federal funding update: the craziest year yet gpa national conference october 18, 2012 federal funds...
DESCRIPTION
The Federal Budget ProblemTRANSCRIPT
Federal Funding Update: The Craziest Year Yet
GPA National ConferenceOctober 18, 2012
Federal Funds Information for States
Overview
The Federal Budget ProblemStatus of FY 2013 AppropriationsLame Duck SessionWhat Does it Mean for States and
Federal Grants?
The Federal Budget Problem
Where the Money Goes: Pieces of the Federal Budget Pie
Composition of Federal Outlays in FY 2011($ in Billions, % of Total)
State/Local Grants by Program Area
Federal Outlays to State and Local Governments, FY 2011($ in Billions, % of Total)
FY 2013 Budget: Congress Approves Six-Month Continuing Resolution
FY 2012 + 0.612% for most discretionary programs (not highways)
Mandatory programs: current-law levelExtends SNAP, TANF, related programsAdditional funds for a few programs What happens after March 27, 2013?
FY 2013 Appropriations: At What Cost to States?
FY 2013 vs. FY 2012
Federal Agency FY 2012 vs. FY 2010 CR House Senate
Education -1.1% 0.6% n/a 0.5%
Health and Human Services
-5.6% 1.1% n/a 1.2%
Housing and Urban Development
-5.4% 0.6% 2.4% 5.2%
Energy/EPA -33.2% 0.6% -36.2% 3.1%
Justice -40.9% 0.6% -6.0% 6.9%
Homeland Security -35.4% 0.6% 27.2% 3.5%
Labor -4.9% 0.6% n/a -2.9%
Transportation -9.0% 0.2% -0.3% 0.3%
“To Do” List for Lame Duck Congress
Address the BCA’s looming sequesterDeal with expiring tax provisionsConsider other expiring legislation,
authorizationsRaise the debt limitReassure markets and American consumers
CBO Estimates of the Fiscal Cliff
$0
$500
$1,000
$1,500
$2,000
$2,500
$3,000
$3,500
$4,000
$4,500
2011 2012 2013 2014 2015 2016 2017
$ in
bill
ions
Fiscal Year
The Fiscal Cliff
Revenues Expenditures
The BCA and the Sequester
Absent a legislated alternative, a sequester will occur on January 2, 2013
Many mandatory and a few discretionary programs are exempt– OMB report sheds light on its interpretations
OMB estimates of ATB cuts: 8.2% (nondefense discretionary), 7.6% (nondefense mandatory), 9.4% (defense discretionary)
ATB reduction applied to FY 2013 funding in effect on January 2, 2013 (CR level)
Sequester Coverage Status of 216 FFIS-Tracked Programs
Sequester Coverage Status of $606 Billion FFIS-Tracked Funding
Program Areas Most Affected
Budget Function % of Funding Covered by Sequester
Agriculture 100%Employment and Training 100%Community Development 100%Justice 100%General Gov’t 89%Energy, Env., Natural Resources 89%Education 54%Income Security and Social Services 23%Transportation 4%Health 3%
The Conventional Wisdom Keeps Changing
For appropriations, from another CR to an omnibus
For BCA, from agreeing to postpone the day of reckoning, to sequester
For expiring tax provisions, from extending some tax cuts to allowing all to expire
For authorizations, from completing some to extensions
What Does this Mean for States?If Congress Goes for It…..
“Grand Bargain” means greater certainty but less funding. Likely changes include:– Reforms to entitlement programs (flexibility
vs. funding)– Further reductions in discretionary
spending– Revenue effects from tax overhaul
What Does this Mean for States?If Congress Punts…..
States continue to face uncertaintyFY 2013 budget won’t happen anytime
soon– President’s FY 2014 budget released
before FY 2013 budget is finalizedProgram extensions continue In short, more of the same
The End: Questions?
Contact information: Trinity Tomsic202-624-8577, [email protected]