Budget and Revenue Standing Committee

Federal Budget and Revenue Update

January 2, 2008
Volume 14, Number 1

An Information Service of the NCSL Budgets and Revenue Committee

The 1st Session of the 110th Congress Ends
On December 26, 2007, the President signed H.R. 3996, which includes an unfunded, one-year fix for the Alternative Minimum Tax (AMT) to ensure no additional taxpayers are required to pay the federal minimum tax. According to the Congressional Budget Office, the AMT patch will cost the federal treasury $50 billion in FY 2008.

On December 26, 2007, the President also signed into law the Department of State, Foreign Operations and Related Programs Appropriations Act for FY 2008 (H.R. 2764). H.R. 2764 contains funds for the 11 appropriations measures that had not been enacted (all except for Defense). The $554 billion measure includes: $70 billion in emergency funds for Iraq; increases for homeland security grant, the Low Income Home Energy Assistance Program (LIHEAP), highway and mass transit programs, No Child Left Behind, and the Women, Infants and Children (WIC) supplemental nutrition program; and cuts to State and Local Law Enforcement Assistance and the Clean Water State Revolving Fund. Other highlights include:

FY 2008 Department of Agriculture Appropriations Act
The legislation includes $19.1 billion, including $1.0 billion in emergency funds, for the Department of Agriculture, including:

0.7 percent across-the-board rescission of FY 2008 Budget Authority;
$13.9 billion for the Food Stamp Program, $415 million above FY 2007 levels; and
$6.020 billion for the Special Supplemental Nutrition Program for Women, Infants, and Children (WIC) program, including $400 million in emergency funds, and $815 million above FY 2007 levels.

FY 2008 Commerce, Science and Justice Appropriations Act
The legislation includes $52 billion for the Science, State, Justice, Commerce, and Related Agencies Appropriations Act for 2007, including:

$1.236 billion for State and Local Law Enforcement Assistance, $328 million below FY 2007 levels , including:
- $410 million for the State Alien Criminal Assistance Program; $9 million above FY 2007 levels;
- $170 million for the Edward Byrne Memorial Justice Assistance Grant Program; $350 million below FY 2007 levels;
- $188 million for Byrne Discretionary Grants, $78 million above FY 2007 levels; and
$587 million for the Community Oriented Policing Services Program, $46 million above FY 2007 levels.

FY 2008 Department of Homeland Security
The legislation includes $37.55 billion, including $2.7 billion in emergency funds, for the Department of Homeland Security:

$950 million for the State Homeland Security Grant Program, $425 million above FY 2007 levels;
$820 million for the Urban Area Security Initiative, $50 million above FY 2007 levels;
$0 for the Law Enforcement Terrorism Prevention Program, $375 million below FY 2007 levels;
$41 million for the Metropolitan Medical Response System, $8.0 million above FY 2007 levels;
$400 million for Port Security, $190 million above FY 2007 levels;
$400 million Public Transportation Security Assistance, $225 million above FY 2007 levels;
$50 million for the Interoperability Emergency Communications Grant Program, $50 million above FY 2007 levels;
$300 million for Emergency Management Performance Grants, $100 million above FY 2007 levels;
$50 million to assist states with the implementation of the Real ID, $50 million above FY 2007 levels; and
language to preserve state enforcement of chemical security laws and regulations that are more stringent that those implemented by the federal government.

FY 2008 Energy and Water Appropriations Act
The legislation includes $31.9 billion for the Department of the Energy and Water Development and Related Agencies Appropriations Act for FY 2008, including:

0.91 percent across-the-board cut on discretionary spending (and 1.6 percent cut on earmarks);
$229 million for Weatherization Grants, $14 million below FY 2007 levels; and
$44.5 million for State Energy Programs, equal to FY 2007 levels.

FY 2008 Interior and Environment Appropriations Act
The legislation includes $26.9 billion for the Department of the Interior and Environment Appropriations Act for FY 2008, including:

1.56 percent across-the-board cut in discretionary spending;
$2.926 billion for State and Tribal Assistance Grants, $287 million below FY 2007 levels, including:
- $689 million for the Clean Water State Revolving Fund, $687 million below FY 2007 levels;
- $829 million for the Drinking Water State Revolving Fund, $8 million below FY 2007 levels;
$1.253 billion for Superfund, $2 million below FY 2007 levels; and
$228 million for the Payment in Lieu of Taxes Program, $5 million below FY 2007 levels.

FY 2008 Labor, Health and Human Services and Education
The legislation includes $145 billion, including $300 million in emergency funds, for the Department of Labor, Health and Human Services and Education Appropriations Act for FY 2008, including a 1.56 percent across-the-board cut in discretionary spending.

Department of Labor

$864 million for Adult Job Training, $18 million above FY 2007 levels;
$941 million for Youth Job Training, slightly above FY 2007 levels; and
$1.190 billion for dislocated worker employment and training, $6.0 million below FY 2007 levels.

Department of Health and Human Services

$2.062 billion for the Child Care and Development Block Grant, equal to FY 2007 levels;
$2.570 billion for the Low Income Home Energy Assistance Program (LIHEAP), including $250 million in emergency funds, $409 million above FY 2007 levels;
$1.70 billion for the Social Service Block Grant, equal to FY 2007 levels; and
$630 million for the Community Services Block Grant, $24 million above FY 2007 levels.

Department of Education

$14.028 billion for Title I grants to local education agencies (No Child Left Behind), $1.190 billion above FY 2007 levels;
$10.783 billion for the Individuals with Disabilities Education Act (IDEA), $259 million above FY 2007 levels;
$2.960 billion for State Grants to Improve Teacher Quality, $73 million above FY 2007 levels; and
$272 million for Education Technology State Grants, $5 million below FY 2007 levels.

FY 2008 Transportation/ HUD Appropriations Act

$40.2 billion for Federal-aid Highways, $1.1 billion above FY 2007 levels;
$1.3 billion for Amtrak, $31 million above FY 2007 levels;
$3.6 billion for the Community Development Block Grants, $117 million below FY 2007 levels; and
a rescission of $3.150 billion in unobligated balances under the Highway Trust Fund.

NCSL Spring Forum
The NCSL Spring Forum is set for April 22- 26, 2008, in Washington, D.C. Legislators and legislative staff will converge on Washington to discuss issues important to state legislatures. More information to follow.