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For background information, comprehensive analyses of budget proposals and their impact on public programs, and ideas for getting involved, we recommend the following resources.*
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CLASP Federal Budget Resources July 12, 2006 Fiscal Year 2007 The President's proposal for the fiscal year 2007 federal budget was released on February 6, 2007. On March 16, the Senate passed its version of the 2007 federal budget, which included an amendment from Senators Specter (R-PA) and Harkin (D-IA) that added $7 billion in discretionary funding for education, health, and labor programs. The House has so far failed to pass its bill, which contains cuts to many social programs, and falls roughly $10 billion short of maintain-ing current levels of discretionary spending. The Coalition on Human Needs offers a detailed of President Bush's 2007 federal budget proposal. CLASP actively tracks and analyzes developments in the areas of our focus—with the goal of promoting a federal budget that does not disproportionately disadvantage programs for vulnerable families or reduce services and supports that are effective in moving families toward self-sufficiency. Here are some of our analyses of the 2007 proposals. Fiscal Year 2006 On February 1, the U.S. House of Representatives passed the fiscal year 2006 federal budget—the "Deficit Reduction Act of 2005—with $38.8 billion in spending reductions, including cuts to programs that assist low-income children, parents, and individuals (see Title VII). The bill also reauthorized the federal Temporary Assistance for Needy Families (TANF) program, with a mandate that states meet new work participation requirements. Below are some resources from CLASP and other organizations that examine the most troubling provisions. Temporary Assistance for Needy Families (TANF) and Child Care. The bill imposes rigid and restrictive TANF work requirements while providing only $200 million in new child care funding, a small fraction of the amount needed to keep pace with inflation, and will force states to further cut child care for low-income working families.
Child Support. The budget bill cuts federal funding for child support enforcement by $1.6 billion over five years and $4.9 billion over ten years—which will result in $8.4 billion in child support payments that would otherwise be collected will go uncollected in the next decade.
Child Welfare. The budget decreases federally funded foster care services by $343 million over five years and $845 million over ten years—chiefly by removing federal financial support for many grandparents and other relatives caring for children. It also sets time limits on federal financial support for children in safe but unlicensed relative placements. The Agreement authorizes the appropriation of $345 million for the Promoting Safe and Stable Families program for 2006, which funds services to families in crisis and foster youth awaiting adoption, and others. The Agreement also appropriates $20 million for grants to improve courts’ handling of child welfare cases.
Medicaid. The bill includes increases in Medicaid co-payments and premiums, and reductions in Medicaid benefits total $16 billion over the next ten years, according to the Congressional Budget Office. It also contains a little-noticed provision that would require all citizens applying or reapplying for Medicaid to produce a passport or birth certificate to prove they are U.S. citizens.
Student Loans. Congress cut $12.7 billion from the student loan program, most of which comes directly from students. The 2006 budget bill allows student loan interest rates to effectively increase to a fixed 6.8 percent on July 1, 2006 (currently it is variable with an 8.25 percent cap; students currently pay 5.3 percent), and increases the interest rate on parent loans. Although these changes primarily affect middle and upper-income students, the fact that the maximum Pell grant remains frozen at $4,050 for the fourth year means that even lower income students may need to rely on loans to fill the gaps. Nearly one-third of the savings are generated by capturing excess subsidies that students pay to lenders. In contrast with other bills earlier this year, the savings from these cuts would not be redirected to expanding higher education assistance for low-income students.
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www.clasp.org • Center for Law and Social Policy • (202) 906-8000 1015 15 th Street, NW, Suite 400, Washington, DC 20005 |
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