CLASP Q&A on Budget Deal

Dec 13, 2013

By Tom Salyers and Hannah Matthews

As pundits dissect the proposed budget deal hammered out by the committee co-chaired by Representative Paul Ryan (R-WI) and Senator Patty Murray (D-WA), CLASP is examining the proposal with a focus on how it affects low-income children, families and individuals.

The following sums up how the budget deal impacts funding for child care and early education.  Read the entire Q&A here >>

Q.           What are the implications of this budget deal for low-income children, families, and individuals?

A.         On balance, the Bipartisan Budget Act of 2013 accomplishes several important things for low-income people but also has a very large gap.  One big plus is that it restores most, though not all, of the reductions imposed by the "sequester" over the next two years on discretionary programs such as child care subsidies, Head Start, job training, education, and child nutrition.  The deal will allow for total domestic discretionary spending above FY 2013 levels, although still below FY 2012. A second plus is that with spending levels set for two years, we can return to a more typical budget and appropriations process, reducing the likelihood of further government shutdowns and enabling programs and state and local governments to plan ahead.  And a third is that unlike some proposed plans, the deal leaves intact the key mandatory programs - such as Medicaid and Social Security - that are so important to low-income families.

The biggest minus of this budget deal for low-income people is that it doesn't include an extension of unemployment benefits for the long-term unemployed. 

So we believe that on balance, Congress should approve this deal - and should also act promptly to extend federal unemployment insurance for the long-term unemployed.

Q.        Do we now know what funding levels individual programs will have in FY 2014?

A.         No.  But this agreement is enough to restore most, but not all, of the cuts imposed by the sequester.  It also brings a level of stability to the government's fiscal situation for both FY 2014 and FY 2015, preventing a continuation of the crises that have surrounded the budget negotiations over the last few years.   For 2014, the proposal would set the overall discretionary spending level for the current fiscal year at $1.012 trillion, which is midway between the Senate's proposal of $1.058 trillion and the House's of $967 billion. The agreement paves the way for an omnibus appropriations bill in the next few weeks, before the continuing resolution expires on January 15, 2014.  For FY 2015, it sets spending levels at $1.014 trillion and makes it more likely that Congress will complete its appropriations work before the start of the fiscal year.

Q.        What is included in the deal related to the President's early learning initiative and the proposed Strong Start for America's Children Act?  What about funding levels for current child care and early education programs such as child care subsidies and Head Start?

A.         As noted above, the proposal doesn't specify funding for any individual programs, including child care and early education programs.  Most importantly, the deal prevents more sequester-related cuts for Head Start and child care in the next two years. Related to the Strong Start proposal, the deal includes specific provisions - called reserve funds - that send a message that child care, pre-kindergarten and home visiting are important priorities. Reserve funds do not, however, provide actual funding, which means Congress needs to find a way to pay for any new legislation. The President has proposed using a tobacco tax to provide mandatory funding for his proposal.  The crucial next step towards supporting child care and early education programs is the overall spending level for the Labor, Health and Human Services and Education Appropriations Subcommittee, likely to be set very soon.

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