Omnibus Spending Bill Averts Government Shutdown but Cuts Important Programs

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December 16, 2011; Source: Washington Post | Did the nonprofit sector simply miss a really big issue—that the last-minute congressional deal to avoid a government shutdown contained social policy changes of importance to the nonprofit sector? Were nonprofits so focused on the charitable deduction—which hasn’t been in play—that the sector missed some of the important elements of the federal spending bill? Was it that the debate over the payroll tax extension, because of its potential impact on jobs, took precedence? Or has the notion of a government shutdown become so commonplace that most of us aren’t really paying attention to the specifics in the congressional negotiations?

Clues to the social policy changes embedded in the federal spending deal are slowly emerging, and some of them ought to be causes for concern:

·         Did Congress really cut the Weatherization Assistance Program (WAP) by 60 percent, the lowest funding level since 1977? Did it also reduce the Low-Income Home Energy Assistance Program (LIHEAP) from $4.7 billion in FY2011 to $3.5 billion in FY2012? This looks like simplistic thinking by congressional negotiators: for example that because WAP received a big boost in the American Recovery and Reinvestment Act (the stimulus bill), it doesn’t need a regular annual appropriation. Maybe Congress forgot that the Recovery Act is already long gone, and the need for weatherization assistance remains. Maybe Congress thought that the nation’s inaction on global warming would result in warmer winters, reducing the need for energy assistance. This has to be one of the worst sleeper cuts in the spending bill.

·         The citizens of Washington, DC got whacked in this spending bill, just like they did with the last deal to avoid a government shutdown last April. The “DC rider” that prohibited federal funding for abortions for low-income people was extended; the District can’t use federal money for medical marijuana or its needle-exchange program; Republicans in Congress had toyed with provisions to end gay marriage or overturn DC’s strict handgun laws, but in the end didn’t add those non-spending riders.

·         Here’s a statement about Congressional priorities.The spending deal raised the Pentagon’s budget by 1 percent, but cut the budget of the Environmental Protection Agency by 6 percent. If that isn’t a giveaway as to the intent of Congress to undo the deficit agreement and reverse the pending cuts in the postwar defense budget, then what is it? Of course it might be a reflection of the incessant television ads (by 501(c)(4)s, in addition to Republican presidential candidates) attacking so-called “job-killing EPA regulations,” such as strengthening the MACT regulations on coal-fired power plants.

·         The spending bill will knock 100,000 students out of one or another aspect of the Pell Grant program. According to the New America Foundation, the bill includes a potpourri of Pell Grant changes: “[T]he student loan provision, which would charge borrowers with subsidized Stafford loan interest during the six-month repayment grace period, would save $400 million that could be spent on Pell Grants in fiscal year 2012. Pell Grant eligibility changes in the final bill reduce the income allowable to qualify an applicant for a maximum grant under the ‘automatic zero’ expected family contribution calculation; require Pell Grant recipients to have a high school diploma, a GED, or have been homeschooled; reduce the number of years a student can use Pell Grants from nine to six years; and require that a student be eligible for 10 percent of the maximum grant instead of 5 percent to receive the minimum grant.”As to the reduction of the number of years a student can use Pell grants, according to CNN Money, “African-American students comprise 24% of Pell Grant recipients but make up 41% of Pell Grant recipients working toward a degree after six years, according to the Institute for College Access & Success.” That is a very clear example of a racially disparate impact from a policy decision without specific racial intent.

With an omnibus spending bill in play, nonprofits have to be attentive to what might be slipped in by members of Congress as another government shutdown draws nigh. Can NPQ Newswire readers identify other unpalatable pieces of the spending bill?—Rick Cohen

  • Robert Joy

    Also gutted state commissions funding for national service. AmeriCorps and volunteer advocacy, programs support and development are weakened and/or eliminated. These were the locally based offices providing direct services and oversight with some independence.

  • Laura Moreno-Hill

    This is great insight about how this Omnibus bill will make a negative impact across the board.

    Another significant impact will be to lead poisoning prevention programs and mean eliminating hundreds of jobs, putting almost half a million kids at risk, and overloading the caseloads at state and local health departments.

    There are still over 30 million homes with lead-based paint in this country. Not to mention the countless other areas(i.e., special education, juvenile detention, Medicaid, etc.) this will affect.

    For more info specifically about this, check out NCHH