Federal Update June 2023

President Joe Biden on Saturday signed a bill that suspends the U.S. government's $31.4 trillion debt ceiling, averting what would have been a first-ever default with just 48 hours to spare.

The House of Representatives and the Senate passed the legislation late last week after Biden and House of Representatives Speaker Kevin McCarthy reached an agreement following tense negotiations. The Treasury Department had warned it would be unable to pay all its bills on Monday if Congress had failed to act by then.

Highlights that may be of interest are below:

Debt Ceiling

• Debt ceiling would be raised through December 2024 – importance of this timeline is that it extends beyond the 2024 election. As we know from previous debt limit debates, Treasury can use ‘extraordinary measures’ for a period of time

Spending Caps

• Federal spending/appropriations would be ‘capped’ for the next two fiscal years, FY 2024 and FY2025. FY 2024 non-defense discretionary (topline for programs like WIOA, education, child care, etc) would essentially be held at current FY 2023 levels. FY 2025 would receive an overall 1% increase from FY2024 (~$7 billion increase, year to year)

Unobligated COVID Funds Rescission

• Rescinds about $30 billion in unobligated coronavirus relief money that Congress approved through previous bills
• Most of this appears to be FEDERAL funds, not funds that have been sent to state/local governments
• However, it does take money back from small business loans, housing assistance, and rural broadband efforts

TANF

• The legislation also updates the Caseload Reduction Credit for TANF – will make it more difficult for states to avoid the work requirement (effective October 1, 2025)
• Creates a Pilot Program (effective October 1, 2024) for up to 5 states to negotiate work outcomes – 6 year pilots (1 year to benchmark data, reporting for 5 years)

SNAP

• Increases the maximum age for work requirement from 49 to 50 in FY2023, 52 in FY24, and 54 and FY25 – these provisions sunset in September 2030 and the maximum age goes back to 49

Note: NYATEP members received an extended outline of these important details via email immediately after the announcement. Don't miss out on future updates --- become a member!  Contact with Gina Onyiuke at [email protected] to learn more!