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AFI Human Services Committee
Federal Update
CONGRESS BEGINS RETREAT FROM BLOCK GRANTS
June 9, 1998
Over the past two weeks, Congress has taken a series of actions that represent a retreat from their commitment to block grants and that strike at the very heart of devolution. Cuts to the Temporary Assistance for Needy Families (TANF) block grant were proposed in the House Budget Resolution in addition to permanent reductions to the Title XX block grant (Social Services Block Grant) in the transportation reauthorization law (TEA-21; P.L. 105-178). Coupled with additional budget proposals to further cut spending in these areas and others, federal block grants to states have become open and vulnerable to reductions at the whim of the Congress. Details of the permanent as well as proposed cuts in federal human services spending are included in the summary below. For further information, contact Sheri Steisel or Kirsten Rasmussen at NCSL at (202) 624-5400.
TANF
Congressman Kasich's (OH) FY 1999 Budget Resolution (H. Con. Res. 284) passed the U.S. House of Representatives by a vote of 216-204 last Friday. The budget cuts $10 billion dollars from income security programs within the jurisdiction of the Ways and Means Committee (Function 600). Given the size of the reductions, it seems likely that the Committee would be forced to secure all or most of these savings from the Temporary Assistance for Needy Families (TANF) program. Alternatively, the Committee would have to cut child care, child support, unemployment compensation or other programs which would be politically unfeasible.
In addition to the proposed TANF cuts, the House Budget Resolution contains reductions in Title XX and Welfare-to-Work spending as well as reductions to state administrative reimbursements in the Food Stamp and Medicaid programs. The House and Senate Budget Resolutions have been referred to a conference committee to resolve differences between the bills. The Senate Budget Resolution does not currently contain cuts to TANF, but does include Title XX and administrative reductions similar to the House bill.
Title XX
$3.4 billion in cuts to the Social Services Block Grant (Title XX) were used as offsets in the Transportation bill (TEA-21) that was signed into law by the President yesterday. To pay for part of the extra cost of the transportation legislation, conferees cut Title XX funding from its current $2.38 billion level to $1.7 billion, with the cuts beginning in 2001. The highway bill left funding at the current $2.38 billion in FY99 and 2000. An added provision that also takes effect in 2001 is a new restriction on how much a state can transfer from the Temporary Assistance for Needy Families (TANF) block grant to Title XX. Under current law, states can transfer up to 10% of their TANF block grant to Title XX. The new language would limit this transfer to no more than 4.25%.
The President was the first to propose cutting Title XX in his Budget, though the Senate followed suit in their Budget Resolution, as did the House. Because TEA-21 did not make cuts to SSBG in FY99 or FY2000, it is understood on Capitol Hill that the Clinton Administration and Congress have agreed to cut SSBG in FY99 and FY2000 during appropriations for Labor/HHS/Education.
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