Federal Budget

On Thursday, Congress passed a temporary continuing resolution that would extend current funding levels until Nov. 21, 2019, thereby temporarily averting a government shutdown. However, President Trump and Congress are still at a standstill regarding the yearlong federal budget. Negotiations over what the budget will look like after that time are ongoing, with several appropriations bills passing in both chambers and several still awaiting passage. Depending on negotiations, there is some talk about a continuing resolution that would last for one full year.

The House of Representatives completed its budget over the summer, but the Senate is still in the process of considering appropriations bills. This week, the Labor-HHS-Education Subcommittee of the Senate Appropriations Committee put forward a draft of a funding bill to be marked up. The draft included a $50 million increase for Head Start, $70 million increase to address the opioid crisis, $1.63 billion for community health centers, and $15.9 billion in Title I grants for low-income schools. The Transportation-HUD bill passed the Senate appropriations committee Sept. 19, with $48.6 billion for the Department of Housing and Urban Development including more than $3 billion for Community Development Block Grants. Ultimately, the appropriations committees in the House and Senate will need to reach a compromise funding bill through a conference committee process. 

At this point in time, a sticking point preventing progress on budget negotiations is border wall funding. Following his Feb. 15 declaration of a national emergency at the border, the president redirected money from the Department of Defense budget to wall construction. Under the National Emergencies Act, Congress has the power to end a national emergency. Both houses of Congress passed a bill to that effect in March; however, the president vetoed the measure. On Wednesday, the Senate, with a handful of Republicans, voted to end the national emergency. It is too soon to tell just how this issue—and with it, the entire federal budget—will turn out.

Family First Transition Act

Congressional child welfare leaders are soon expected to introduce new legislation that would ease the transition for states to the Family First Prevention Services Act (FFPSA). Implementation for FFPSA is scheduled to begin Oct. 1. This newly proposed Family First Transition Act will incorporate concepts from the original Family First Prevention and Services Act, introduced earlier this year by Sens. Debbie Stabenow (D-MI) and Sherrod Brown (D-OH) that aim to make the transition in the child welfare system run smoothly and effectively. This bill has yet to be introduced.

Under FFPSA, the Federal Prevention Services Clearinghouse rates prevention treatments and services as “promising,” “supported,” or “well-supported.” For a state to receive federal IV-E funds, 50% of its expenditures must fall into the “well-supported” category. This proposed legislation would delay this requirement through fiscal year 2021 and then allow both “supported” and “well-supported” programs to count towards the 50% requirement until fiscal year 2024. This will give the clearinghouse enough time to rate and compile a strong collection of evidence-based services for children and families and provide some flexibility for states in the interim.

FFPSA also sets aside funding to help with the transition including $500 million in aid to states, distributed through a formula. This one-time infusion of funds would be targeted toward certain costs related to the transition, but we are still awaiting more detail about allowable expenditures. 

Moreover, states and counties who have current Title IV-E waivers would be eligible to receive additional federal funding to smooth the transition away from these waivers, which are expiring at the end of fiscal year 2019. Many states use these waivers to fund services that the foster care system does not traditionally cover. Under the new proposal, additional temporary federal funds would help offset approximately 90% of the lost funds that will be caused by the termination of the waivers until the end of fiscal year 2021. This proposal would provide financial support for those waiver states and localities for two years. The Alliance will continue to track this legislation and provide more updates on the potential for passage in Congress.

Purdue Pharma Settlement

On Sep. 16, Purdue Pharma, the manufacturer of the opioid OxyContin, announced its intentions to reach a settlement with over 2,000 jurisdictions that have brought legal action against the company. The company is blamed for contributing to the 400,000 opioid deaths in the U.S. over the past 20 years. Under the proposed settlement, the Sackler Family, which owns Purdue Pharma, will turn the company into a “public benefit trust” that will continue to sell opioids and direct the profits—an estimated $10-$12 billion—toward communities grappling with the opioid crisis. It will also contribute around $3 billion in profits from selling off a subsidiary company, Mundipharma.

Multiple states have come out against the settlement. Massachusetts Attorney General Maura Healey says the settlement does not hold Purdue Pharma or the Sackler Family accountable. After conducting in-depth investigations into its business practices, Healey and other state attorneys general argue that Purdue Pharma, under the direction of the Sacklers, did everything it could to aggressively proliferate opioids, without concern to the effect on communities. Furthermore, 48 hours before the announcement of the settlement, New York Attorney General Letitia James uncovered $1 billion in wire transfers from Purdue Pharma to Swiss Bank accounts owned by the Sackler Family—allegedly, to protect those funds from potential settlements.

The Sacklers are currently in negotiations with the bankruptcy court. They are urging the judge to accept their settlement and end all lawsuits against Purdue Pharma. Over 20 state attorneys general have vowed to continue pursuing legal action against the company and the Sacklers. In most recent news, Purdue Pharma asked the court for permission to give out $34 million in employee bonuses—a request that has been vociferously criticized given the circumstances.

View more public policy news  and sign up for the weekly Alliance Policy Radar online.

Support This Work: Donate now to help us continue voicing sector concerns.