Budget and Revenue Standing Committee

Federal Budget and Revenue Update

June 4, 2007
Volume 13, Number 8

An Information Service of the NCSL Budgets and Revenue Committee

Supplemental Appropriations

On May 25, the President signed the $120 billion emergency supplemental spending bill (H.R. 2206). The bill included $108.9 million to fund military operations, with $1.55 billion in economic aid to Iraq subject to various benchmarks; $3.0 billion for agricultural disaster assistance; $1.8 billion for veterans care; $3.4 billion for Katrina relief; $650 million for SCHIP (which includes Medicaid savings); and an increase in the federal minimum wage (and corresponding tax breaks). A provision to prevent the preemption of state chemical security laws was stripped out of the bill during conference.

FY 2008 House Interior and Environment Appropriations Subcommittee Markup
On May 23, the U.S. House Appropriations Subcommittee on the Interior and Environment adopted the Department of the Interior and Environment Appropriations Act for FY 2008, which is scheduled for consideration by the full committee later this week. The bill provides $27.6 billion for the Department of the Interior, EPA and related agencies, including:

$1.125 billion for the Clean Water State Revolving Funds, $42 million above FY 2007 levels;
$1.272 billion for Superfund, $21 million above FY 2007 levels;
$233 million for Payment in Lieu of Taxes, equal to FY 2007 fund levels; and
$268 for various land acquisition programs, $70 million above FY 2007 levels.

FY 2008 House Homeland Security Appropriations Subcommittee Markup
On May 18, the U.S. House Appropriations Subcommittee on Homeland Security adopted the Department of Homeland Security Appropriations Act for FY 2008, which will be considered by the full committee on June 5. The bill provides $36.254 billion in discretionary funds, including:

$550 million for the State Homeland Security Grant Program, $25 million above FY 2007 levels;
$400 million for the Law Enforcement Terrorism Prevention Program, $25 million above FY 2007 levels;
$800 million for the Urban Area Security Initiative, $30 million above FY 2007 levels;
$50 for the Metropolitan Medical Response System, $17 million above FY 2007 levels;
$300 for the Emergency Management Performance Grants, $100 million above FY 2007 levels;
$400 for Port Security Grants, $190 million above FY 2007 levels;
$400 for the Transit Security Grants, $225 million above FY 2007 levels; and
$50 million for Interoperability Communications Grants.

In addition, the bill only provides $50 million for state implementation of the Real ID, $950 million below the estimated startup costs as determined by NCSL, governors and motor vehicle administrators in a study released last year — The Real ID: National Impact Analysis.

Sales Tax Fairness and Simplification Act
On May 23, Senator Mike Enzi of Wyoming introduced the Sales Tax Fairness and Simplification Act (S. 34). The Sales Tax Fairness and Simplification Act is a culmination of work, through the leadership of Senator Enzi, NCSL, NGA and other stakeholders, which would give those states that have complied with the Streamlined Sales and Use Tax Agreement the authority to require out-of-state sellers to collect their sales and use taxes.

To date, twenty-one states have simplified their sales tax law and over 1,000 volunteer sellers are collecting sales tax on remote sales. This voluntary effort has resulted in over $75 million in new revenues for state and local governments which previously would have gone uncollected. In addition, the state of Washington recently enacted legislation to comply with the Streamlined Sales and Use Tax Agreement. For more information visit: http://www.ncsl.org/programs/fiscal/tctelcom.htm

NCSL Annual Meeting: August 5-9, 2007
This summer, thousands of state legislators and legislative staff will come to Boston—the cradle of the American Revolution—to revolutionize ideas for America’s future.

For more information: http://www.ncsl.org/annualmeeting/