Capitol to Capitol
An Information Service of NCSL's Standing Committees

Volume 17, Issue 28, September 17, 2010


Several welfare programs will expire on September 30 unless Congress takes action to either extend or reauthorize these vital programs. This includes the Temporary Assistance to Needy Families (TANF) block grant, which is in the federal budget baseline and thus will not require new spending offsets. TANF supplemental grants, on the other hand, are not in the budgetary baseline and may face more difficulties. Seventeen states with historically low levels of welfare spending and/or high population growth receive supplemental grants in addition to the amount they receive through the TANF block grant. These states are Alabama, Alaska, Arizona, Arkansas, Colorado, Florida, Georgia, Idaho, Louisiana, Mississippi, Montana, Nevada, New Mexico, North Carolina, Tennessee, Texas and Utah.

 In addition, the $5 billion TANF Emergency Contingency Fund (TANF ECF) authorized in ARRA expires at the end of September. States have depleted this fund, making it necessary for Congress to extend and provide additional funds.  NCSL recommends that state legislators contact their congressional delegates and urge them to reauthorize TANF, TANF supplemental grants and the TANF ECF. If the reauthorization is not passed in a tax extenders bill, the likely vehicle would be in a continuing resolution.  (NCSL Staff Contacts: Sheri Steisel, Lee Posey)


As Congress returns from its Labor Day recess, the debate over the expiring 2001 and 2003 tax cuts appear to be the central issue as states head into the mid-term elections. The tax provisions contain a bevy of substantial changes, including individual federal tax rates, estate taxes, capital gains taxes and the alternative minimum tax. The crux of the dispute revolves around whether to allow tax cuts for higher-income Americans—specifically those with an annual federal tax liability of $200,000 or joint filers with a tax liability of $250,000—to expire along with lower and middle-class tax cuts. If tax rates for those with higher incomes expire, individual income tax brackets would change from 33 percent and 35 percent to 36 percent and 39.6 percent, respectively. The Congressional Budget Office (CBO) and the Joint Committee on Taxation (JCT) recently “scored” the potential loss of revenue at $3.7 trillion over 10 years for the permanent extension and $3.0 trillion for all but the higher tax brackets, given the same time frame. NCSL will closely monitor developments due to the varied potential impacts on state revenues if Congress extends or fails to extend the tax cuts. (NCSL Staff Contacts: Michael Bird, Jeff Hurley)


With the 2011 fiscal year beginning in two weeks, lawmakers will need to adopt a continuing resolution to fund the federal government, since Congress has yet to finalize any spending bills. At the moment only two bills have passed either committee chamber, as the House approved the Military Construction-VA and Transportation-HUD spending bills. The Senate Appropriations Committee Thursday marked up the Defense and Legislative Branch measures, with the remaining bill, Interior-Environment, postponed until next week. Questions remain about whether a continuing resolution will be “clean” or include a litany of other budget requests, such as funding increases for Pell grants, “Race to the Top,” health care implementation, start-up costs for financial services legislation or the aforementioned one-year extension for the TANF Emergency Fund. (NCSL Staff Contacts: Michael Bird, Jeff Hurley)


On September 14, NCSL sent a letter to the House Subcommittee on Crime, Terrorism and Homeland Security in appreciation for its efforts in holding a hearing on domestic minor sex trafficking. The letter was signed by Georgia Senator Renee Unterman and Texas Representative Jerry Madden, immediate past chairs, respectively, of NCSL’s Committee on Human Services and Welfare and Committee on Law and Criminal Justice. It refers to the NCSL human trafficking policy resolution that was passed in July, which condemns the act of human trafficking and calls for state/federal partnerships and an increased dialogue between state and federal policymakers. Full text of the letter is available at (NCSL Staff Contacts: Sheri Steisel, Susan Frederick, Jennifer Arguinzoni)