Appropriations process for FY 2009 gets underway.

by NLC Federal Relations Staff

Before returning home for the July 4 recess, House and Senate committees began action on the FY 2009 spending bills. While Congress is in the early stages of the appropriations process--at will fund federal programs for FY 2009 and may not complete the process until after a new President is in office, funding recommendations emerging from Senate and House appropriations committees are generally favorable for federal programs important to cities and towns.

The process resumes when Congress returns to Washington this week.

Crime Prevention Programs

The President's FY 2009 budget calls for cutting more than $1 billion in funding for local crime prevention and law enforcement, including the elimination of the Community Oriented Policing Services (COPS) program and the consolidation of virtually all federal public safety and crime prevention grant programs. Sending a clear message to the White House, Senate and House appropriators so far are rejecting the President's proposal and are supporting funding increases for many of the public safety and crime prevention programs important to local governments, including those the White House slated for consolidation or elimination.

Proposals approved by the House and Senate appropriations committees call for $1.3 billion and $1.4 billion, respectively, for State and Local Law Enforcement Assistance Grants, which is an increase over the $1 billion set aside for the program this year. This assistance includes a strong recommitment to the Justice Department's Byrne Justice Assistance Grants (Byrne JAG) program, a flexible source of funding for local prevention, intervention and enforcement efforts. In FY 2008, that program was funded at $170 million; the House committee approved $550 million for the program for FY 2009, and the Senate committee approved $580 million.

The COPS program also received a boost with House appropriators increasing funding by $40 million over FY 2008 to $627 million, and Senate appropriators increasing the level to $600 million.

One of this year's funding casualties may be the popular Weed and Seed program, which integrates crime prevention, law enforcement and community revitalization efforts. The program received $32 million in FY 2008 but would receive only $32 million under the House version of the proposal and $25 million under the Senate's. The President's budget, however, called for the total elimination of the program.

There is agreement between the President and Congress to fund re-entry services for ex-offenders. The House and Senate spending bills provide funding for programs created in the Second Chance Act of 2007, P.L. 110-199, a priority for the Administration that was signed into law in April. The House and Senate appropriators are recommending $45 million and $20 million, respectively.

Housing and Community Revitalization Programs

The House Appropriations Subcommittee on Transportation, Housing and Urban Development unanimously passed a first draft of the spending bill that could fund key municipal housing and transportation programs in FY 2009. The $108.3 billion appropriations bill, which has yet to be formally filed and given a number, would allocate $66.7 billion for transportation programs and $41.5 billion for housing programs.

During consideration of the bill, Subcommittee Chairman John Olver (D-Mass.) noted that the subcommittee's housing priorities were shifting because of skyrocketing defaults on home mortgages and the inability of the housing market to absorb homes made vacant by foreclosure.

"As the foreclosure crisis explodes across the country, it has become painfully clear that the often overlooked importance of affordable rental housing must once again become an integral part of the nation's housing policies," Olver said.

To that end, the subcommittee draft of the bill rejects the President's proposed $263 million increase for the HOME Investment Partnership Program, which primarily funds homeownership opportunities for low-income families. Instead, the bill decreases HOME funding $50 million below this year's level to $1.65 billion. Savings from the reduction would go to restore funding for other programs, principally the Community Development Block Grant program, which would gain $1 billion more than the President's request, for a total of $4 billion, $134 million above this year's level.

The savings also would be used to increase funding for the Section 8 Tenant-Based Rental Assistance program by $145 million to $16.57 billion, an amount the subcommittee says is sufficient to maintain all current federal housing vouchers. In addition, the bill would significantly boost funding for the Section 8 Project-Based Rental Assistance program by $918 million to $7.3 billion.

Olver expressed concern about the current state of the program, saying, "I fear that a lack of confidence in the program will cause a number of owners to pull out, which would lead to a significant reduction in affordable housing units."

The bill would also maintain nominal funding to save two programs President Bush has sought to eliminate for years: the HUD Brownfields Redevelopment program and the HOPE VI program. The Brownfields program would be level funded at $10 million, and funding for HOPE VI would be increased by $20 million to $120 million.

Finally, the bill would increase funding for Homeless Assistance Grants by $105 million over last year's levels to $1.69 billion and would provide a total of $75 million in foreclosure counseling and assistance that the subcommittee estimates could benefit more than 200,000 families at risk of losing their homes.

Transportation Programs

For transportation programs, the House Appropriations Subcommittee on Transportation, Housing and Urban Development refused to take action on the impending shortfall due to declining federal fuel tax revenues in the Highway Trust Fund, noting that "the shortfall is not of this committee's making, nor is it this committee's responsibility to make up the difference." The subcommittee set highway spending at $40.2 billion and transit programs at $10.3 billion, as required by the Safe, Accountable, Flexible, Efficient Transportation Equity Act: A Legacy for Users transportation authorization law.

For federal airport programs, the subcommittee supported increased funding for the Airport Improvement Program (ALP) to $3.5 billion, an increase of $765 million above the President's budget request and at this year's levels. The AIP funds grant programs for municipally run airports across the nation. The bill draft also restores funding for the Essential Air Services program, which provides funding for smaller communities that would otherwise not have commercial airline service.

The draft bill also provides $1.44 billion for Amtrak including $60 million for a new capital grants program for states for intercity passenger rail.

Energy Programs

The House Appropriations Committee has approved funding for energy programs, including an initial commitment of $295 million to support the startup of the Energy Efficiency and Conservation Block Grant program. NLC continues to work toward securing full funding of $2 billion for this important program for cities and towns.

The committee also recommended a significant increase in funds for the Energy Efficiency and Renewable Energy programs, providing $2.5 billion, an increase of $760 million over fiscal year 2008 and $1.2 billion over the President's budget request.

Additionally, the committee rejected the proposed elimination of the Weatherization Assistance Program that local governments use to help families insulate their homes and lower their heating or cooling costs. The bill would provide $250 million for weatherization grants, $23 million above FY 2008.

Environmental Programs

The House Appropriations Subcommittee on Interior, Environment and Related Agencies approved nearly-level funding for programs important to cities and towns in its spending bill. However, the Clean Water State Revolving Fund would receive a proposed increase of $150 million over FY 2008, which rejected the President's proposal to cut the program and provided funding at $850 million. States and local governments access low-interest loans for sewage treatment and pollution control from this fund.

The Drinking Water State Revolving Loan Fund, which is also essential to cities and towns to meet the requirements of the Clean Water Act, would receive level funding at $842.2 million.

The subcommittee rejected the President's cuts to the Superfund and Brownfields grant programs, providing $1.3 billion and $100 million for the programs respectively.

Homeland Security Programs

In the area of homeland security, the Senate Appropriations Committee approved level funding of $890 million for the State Homeland Security Grant Program (SHSGP), while House appropriators are recommending an increase in funding to $950 million. The President's budget proposed to reduce funding for this program to $200 million. By law, 80 percent of SHSGP funding goes directly to local jurisdictions.

In contrast to SHSGP, the House and Senate Appropriations Committees and the President's budget support continuing funding dedicated to large urban areas through the Urban Area Security Initiative (UASI) program. The President's budget and the Senate committee call for $825 million, while the House committee appropriated $850 million. In FY 2008, UASI received $820 million.

In total, the House and Senate Appropriations Committees each recommended an increase of approximately $500 million in state and local homeland security grant programs for FY 2009, while the President requested a $500 million decrease in his budget.

Labor, Health and Human Services, and Education Programs

The Senate Appropriations Committee and the House Appropriations Subcommittee on Labor, Health, Human Services and Education have each adopted spending bills to serve as the blueprint for finding work force, health, human services and education programs in FY 2009. The $155 billion appropriations bill, which has yet to be formally filed in the Senate and requires full committee approval in the House, would provide some funding increases in many of the programs that are important to cities.

Speaking of the Senate's bill, Committee Chairman Robert Byrd (D-W.Va.) said, "This legislation is an aggressive effort to place real dollars in programs that are vital to strengthening the foundation of this country."

House Committee Chairman Dave Obey (D-Wisc.) said, "The [House] bill presented today represents our best efforts to invest judiciously in those activities that will help prepare the country to meet the challenges ahead."

While the Senate was able to move forward and adopt a bill at committee level for full Senate consideration, the House was unable to do so. Because of procedural maneuvers by the minority, Obey decided to end debate on the labor appropriations bill rather than allow an energy bill to come up for consideration that would have forced a vote on offshore drilling.

Across the board, the Senate and House appear poised to invest substantially more than the President in a wide range of human services, education and work force programs. For example, while the President recommended $14.3 billion (a $400 million increase over FY 2007) be appropriated for Title I of No Child Left Behind, the Senate Appropriations Committee recommended $14.5 billion (a $600 million increase) and the House Appropriations Subcommittee recommended $15.1 billion (a $1.2 billion increase). Funding for education for individuals with disabilities was also increased by the Senate committee and House subcommittee, with each recommending $11.5 billion (a $500 million increase) as compared with the President's request of $11.3 billion (a $300 million increase).

The House and Senate Committees supported appropriations of about $2.6 billion (a $30 million increase) for the Low Income Home Energy Assistance Program, while the President has requested $2.0 billion (a $570 million decrease).

The President has sought to eliminate funding for the Community Services Block Grant program while the House and Senate each are considering about $646 million, an increase over last year of $46 million. Funding for community health centers would also be increased by the House and Senate if preliminary recommendations stand by about $180 million to $2.2 billion, while the President would increase the program by $110 million to $2.05.

Workforce Investment Act programs would be reduced, if the President's recommendations stand, by $240 million to $3.06 billion, while the Senate and House would level fund the program at $3.3 billion.