April 24 Federal Update: GOP Debt Limit Plan Includes Major Cuts to Social Services

Last week, Speaker of the House Kevin McCarthy (R-Calif.) released his long-awaited proposal to increase the debt limit, now standing at $31.4 trillion. In exchange for lifting the debt limit by $1.5 trillion until March 31, 2024, the plan proposes a series of budget cuts McCarthy says will decrease budget deficits by $4.5 trillion over the next decade. President Biden has dismissed budget negotiations, calling for a “clean” debt ceiling increase and delaying any negotiations about the federal budget until after. The Treasury Department says the debt ceiling must be raised as soon as possible and the government could run out of money as soon as June, setting up a tense few months on Capitol Hill.

McCarthy’s plan would immediately return the federal budget to FY 2022 levels, a $130 billion cut, as well as limit yearly increases to one percent for a decade. The plan doesn’t specify the programs that will be cut; however, Ranking Member of the House Appropriations Committee, Rosa DeLauro (C-Ct.), says different agencies have reported the 2022 level budget would lead to drastic impacts, including one million senior citizens losing nutrition services, 1.1 million families losing housing assistance, and 200,000 children losing access to Head Start.

Additionally, McCarthy’s plan would implement work requirements in the Supplemental Nutrition Assistance Program for adults without children until age 56, instead of age 49 under current law. Under the plan, Medicaid would also implement a work requirement of 80 hours per month, which could lead to millions being kicked off. Finally, President Biden’s student debt cancellation program, which is under consideration by the Supreme Court, would be scrapped.

Social Current will continue to monitor budget negotiations and aggressively challenge cuts to critical programs that support the health and wellbeing of vulnerable communities across the country.

HUD Selects Grantees for Choice Neighborhoods Program

The Department of Housing and Urban Development (HUD) announced $98 million in funds for the Choice Neighborhoods Implementation Grants program. The Choice Neighborhoods program takes a holistic approach to developing housing and increasing wellbeing in marginalized neighborhoods. Its three-pronged approach – “housing, people, and neighborhood” – involves redeveloping HUD-assisted properties while simultaneously supporting health, education, and income services in the community. New grocery stores, parks, services, and jobs, for example, are included in the program’s approach. These neighborhood improvement programs lead to private financing and economic growth. Since its inception, the Choice Neighborhoods program has led to 11,000 new mixed-income units in 44 cities, with another 32,000 units under consideration. This batch of grantees come from states across the country, including Arizona, California, Florida, Maine, Maryland, Michigan, Missouri, Nebraska, New Jersey, North Carolina, Ohio, Texas, Oklahoma, and Virginia. 

CSBG Receives Third Funding Installment for the Year

The Department of Health and Human Services (HHS) has released $375 million to tribes, territories and over 1,000 local Community Action Agencies through its Community Services Block Grant (CSBG). CSBG is a federally funded block grant program in the Office of Community Services within the Administration for Children and Families tackling poverty head on in communities lacking resources. The Community Action Agencies have wide leeway to choose what types of services their communities need, including housing, nutrition, employment, education, or healthcare services. Over nine million people are served annually through CSBG. The $375 million installment is the third for FY 2023, bringing the total to $750 million.

New Opportunity to Provide Health Care to Individuals Transitioning Back to Community

The Centers for Medicare and Medicaid Services (CMS) announced a new program to allow states to provide health care to incarcerated individuals as they are about to reenter their communities. The Medicaid Reentry Section 1115 Demonstration Opportunities would allow the utilization of Medicaid funds to cover health services like substance use disorders and other chronic health conditions for up to 90 days prior to release. CMS cited a study from the National Institute on Drug Abuse, which says as much as 65 percent of people who are incarcerated suffer from substance abuse disorders. It goes on to say this population is at increased risk of overdosing in the first few weeks of reentry without treatment. Providing critical health care services to this population before release lessens the challenges of transitioning back to the community and reduces recidivism.

Subscribe to the Policy and Advocacy Radar to receive our biweekly policy roundup, which includes commentary on issues in Social Current’s federal policy agenda, opportunities to take action, and curated news and opportunities.