By Larry Jones and Conference Staff
May 11, 2009

The President released the details of his 2010 budget proposal on May 7, setting the stage for congressional action on the 12 appropriations bills that must be approved by the White House and Congress to keep federal agencies and programs operating in the new fiscal year. This year’s budget calls for significant increases in many key city priorities including community development block grants, law enforcement, homeland security, and High-Speed rail and intercity passenger rail systems. It also calls for the creation of several new housing programs to assist local communities to revitalize severely distressed communities, rehabilitate housing for low- income families.

The U.S. Conference of Mayors is pleased that the President’s budget includes increases in many key areas. We are concerned that no funds are included for the Energy Efficiency and Conservation Block Grants (EEBCG). The budget request referenced the $3.2 billion appropriated under the American Reinvestment and Recovery Act for the EECBG program. However, the official FY 2010 budget request does not include additional funds for EECBG, which was authorized in the Energy Independence and Security Act of 2007 to be funded at $2 billion annually.

Below is a more detailed summary of the funding levels for key city priority programs listed under major categories. A budget chart listing more programs and comparing funding levels in the proposed 2010 budget with the current and previous fiscal year will be available next week at usmayors.org.

The overall Community Development Fund is increased from $3.9 to $4.5 billion. Formula grants provided to local governments to promote community and economic development would be increased from $3.6 billion to $4.1 billion. The budget mentions that legislative reforms will be proposed to modernize the CDBG formula “to better target funds to communities with the greatest economic need.” The proposed legislation will “include a hold harmless provision to transition communities over time to the improved formula.”

There are three new initiatives or set asides in the CDBG account: $150 million for a Sustainable Communities Initiative (for improved coordination of transportation and housing investments); $40 million for Metropolitan Challenge Grants (to provide incentives to encourage sustainable growth patterns); and $10 million for a joint HUD-DOT research effort to advance transportation and housing linkages.

Choice Neighborhoods, a new HUD program, is funded at $250 million to provide competitive grants to transform neighborhoods experiencing extreme poverty. The program replaces HOPE VI, the revitalization of severely distressed public housing program. The Housing Trust Fund, also a new HUD housing program, is funded at $1 billion for the production, preservation, and rehabilitation of housing for extremely low- and very low-income families.

The Homeownership Investment Partnerships (HOME) program is funded at the same level as last year’s funding of $1.825 billion. Homeless Assistance Grants are increased from $1.677 billion to $1.794 billion. Section 8 rental assistance is increased to $17.936 billion, which is $1.769 billion more than last year’s funding. The public housing capital fund is reduced to fund an increase in the public housing operating fund. The capital fund would be funded at $2.244 billion, $206 million less than last year’s funding, while the operating fund would be increased from $4.455 billion to $4.600 billion. The HUD budget also proposes to create an Energy Innovation Fund at $100 million. The energy fund would spur private sector investment in the energy efficiency of the nation’s housing stock.

The FY 2010 budget proposal includes $1.07 billion for state and local law enforcement assistance through the Office of Justice Programs. This includes $517 million for Byrne Justice Assistance Grants, five percent less than the $546 million available this year. It also includes $59 million for a new initiative which combines funding for drug, mental health, and problem'solving courts. Previously these courts were funded (at $57 million this year) through separate programs. Finally, it includes $151 million for DNA capacity-building, training, and technical assistance grants to state and local governments as well as innovative research on DNA analysis and the use of forensic evidence, and $35 million for the Paul Coverdell Forensic Science Improvement Grants to state and local governments.

Programs administered by the COPS Office would be funded at $415 million next year. This includes $298 million for hiring grants and proposes the same program guidelines as were included in the Recovery Act, three years of funding with no cap for each officer, no match requirement, and a one-year retention requirement. The budget also proposes $20 million for a new police integrity program, $27 million for methamphetamine grants, and $16 million for Secure our Schools grants.

A total of $246 million is proposed across several departments for programs to assist ex-offenders to reenter communities. Justice Department funding for Second Chance Act/Prisoner Reentry would increase from $25 million this year to $100 million next year for programs administered by the Office of Justice Programs. In addition, $13.8 million is provided for the Bureau of Prisons. At Labor, the budget proposes $115 million for Reintegration of Ex-offenders, up from $108 million this year. At Education, the budget proposes $17 million, the same as this year for State Grants for Workplace and Community Transition Training for Incarcerated Individuals.

The Justice Department budget also contains language which would remove the restriction on access by state and local police and prosecutors to aggregate federal crime gun trace data relating to investigations of individual crimes. The language, however, would not allow elected officials or local law enforcement to discuss anything relating to that data publicly. This is one limitation that has come about as a result of the so-called Tiahrt Amendment. Other Tiahrt restrictions are not changed.

Funding for State Homeland Security Grants would increase seven percent from $890 million this year to $950 million next year. Urban Area Security Initiative Grants would increase six percent from $837 million this year to $887 million next year. Funding for Emergency Operations Centers (at $35 million this year), Inter-city Bus Security (at $12 million this year) and trucking security (at $8 million this year) would be eliminated. Funding for transportation and infrastructure protection would be reduced from $862 million this year to $550 million next year.

Overall funding for Firefighter Assistance Grants would be reduced 24 percent from $775 million this year to $590 million next year. Within this funding the Staffing for Adequate Fire and Emergency Response (SAFER) program would double from $210 million this year to $420 million next year, but funds for the Assistance to Firefighter grants would be cut 70 percent from $565 million this year to $170 million next year.

The President’s budget request provides $26.4 billion for the Department of Energy.  The Department of Energy’s Office of Energy and Efficiency and Renewable Energy programs received $2.32 billion, an increase of $140 million, or approximately 6.4 percent above the FY 2009 appropriation. The Federal budget request referenced the $3.2 billion appropriated under the America Reinvestment Recovery Act for the Energy Efficiency and Conservation Block Grant (EECBG) program. However, the official FY 2010 budget request does not include additional funds for EECBG, which was authorized in the Energy Independence and Security Act of 2007 at $2 billion for FY 2010.

The President’s budget request for the Weatherization and Intergovernmental Activities represents a decrease of $215 million from the FY 2009 appropriation. The budget request reduces the Weatherization program by $230 million. However, this proposed reduction reflects $5 billion in available funds for the Weatherization program from the America Reinvestment Recovery Act. It also includes a $25 million increase for the State Energy Program. The Renewable Energy Production Incentive would be eliminated. The budget request for the Office of Electricity and Energy Reliability, which has the lead on modernizing the electric grid, is $208.0 million, $71 million above the FY 2009 budget.

The President proposes to increase the U.S. Department of Transportation’s (DOT) budget from $71.5 billion in FY 2009 to $73.5 billion in FY 2010. This includes $1 billion to sustain a new federal commitment to High-Speed Rail and Intercity Passenger Rail. This is in addition to the $8 billion provided in the American Recovery and Reinvestment Act of 2009. This investment will lead to the creation of express and regional High-Speed corridors linking cities and their metropolitan areas. Funding for Amtrak would increase from $1.49 billion to $1.5 billion.

The budget increases the Federal Highway Administration’s (FHWA) budget from $41.6 billion to $41.8 billion. And, it would increase the Federal Transit Administration’s (FTA) budget from $10.2 billion to $10.3 billion. Speaking to the next surface transportation law and the continued deterioration of the Trust Fund, the budget states “The Administration intends to work with Congress to reform surface transportation programs to improve the systems financial viability, enhance transit options, and generate better investments to reduce congestion and improve safety.” It further states that specific policy proposals for the surface transportation reauthorization have yet to be fully formed. The current federal surface transportation program, which was authorized by the Safe, Accountable, Flexible, Efficient Transportation Equity Act: A Legacy for Users (SAFETEA-LU) in 2005, is set to expire September 30 of this year.

To highlight the imbalance between projected revenues and spending out of the trust fund, the budget shows significantly reduced trust fund appropriations for certain programs to maintain positive cash balances in the trust fund. To maintain overall baseline levels for these programs, the budget also assumes new discretionary General Fund appropriations.

Referencing the Administration’s surface transportation reauthorization theme of linking transportation and land use through investments in livable communities, the HUD section of the budget provides $150 million for the U.S. Housing and Urban Development’s (HUD) Sustainable Communities Initiative. The goal of the Sustainable Communities Initiative is the integration of transportation and housing investments that result in more regional and local sustainable development patterns, reduced greenhouse gas emissions, and more transit-accessible housing choices for residents.

The budget would increase spending on Federal Aviation Administration (FAA) Operations from the current funding level of $9 billion to $9.3 billion in FY 2010. The Airport Improvement Program (AIP) is flat at $3.5 billion and FAA Facilities and Equipment would increase from $2.7 billion to $2.9 billion. Of this amount, $865 million would be budgeted for the Next Generation Air Transportation System (NextGen), a long-term effort to improve the efficiency, safety, and capacity of the air traffic control system by moving from a ground-based radar surveillance system to a more accurate satellite-based surveillance system.

The President’s budget would increase overall funding for the Environmental Protection Agency (EPA) to $10.5 billion, a $2.9 billion increase over the current fiscal year. This would be the highest level of funding for EPA in its 39-year history.

The Clean Water State Revolving Loan Fund, a major means of financial support for local wastewater treatment facilities, was increased dramatically to $2.4 billion from $689 million in FY 2009. The Drinking Water State Revolving Loan Fund also fared very well, receiving $1.5 billion from $829 million in FY 2009. These are the highest levels that have been proposed in many years.

The Superfund program was raised slightly to $1.272 billion, from $1.25 billion in FY 2009. The Brownfields program that is geared towards local governments saw a slight increase from $97 million enacted in FY 2009 to $100 million in FY 2010. EPA has proposed $475 million in the Great Lakes Restoration Initiative and in the area of climate change, EPA is asking for $17 million to design a rule establishing a greenhouse gas registry and $5 million to create a cap and trade offsets methodology.

The President’s budget for the Department of Labor (DOL) calls for $3.83 billion in funding for Workforce Investment Act (WIA) programs – a $200 million increase over the FY 2009 funding levels. WIA Adult, Dislocated Worker and Youth formula funding streams remain essentially level funded from FY 2009. WIA adult formula grants would be funded at $861.54 million and dislocated worker job training grants would be funded at $1.1 billion. The budget decreases funding of the dislocated worker national reserve to $229.16 million – a $54 million cut from FY09 funding levels. Youth training would be maintained at $924 million for WIA Youth formula grants. Also, the YouthBuild program would be funded at $114.7 million, a $44 million increase over the current fiscal year.

The President’s budget provides $115 million for Reintegration of Ex-Offenders, which includes $88.5 million for Youth Offender Reentry programs. This represents an increase of $7 million in funding over the FY 2009 level. The Job Corps program would be funded at $1.7 billion, a $17 million increase over FY 2009 levels. Included in this amount is funding for operations, construction, rehabilitation and acquisition of Job Corp centers, and other necessary expenses of the Office of Job Corps.

The Administration’s budget also calls for the creation of a new $135 million program for a Career Pathways Innovation fund (formerly Community-Based Job Training Grants), a competitive grant program for community college led partnerships to develop or expand career pathway programs. It further calls for a new $15 million Workforce Data Quality Initiative – competitive grants to support the development of longitudinal data systems that integrate education and workforce data to provide timely and accessible information to consumers, policymakers and others.

For FY 2010, the President is requesting $46.7 billion in discretionary spending for the Department of Education, a $1.3 billion increase over FY 2009. The President’s mandatory funding proposals would include a 57% increase in Pell Grant Aid available, supporting 24% more students, and increases the Pell Grant to $5,500. The budget request also proposes an expanded, modernized Perkins Loan program with $6 billion a year in new loan volume – six times the current Perkins volume.

The budget requests $12.9 billion for Title I Grants, the so called No Child Left Behind (NCLB) program, to assist Local Educational Agencies (LEAs). This amounts to a decrease of $1.5 billion or 10.4 percent over the FY 2009 level, reflecting the $10 billion provided for Title I Grants to LEAs in the Recovery Act, much of which will be made available during FY 2010.

Focused on laying the foundation for the expansion of early childhood education, the President’s Zero-to-Five Initiative is funded at $500 million to encourage LEAs to use Title I Recovery Act funds to start or expand Title I preschool programs.

The budget calls for $1.5 billion for Title I School Improvement Grants, an increase of $1 billion to help ensure that states and LEAs have the resources to develop and implement comprehensive, research-based improvement plans for underperforming schools, including middle schools and high school “dropout factories” that graduate 60 percent or fewer of their students. Also included is $517 million for the Teacher Incentive Fund, a $420 million increase or five times the FY 2009 levels, to encourage school districts to develop compensation plans to reward principals and teachers who raise student achievement, close achievement gaps, and work in challenging schools. The program, which received $200 million in ARRA, funds grants to school districts with performance pay programs for teachers.

The Administration requested $162.5 million for Reading First Grants, an increase of $50 million over FY 2009 levels. This will fund up to 52 new projects to prepare pre'school children for success by utilizing research-based instruction methods to improve the reading skills of students in high-poverty, low-performing elementary schools. Two other key education programs would be level funded: the 21st Century Learning Centers at $1.13 billion and Advance Placement at $43.5 million. Also the Foreign Language Assistance program would be funded at $26.3 million to support partnerships with school districts for language learning from kindergarten through high school.

The President’s FY 2010 budget includes $3 billion for the Centers for Disease Control and Prevention (CDC) and Health Resources and Services Administration (HRSA) to enhance HIV/AIDS prevention, care, and treatment. This amount is $107 million above the funding level in FY 2009 and it includes an additional $53 million for CDC to support domestic HIV/AIDS testing and surveillance, capacity building, and HIV prevention activities among high-risk groups. The Administration also requested an additional $122 million to enable the Head Start program to sustain the FY 2009 increase in children served in FY 2010.

Re-assortment of avian, swine and human influenza viruses has led to the emergence of a new strain of H1N1 influenza A virus, (2009 – H1N1 flu) that is transmissible among humans, and as of April 28, 2009 is confirmed to have caused infections in humans in Mexico, the United States, Canada, Spain, and the United Kingdom. On April 28, 2009 the President announced a supplemental request of $1.5 billion for the Federal response to this outbreak. These funds, in addition to the FY 2010 Budget request of $584 million and the remaining balances, will allow HHS to develop, produce, and distribute antiviral, vaccines, personal protective equipment, and other medical counter-measures, as well as conduct public health surveillance and response efforts in the face of the current outbreak.

The President also requested $3.5 billion for the Substance Abuse and Mental Health Services Administration (SAMHSA), an increase of $59 million above FY 2009. A total of $49 million was requested for the Administration for Children and Families (ACF), a net decrease of $1.1 billion below the funding level for the current fiscal year. The President’s budget includes $17.1 billion for Temporary Assistance for Needy Families, $7.3 billion for Foster Care and related programs, $4.6 billion for Child Support Enforcement and Family Support, and $124 million for a new program to provide funds to States for evidence-based home visitation programs for low-income families.

The Administration is requesting $161 million each for the National Endowment for the Arts and the National Endowment for the Humanities. Both programs would be slightly increased by $6 million over the $155 million funding level for the current fiscal year. This marks the third consecutive year that these cultural agencies have received an increase. Also the Arts Education program would be level funded at $35.1 million.