By Josie Hathway
December 8, 2003

The FY '04 Omnibus appropriations bill, The Consolidated Appropriations Act of 2004, (HR 2673), includes a rescission of unexpended Welfare-to-Work (WTW) funds. HR 2673 has passed in conference and now has to be passed in the House and the Senate. The House plans to vote on the omnibus on Monday, December 8. The Senate vote may be delayed and will not occur until January 2004.

The rescission will be effective on the date of enactment of the omnibus, which will most likely be in January 2004. The rescission will affect WTW dollars that have not been spent at the time of enactment of the omnibus.

Due to a two-year extension for spending of WTW dollars appropriated in Fiscal Year 1999, states and local areas had five years to spend WTW dollars, dependent upon when the grantee was awarded the funds from the U.S. Department of Labor. For several states and local areas, the five-year time limit ends on September 30, 2004.

Earlier in the appropriations negotiation process, the Senate had backed off from considering the WTW rescission due to information from several cities on the impact of cuts, including the elimination of services for city residents moving from welfare-to-work and lay-offs. The Senate Appropriations Committee also received a letter from the Senate Finance Committee Chair and Ranking Member, Senators Charles E. Grassley (IA) and Max Baucus (MT) asking the Senate Appropriations Committee to not rescind the WTW dollars. However, as the negotiations process moved forward, the Senate returned to consideration of the WTW rescission in order to provide an offset for other funding in the omnibus bill. At this point, the only possibility for the rescission not to take place is if it is taken out on the House or Senate floor.