NASBO Fall Meeting Friday October 5 2012 Alexandria VA Federal Funds Information for States Where we Left Off in August Whats the Conventional Wisdom For appropriations a CR until the election BUT ID: 221748
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Slide1
Lame Ducks, Grand Bargains, Punts and Cliffs
NASBO Fall MeetingFriday, October 5, 2012Alexandria, VA
Federal Funds Information for StatesSlide2
Where we Left Off in August: What’s
the Conventional Wisdom?For appropriations, a CR until the election, BUT…For BCA, agreeing to postpone the day of reckoning, BUT…
For expiring tax provisions, a bruising fight, possibly informed by the election.For authorizations, probably nothing, BUT...Slide3
Six-Month Continuing Resolution
Through March 27, 2013FY
2012 + 0.612% for
most discretionary
programs (not
highways
)
Mandatory programs: current-law levelExtends SNAP, TANF, related programsAdditional funds for a few programs Slide4
The BCA and the Sequester
Absent a legislated alternative, a sequester will occur on January 2, 2013
Many mandatory and a few discretionary programs are exemptOMB report sheds light on its interpretations
OMB
estimates of
ATB
cuts: 8.2
% (nondefense discretionary), 7.6% (nondefense mandatory), 9.4% (defense discretionary)ATB reduction applied to FY 2013 funding in effect on January 2, 2013 (CR level)Slide5
Lame Duck Possibilities
Policy
Grand Bargain
Punt
Cliff
FY 2013 Appropriations
Unclear
Leave for new CongressN/ABCA SequesterReplace/modifyExtend deadlineImplement sequester
Expiring
tax provisions:
2% payroll tax
Probably extend
Extend
Expires
Bush-era rates
Maintain for <$250K
Extend
Expire
AMT
Permanent fix
Extend
Expire at their peril
Debt Limit
Raise
Small increase
No agreement
Expiring legislation:
Farm
bill (nutrition after March)
Reauthorize
or not
Extend
No agreement
TANF (after March)
Reauthorize or not
Extend
No action
Medicaid QI, TMA
Reauthorize or not
Extend
Expire?
UI EUC/EB
Reauthorize or not
Extend
ExpireSlide6
CBO Estimates the Fiscal CliffSlide7
Sequester Coverage Status of FFIS VIP Series ProgramsSlide8
Sequester Coverage Status of FFIS VIP Series FundingSlide9
Grand Bargain Revenue Options
Go after tax expenditures, including:Itemized deduction for S/L taxes
Make S/L bond interest taxableCurb or eliminate mortgage deductionCurb or eliminate tax exclusion for employer-provided health insurance
Changes in tax brackets, capital gains, AMT, etc.
Create
federal sales
tax or VATSlide10
The “Other” Federal Spending: Tax ExpendituresSlide11
Grand Bargain Spending Options
Modify Medicaid’s financing structure; other changes to mandatory programs
Statutorily limit health spending growthMore block grants (Medicaid and SNAP)Consolidate programs (job-training)
Reduce/eliminate funding for select programs (Pell grants, housing, abandoned mine payments)
Move all S/L
workers
into
Social SecuritySlide12
What’s the Conventional Wisdom?
There is none!For more information, visit:www.ffis.org
Or contact: Marcia Howardmhoward@ffis.org
Trinity
Tomsic
ttomsic@ffis.org