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    Entries in Congress (16)

    Tuesday
    Apr252017

    Amid Shutdown Talk, States and Cities Seek Clues to the Future

    Whether and how Congress passes a budget this week could indicate what's to come when negotiations start for the next year, which will be the first full budget under President Trump.
    BY  APRIL 25, 2017

     

    As lawmakers in Washington work to avoid a shutdown of the federal government this week, the tenor of the negotiations could provide a window for states and localities into what to expect from future budget debates on Capitol Hill.

    “The big picture is how well the Republican conference gets along in terms of this run-of-the-mill budget stuff,” says Dan White, a director at Moody’s Analytics. “If they take it down to the wire, that portends some very uncertain fiscal times over the next couple months.”

    The federal government has been running on a continuing resolution that funds agencies at 2016 levels. Congress has until midnight on April 28 -- this Friday night -- to agree on a spending plan for the remainder of the federal fiscal year, which ends Sept. 30, or approve another short-term resolution.

    In the aftermath of the Republican party’s failure to repeal the Affordable Care Act (ACA), observers are eyeing the amount of drama it takes for Congressional leaders to agree on the budget. A political squabble now over closing out fiscal year 2017 wouldn't bode well for hopes of getting through a new fiscal 2018 budget, which must be approved by Oct. 1.

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    Wednesday
    Apr192017

    As the Clock Ticks, Senate Stalls on State-Run Retirement Plans

    Congress could overturn a rule that allows states to create private-sector retirement programs. But it only has a limited time to do it.
    BY  APRIL 19, 2017

    The U.S. Capitol (FlickrCC/Geoff Livingston)

    Late last month, Congress voted to overturn an Obama-era rule that cleared the way for cities to create retirement programs for private-sector workers that didn't have one through their employer. But a similar resolution targeting the rule as it applies to states is stuck.

    For the past three weeks, that resolution has lingered in uncertainty as the Senate stalls on taking an up or down vote. Many believe that signals an opportunity. "Based on the conversations we've had with staff and colleagues working on this," says Cristina Martin Firvida of AARP, which supports the Obama-era regulation, "I think there are a number of senators who still have a lot of questions about the state rule."

    The rule, which was issued by the Department of Labor, reaffirmed cities' and states' legal right to help support private-sector savings programs for small businesses. Seven states are implementing such programs, while another dozen states and cities are considering them.

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    Friday
    Apr072017

    This Infrastructure Program Ended Up Costing Governments Millions. Trump Might Bring It Back.

    States and localities are wary of the president's support for the Build America Bonds program.
    BY  APRIL 6, 2017

    A popular Obama-era infrastructure financing program may get revived this year as President Trump moves forward on his pledge to invest $1 trillion in infrastructure. But this time around, state and local governments might not be as excited about it.

    The program, Build America Bonds (BABs), was created in 2009 as one of many recession-era initiatives aimed at jump-starting the economy. Unlike tax-exempt municipal bonds, BABs are taxable, and, as a result, open up the municipal market to new investors, such as pension funds or those living abroad. But BABs are also more expensive for governments. So to defray the added cost, the federal government offered a direct subsidy of 35 percent of state and local governments' interest payments on BABs.

    But the program became a casualty of sequestration: cutbacks in federal subsidies promised under the program left state and local governments scrambling to fill the void. A recent estimate by the Institute of Government and Public Affairs at the University of Illinois found that so far Illinois and its localities have had to pay out a collective $70 million to offset the higher costs of BABs.

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    Friday
    Mar172017

    The Week in Public Finance: Trump's Budget, the CBO on Health Care and Accounting for Higher Ed

    BY  MARCH 17, 2017

    Trump’s Budget Cuts

    This week, President Trump proposed his budget and, as expected, it focused federal spending cuts on a narrow area that impacts state and local governments the most: discretionary spending. The cuts come by way of diverting more than $54 billion from various federal agencies to defense spending.

    The Takeaway: Paying for all these cuts would mean many programs beneficial to states and localities would be targeted. Under the plan, grant funding -- which accounts for 31 percent of state budgets and 22 percent of state and local spending combined -- takes an enormous hit. Specifically, Trump would eliminate the $3 billion Community Development Block Grant program, which was started by President Nixon as a way to provide direct federal assistance to city projects.

    In transit, the president calls for a half-billion cut from the wildly popular TIGER grant program. He would also cut $175 million in subsidies for commercial flights to rural airports, eliminate funding for many new transit projects and discontinue support for long-distance Amtrak trains.

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    Friday
    Mar102017

    The Week in Public Finance: Paying for Repeal and Replace, SEC's New Disclosure Rule and the Online Sales Tax Fight

    BY  MARCH 10, 2017

     

    The Cost of 'RepubliCare'

    Congressional Republicans this week revealed their replacement plan for the Affordable Care Act. Fiscally, the plan does what the GOP promised: If passed, it is expected to make health-care spending less expensive for the federal government (pending the assessment from the Congressional Budget Office.) States, on the other hand, will have some tough decisions to make regarding Medicaid.

    Under the proposed plan, Medicaid allotments would be capped based on the program's per-capita enrollment in that state. Currently, Medicaid has an open-ended funding structure based on matching whatever a state spends.

    While the plan doesn't repeal the Medicaid expansion, it starts to ramp down that population beginning in 2020 by discontinuing the federal subsidy for any new expansion enrollee. It also works to pare down the population by disqualifying any participant who lets their enrollment lapse and requiring states to redetermine enrollee eligibility every six months.

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