September 16, 2021

House Panels Advance Budget Reconciliation Legislation; WH Announces Initial Round of Afghan Resettlement

This week, a number of congressional committees met to complete their respective titles of a legislative package that reflects key elements of President Biden’s American Families Plan. Pursuant to the fiscal year 2022 budget resolution (S Con Res 14), 13 House committees were given a September 15 deadline to advance their portions of the plan. Prior to being considered on the House Floor, the various measures will be compiled into a single package by the House Budget Committee. Looking ahead, the earliest the chamber will consider the legislation is during the week of September 20; however, this timeline could easily slip to the week of September 27 or early October.

Despite the apparent progress at the committee level, there is still disagreement regarding the top-line spending figure for the bill. While Democratic leaders are moving forward with a package totaling $3.5 trillion, moderates in the caucus are uncomfortable with that level of spending. Notably, Senators Joe Manchin (D-WV) and Kyrsten Sinema (D-AZ), whose votes will be crucial in the evenly split Senate, have both balked at the measure’s price tag. For his part, Senator Manchin publicly renewed his objection to the multi-trillion dollar proposal this past week and has indicated that he would only be willing to support up to $1.5 trillion in spending.

Below are select highlights from the recent House Committee action.

House Agriculture Committee

The Agriculture Committee’s bill would dedicate $40 billion for forestry programs, including $14 billion for hazardous fuels treatments across the National Forest System and adjacent lands and $9 billion in forest restoration and wildfire resilience grants for non-federal lands. It also includes more than $18 billion in rural development funding, including nearly $10 billion for rural communities and rural electric co-ops to transition to renewable energy practices; $2.6 billion for the Rural Energy for America Program (REAP) program, which provides grants and loans to farmers and small business owners to make energy efficient improvements for their operations; and, $4 billion for a new Rural Partnership Program, which would provide flexible grant funding for rural communities to support job growth, build economic resilience, and aid economic recovery in communities impacted by economic transitions and climate change. Additional information on the committee action is available here.

House Energy and Commerce Committee

The legislation would provide Medicaid eligibility for incarcerated persons 30 days prior to their release. The bill also would give states the option of expanding Medicaid home and community based care (HCBS). States choosing to expand HCBS care would be provided with a permanent seven percentage point increase in the federal match. It should be noted that the federal government would provide an 80 percent match for administrative costs. The legislation also would allocate $130 million to fund states’ preparation of HCBS plans.

Additionally, the bill would appropriate $7 billion for improving core public health activities, with 50 percent of the funding directed to counties with a population above two million people and 25 percent available in the form of competitive grants to local health departments. States receiving funding would need to allocate no less than 25 percent to local health departments. Additional information on the committee’s bill can be accessed here.

House Financial Services Committee

The Financial Services Committee would make massive investments in housing, including providing $80 billion for public housing over the next ten years. In addition, the legislation would provide $72 billion for the HOME Investments Partnership program and $8.5 billion for the Community Development Block Grant (CDBG) program. The bill also includes $9.6 billion for a new Housing Investment Fund to increase the supply of affordable housing. Additionally, the measure would appropriate $75 billion over ten years to create more housing vouchers and would create a $7.5 billion Community Restoration and Revitalization Fund to build family affordable housing units and prevent residential displacement. Additional information on the committee action can be found here.

House Judiciary Committee

The Committee’s bill would provide a pathway to permanent residence for so-called Dreamers (undocumented immigrants brought to the U.S. as children), those with temporary protected status, farmworkers, and other essential workers. However, it’s unclear if these provisions will be eligible for inclusion under the complex budget reconciliation process. The Senate Parliamentarian will ultimately decide whether the proposal complies with the so-called Byrd Rule, which prohibits provisions that do not directly impact the federal budget from passing via reconciliation.

In addition to the citizenship provisions, the bill would provide $2.5 billion in community violence intervention programs at the Department of Justice.  The funds provided under this measure would also support training, technical assistance, research, evaluation, and data collection on the strategies that are most effective at reducing community violence and ensuring public safety. An archived webcast of the panel’s markup can be viewed here.

House Transportation & Infrastructure Committee

Affordable Housing Access Program

The legislation would provide $10 billion to support access to affordable housing and enhance mobility for low-income individuals and residents of disadvantaged or persistent poverty communities. Competitive grants would be administered jointly through HUD and the Federal Transit Administration.

Neighborhood Access and Equity Grants

The bill includes $4 billion for competitive grants to reconnect communities divided by existing infrastructure barriers, mitigate negative impacts of transportation facilities or construction projects on disadvantaged or underserved communities, and support equitable transportation planning and community engagement activities.

Community Climate Incentive Grants

The legislation would invest $4 billion to reduce surface transportation-related greenhouse gas (GHG) emissions. Of the funding, the bill would provide $3 billion for non-state entities for projects to reduce carbon emissions; $950 million for incentive grants to states that make significant progress in reducing emissions or that adopt strategies to achieve net-zero surface transportation emissions by 2050; and, $50 million for the Federal Highway Administration to establish a GHG performance measure and for other purposes.

Local Transportation Priorities

The bill includes $6 billion to advance local surface transportation projects. Notably, the funding would be reserved for the Member-Designated Projects (formally known as earmarks) that were included in the committee’s FAST Act reauthorization legislation (HR 3684).

Federal Emergency Management Agency

The legislation would designate $425 million for Emergency Operations Centers. FEMA would award grants for construction, retrofit, technological enhancement, and updated planning requirements of state, local, tribal, and territorial emergency operations centers. In addition, $300 million would be made available for grants to state, local, tribal, and territorial governments for implementation and enforcement activities of the latest published editions of relevant performance-based and consensus-based codes, specifications, and standards that incorporate hazard-resistant designs and the latest requirements for the maintenance and inspection of existing buildings to address hazard risk. The grants would not be subject to any non-federal cost share. Finally, the measure would provide $500 million for FEMA’s Hazard Mitigation Revolving Loan Fund.

Water Resources

The bill would provide $495 million to support small, rural, and other economically challenged communities in meeting the technical and financial requirements of the Clean Water Act. Another $125 million would be available for Alternative Water Source Project Grants to support investment in alternative water source projects, including projects for groundwater recharge and potable reuse.

Additional information on the committee’s action can be found here.

House Ways and Means Committee

The Ways and Means Committee package includes sweeping tax changes that would raise revenue for other portions of the plan. The panel’s proposal would raise the top corporate tax rate from 21 percent to 26.5 percent. It should be noted that this is less than the 28 percent that President Biden had sought. The top rate on capital gains would rise from 20 percent to 25 percent, which would also be lower than the level (39.6 percent) proposed by Biden. The measure would raise the top individual tax rate from 37 percent to 39.6 percent and would impose a three percent surtax on income above $5 million. While not included in the base package, Democrats are also planning to add some type of change to the $10,000 cap on the state and local tax (SALT) deduction.

In addition, the legislation includes other tax provisions and funding opportunities designed to aid certain households. This includes extending an expanded version of the child tax credit through 2025 and making it permanently refundable. The measure would also provide $400 million through fiscal year 2025 for state and county adult protective services programs.

Furthermore, the bill includes a number of tax benefits for local governments, including restoration of a tax exemption for interest on advance refunding bonds, which was repealed by the 2017 tax overhaul (PL 115-97). It also would establish a 30 percent tax credit for state, local, and tribal governments to operate and maintain government-owned broadband systems.

Finally, the legislation would provide up to 12 weeks of paid leave for eligible workers for the birth or adoption of a child, a personal health condition, caring for a family member, circumstances related to a family member’s deployment, and bereavement. Pursuant to the bill, benefits would be administered by the Treasury Department and would begin in July 2023.

More info on the markup can be found here.

House Natural Resources Committee

The committee’s bill includes $250 million for a new Aquatic Ecosystem Restoration program that would allow state, regional, and local authorities to fund projects to improve the health of fisheries, including habitat restoration and improved fish passage. It also includes $1.15 billion for emergency drought relief activities and $900 million to reduce wildfire risk on landscapes and communities through fire preparedness, fire science and research, emergency rehabilitation, rural fire assistance, fuels management activities, the renovation or construction of fire facilities, and for expenses necessary to support firefighter workforce reforms.

Additional information on the committee’s bill can be accessed here.

House Education and Labor Committee

The panel’s bill would dedicate $111 billion to providing tuition-free community college. Over the next five years, the measure would provide $15 billion for adult employment and training and $9 billion for youth employment training, with the appropriation for each more than triple the funding currently available annually.

In addition, the legislation would make a significant investment in child care. Under the bill, roughly $90 billion in child care certificates for free child care would be available to families earning 100 percent or less of their state’s median income – a co-pay of up to two percent would be required. Eligibility for the certificates would be phased out after 200 percent of the state median income, with a co-pay of seven percent.

With regard to nutrition, the threshold for the Community Eligibility Provision – providing free school meals to all children in a low-income school – would be lowered from 40 percent of low-income students eligible for free or reduced-price meals to 25 percent.

Additional information on the committee’s proposal can be found here.

California to Receive Afghan Evacuees in Initial Round of Resettlements

This week, White House officials announced that an initial group of 37,000 Afghan evacuees will be resettled in the United States. According to projections, California will be resettling roughly 5,255 individuals in this first round. While their immigration pathway is still unclear, the Biden administration has requested $6.4 billion to help with Afghan resettlement in the upcoming continuing appropriations bill. Of that amount, $1.6 billion would be allocated to the Department of Health and Human Service’s Refugee and Entrant Assistance program to support housing, case management, English language classes, job training, cash and medical assistance, and other integration services.