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Federal Budget Update
Federal Budget Deadlines Loom
House Speaker Mike Johnson and Senate Majority Leader Chuck Schumer announced an agreement on topline funding numbers over the weekend, setting defense spending at $886 billion and non-defense spending at $773 billion. The agreement does not include what will be a supplemental request for aid to Ukraine, Israel and Taiwan that the GOP has tied to border reforms. The outstanding disagreements on these issues may impact passage of overall appropriations as both sides seek leverage for their political priorities. As efforts continue, the risk of partial and full government shutdowns increases as deadlines near.
While Johnson and Schumer seek support for passage, the White House Office of Management and Budget is preparing for a possible federal government shutdown by providing contingency plans updated in 2023 for all departments and agencies that provide principles of operation during a lapse of appropriations.
The Fiscal Responsibility Act enacted in 2023 adds another layer to department and agency planning. The White House released a memo on Dec. 22 to all heads of executive departments and agencies regarding discretionary spending limits for fiscal years 2024 and 2025 for two scenarios: 1) passage of full-year appropriations bills and 2) interim discretionary spending limits enforced after April 30 if Congress fails to enact full-year appropriations. The memo provides direction to federal executives and includes FAQ regarding how departments and agencies should address potentially impacted discretionary funding.
Further Reading:
USDA Releases Interim Final Rule on New Summer Child Nutrition Programs
The Department of Agriculture’s interim final rule codifies the structure and administration of the new Summer EBT program and the non-congregate meal option for rural areas. The regulation incorporates previously released guidance and stakeholder feedback on both programs, requires state-coordinated service plans for summer meals by 2025, and requires more frequent reporting of state meal site data. The rule went into effect on Dec. 29. Read more.
Proposed Lead and Copper Rule Released
The Environmental Protection Agency released a proposed rule, updating the 30-year-old Lead and Copper Rule, to improve protections against lead contamination in drinking water. If enacted, the rule would lead to significant actions and changes, including the mandatory removal of all public lead pipelines within the next decade. Utilities would be required to develop an inventory of legacy lead pipelines and remove and replace 10% of these pipelines annually. The administration is looking to offset the cost of this effort, estimated to be between $20 billion and $30 billion, using funds in the Bipartisan Infrastructure Law and the Drinking Water State Revolving Fund. The proposed rule would also require revisions to tap-sampling protocol to ensure best practice, more stringent contamination levels triggering action and public notification, and requirements for the installation of certified lead reduction filters in systems that violate actionable levels. The EPA will host a public hearing on the proposed rule on Jan. 16 and plans to finalize the rule in October 2024. Read more.
New FAFSA Form Available During Limited Hours
The newly overhauled Free Application for Federal Student Aid (FAFSA) form went live as part of a “soft launch” on Dec. 30 for the 2024-25 award year. During the soft launch, the form has been available for only limited times, and periodic “maintenance pauses” have slowed students’ ability to complete the form.
The new FAFSA is simplified compared with past iterations and expands qualifying eligibility for the Pell Grant. According to federal estimates, nearly 600,000 new students will qualify for at least a minimum Pell award, and 1.5 million more students will receive a maximum award.
The Federal Student Aid office has warned that processing delays on the already-delayed FAFSA will persist for months in 2024. The office has said that colleges and state grant offices will not receive applicants’ information until late January at the earliest. Read more.