services (+133,000), information (+40,000), nondurable goods manufacturing (+31,000) and state and local government education (+31,000) but decreased in finance and insurance (-89,000) and wholesale trade (-48,000). The number of hires decreased to 6.3 million (-333,000) and the hires rate was little changed at 4.2 percent. The number of separations decreased to 5.9 million (-305,000). The 4.3 million quits reported in December were down slightly (-161,000) following a series high in November; many economists closely watch the number of quits as a measure of employee confidence in finding another job. Finally, layoffs and discharges were little changed at 1.2 million. Over the 12 months ending in December, hires totaled 75.3 million and separations totaled 68.9 million, yielding a net employment gain of 6.4 million.