Today, the Trump Administration released its initial “skinny” budget proposal for Fiscal Year 2018. The document is entitled “America First: A Budget Blueprint to Make America Great Again.”This document is not a detailed budget, but rather an outline that shows where the Administration has prioritized spending increases and reductions by
This document is not a detailed budget, but rather an outline that shows where the Administration has prioritized spending increases and reductions by federal agency. The more detailed budget is expected to be released in late April or early May.
As previously reported, the Administration has called for a $54 billion increase in defense spending in FY 2018, and thus massive corresponding cuts to domestic programs.
As you will see below, the proposed budget would ELIMINATE:
- Community Development Block Grants (CDBG)
- HOME Investment Partnerships Program
- Economic Development Administration (EDA)
- Transit New Starts
- TIGER Grants
- Minority Business Development Agency
- Community Development Financial Institutions (CDFI) Grants
- Low Income Home Energy Assistance (LIHEAP)
- National Endowment for the Arts (NEA)
- Pre-Disaster Mitigation Grants
- State Criminal Alien Assistance Grants
- Community Services Block Grant (CSBG)
- Weatherization Assistance Program
- The Clean Power Plan
The budget would also and drastically reduce many other programs.
Many of these proposed cuts were expected, as they have been included in proposals we have shared with you from groups like the Heritage Foundation.This budget proposal does not contain the Administration’s plan for tax reform, so there is no mention of key city priorities such as tax-exempt bonds and state and local deductibility.
This budget proposal does not contain the Administration’s plan for tax reform, so there is no mention of key city priorities such as tax-exempt bonds and state and local deductibility.Please use the hashtag #budget when issuing any statements on the budget so we can share with other mayors, Congress, the media and the public.
Please use the hashtag #budget when issuing any statements on the budget so we can share with other mayors, Congress, the media and the public.
Our Strategy and Allies
During our recent Winter Leadership Meeting, 40 mayors met with many of the key policy makers who will decide which parts of the President’s proposals will be implemented, and which will not. Mayors met with House Appropriations Committee Chair Rodney Frelinghuysen (NJ), Senate Majority Leader Mitch McConnell (KY), subcommittee chairs and members of key spending committees, and many others. We were reminded in almost every one of these meetings that “the President proposes, and the Congress disposes.”
Over the coming weeks and months, mayors must tell their success stories about the impact these critical city programs have on the people they are designed to serve. Washington lawmakers and the people who vote for them need to know what key federal-local partnership programs achieve, and what would be lost unless these massive cuts are rejected.
As our CEO and Executive Director Tom Cochran presented to the USCM Leadership, we have many allies:
- We are united with the National League of Cities and the National Association of Counties, who both were just in Washington, DC with over 2,000 members each fighting for our shared investment priorities such as CDBG, public safety, protecting healthcare, and much more.
- We have had a strong coalition of more than 20 national organizations that has helped save CDBG in the past when it was threatened with elimination or reduction. Please remember that national CDBG Week, more important than ever, is April 17-22. Invite your Congressional delegation to your city now, to showcase the many CDBG projects that benefit neighborhoods.
- We are united with the National Urban League on priorities that spur economic development and job creation.
- We are united with Americans for the Arts on maintaining the NEA, which fosters the arts and cultural economies in cities across the country.
- We continue to work with the Children’s Defense Fund on all initiatives that support our youth.
- We are working closely with the “Big 7” state and local government organizations in the fight to protect municipal bonds and state and local tax deductibility.
- We are leading a coalition over 60 organizations fighting to protect municipal bonds.
- We work with over 30 national organizations to promote workforce investment.
- There are eight current Senators and 30 current Representatives who are former mayors, and we are already talking to many of them on our funding priorities.
But as we all know, this year is unlike any other in recent history. Mayors will need to speak with a strong, bipartisan, unified voice. We will need to activate those in the private and nonprofit sectors who would be impacted by cuts. We will need to make sure that Congress understands that this is not about government helping government, but rather investments that help foster job creation, housing, economic development, workforce training, and so much more.
Below are highlights of specific recommendations that would impact America’s cities, metro areas, and the people who live in them. Details in italics are direct quotes from the budget proposal, so our mayors can best understand the arguments being used to support spending recommendations.
This is just our first analysis. More details will be shared in the coming days.
Key Proposed Cuts and Impacts
Community Development Block Grants
“Eliminates funding for the Community Development Block Grant program, a savings of $3 billion from the 2017 annualized CR level. The Federal Government has spent over $150 billion on this block grant since its inception in 1974, but the program is not well-targeted to the poorest populations and has not demonstrated results. The Budget devolves community and economic development activities to the State and local level, and redirects Federal resources to other activities.”
More than 1,200 jurisdictions would not receive the direct allocation of funds used to respond to current and emerging community development needs such as the creation of jobs, development of affordable housing, improvement of existing housing stock, the delivery of vital services (homeless shelters, senior centers, child care centers), and the development of important infrastructure improvements (sanitary water and sewer systems and improved drainage systems). Between Fiscal Years 2005-2016, CDBG created/retained 387,109 economic development related jobs. For every $1.00 of CDBG Investment, another $3.65 in private and public dollars is leveraged.
HOME Investment Partnership Program
“Promotes fiscal responsibility by eliminating funding for a number of lower priority programs, including the HOME Investment Partnerships Program, Choice Neighborhoods, and the Self-help Homeownership Opportunity Program, a savings of over $1.1 billion from the 2017 annualized CR level. State and local governments are better positioned to serve their communities based on local needs and priorities.”
Currently funded at $950 million, HOME is a formula grant program to local governments and states to create affordable housing for low-income people. Since 1992, HOME has created more than 1.2 million affordable homes.
Economic Development Administration
“Eliminates the Economic Development Administration, which provides small grants with limited measurable impacts and duplicates other Federal programs, such as Rural Utilities Service grants at the U.S. Department of Agriculture and formula grants to States from the Department of Transportation. By terminating this agency, the Budget saves $221 million from the 2017 annualized CR level.”
Community Development Financial Institutions (CDFI) Fund
“Eliminates funding for Community Development Financial Institutions (CDFI) Fund grants, a savings of $210 million from the 2017 annualized CR level. The CDFI Fund was created more than 20 years ago to jump-start a now mature industry where private institutions have ready access to the capital needed to extend credit and provide financial services to underserved communities.”
“Provides robust funding for critical drinking and wastewater infrastructure. These funding levels further the President’s ongoing commitment to infrastructure repair and replacement and would allow States, municipalities, and private entities to continue to finance high priority infrastructure investments that protect human health. The Budget includes $2.3 billion for the State Revolving Funds, a $4 million increase over the 2017 annualized CR level. The Budget also provides $20 million for the Water Infrastructure Finance and Innovation Act program, equal to the funding provided in the 2017 annualized CR. This credit subsidy could potentially support $1 billion in direct Federal loans.”
“Reins in Superfund administrative costs and emphasizes efficiency efforts by funding the Hazardous Substance Superfund Account at $762 million, $330 million below the 2017 annualized CR level. The agency would prioritize the use of existing settlement funds to clean up hazardous waste sites and look for ways to remove some of the barriers that have delayed the program’s ability to return sites to the community.”
Clean Power Plan
“Discontinues funding for the Clean Power Plan, international climate change programs, climate change research and partnership programs, and related efforts—saving over $100 million for the American taxpayer compared to 2017 annualized CR levels. Consistent with the President’s America First Energy Plan, the Budget reorients EPA’s air program to protect the air we breathe without unduly burdening the American economy.”
“Safeguards Federal grants to State, local, and tribal law enforcement and victims of crime to ensure greater safety for law enforcement personnel and the people they serve. Critical programs aimed at protecting the life and safety of State and local law enforcement personnel, including Preventing Violence Against Law Enforcement Officer Resilience and Survivability and the Bulletproof Vest Partnership, are protected.”
“Eliminates approximately $700 million in unnecessary spending on outdated programs that either have met their goal or have exceeded their usefulness, including $210 million for the poorly targeted State Criminal Alien Assistance Program, in which two-thirds of the funding primarily reimburses four States for the cost of incarcerating certain illegal criminal aliens.”
Specific references to programs such as the Office of Community Oriented Policing Services (COPS) and Violence Against Women Grants are not contained in this document, so additional information will be provided once we learn more.
FEMA and Homeland Security
“Eliminates or reduces State and local grant funding by $667 million for programs administered by the Federal Emergency Management Agency (FEMA) that are either unauthorized by the Congress, such as FEMA’s Pre-Disaster Mitigation Grant Program, or that must provide more measurable results and ensure the Federal Government is not supplanting other stakeholders’ responsibilities, such as the Homeland Security Grant Program. For that reason, the Budget also proposes establishing a 25 percent non-Federal cost match for FEMA preparedness grant awards that currently require no cost match. This is the same cost-sharing approach as FEMA’s disaster recovery grants. The activities and acquisitions funded through these grant programs are primarily State and local functions.”
Eliminates TSA grants to State and local jurisdictions, a program intended to incentivize local law enforcement patrols that should already be a high priority for State and local partners.
Transit New Starts
“Limits funding for the Federal Transit Administration’s Capital Investment Program (New Starts) to projects with existing full funding grant agreements only. Future investments in new transit projects would be funded by the localities that use and benefit from these localized projects.”
Specific references to future investment to new transit projects to “be funded by the localities…” may portend additional future cuts in the public transit funding.
“The Budget terminates Federal support for Amtrak’s long distance train services, which have long been inefficient and incur the vast majority of Amtrak’s operating losses.”
“Eliminates funding for the unauthorized TIGER discretionary grant program, which awards grants to projects that are generally eligible for funding under existing surface transportation formula programs, saving $499 million from the 2017 annualized CR level.”
Low Income Home Energy Assistance Program and Community Service Block Grants
“Eliminates the discretionary programs within the Office of Community Services, including the Low Income Home Energy Assistance Program (LIHEAP) and the Community Services Block Grant (CSBG), a savings of $4.2 billion from the 2017 annualized CR level. Compared to other income support programs that serve similar populations, LIHEAP is a lower-impact program and is unable to demonstrate strong performance outcomes. CSBG funds services that are duplicative of other Federal programs, such as emergency food assistance and employment services, and is also a limited-impact program.”
The budget eliminates the Senior Community Service Employment Program (SCSEP), a $434 million savings, and cuts job training and employment service formula grants, “shifting more responsibility for funding these services to States, localities, and employers.”
The budget also closes underperforming Job Corps centers for disadvantaged youth.
“Helps States expand apprenticeship, an evidence-based approach to preparing workers for jobs.”
Individuals with Disabilities Education Act (IDEA)
The budget maintains the $13 billion for special education grants – the second largest source of federal funding, next to Title I.
The proposed budget makes an unprecedented federal investment in school choice, including the expansion of charter schools and publicly funded private school options — one of President Trump’s major campaign promises. The budget provides a $1 billion increase to the $15 billion allocation of Title I funds so that school districts can adopt “student-based budgeting” systems and allow “federal, state and local funding to follow the student to the public school of his or her choice.” The budget outline also includes a $168 million increase for Charter Schools Program grants, and proposes a new $250 million private school choice program to help working class families pay for private schools.
National Endowment for the Arts
With only a $148 million annual appropriation, the NEA contributes to a $704 billion arts and culture industry in America, representing over 4 percent of the annual GDP, supports 4.7 million jobs and yields a $24 million trade surplus.
The Administration proposes to substantially reduce the U.S. Department of Energy (DOE) Office of Energy Efficiency and Renewable Energy (EERE), which is the office that oversaw the Energy Efficiency and Conservation Block Grant (EECBG) program. Efforts to reestablish EECBG – a program that provided $2.7 billion for energy efficiency initiatives to cities, counties, and states – would be severely undermined if funding for this office is not funded at the FY 2017 CR level. Additionally, the proposed budget eliminates a number of DOE programs that support cities, including the Weatherization Assistance Program (WAP). WAP is currently funded at $225 million.
Army Corp of Engineers
The President’s FY 2018 budget proposes a $1 billion cut, 16.3%, in the Army Corps of Engineers’ budget, but does not specify where the cuts will be made.
Proposed Increases by Department
Department of Defense
The President’s 2018 Budget requests $639 billion for DOD, a $52 billion increase from the 2017 annualized CR level. The total includes $574 billion for the base budget, a 10 percent increase from the 2017 annualized CR level, and $65 billion for Overseas Contingency Operations.
Department of Homeland Security
The President’s 2018 Budget requests $44.1 billion in net discretionary budget authority for DHS, a $2.8 billion or 6.8 percent increase from the 2017 annualized CR level. The Budget would allocate $4.5 billion in additional funding for programs to strengthen the security of the Nation’s borders and enhance the integrity of its immigration system. This increased investment in the Nation’s border security and immigration enforcement efforts now would ultimately save Federal resources in the future.
Department of Veterans Affairs
The President’s 2018 Budget requests $78.9 billion in discretionary funding for VA, a $4.4 billion or 6 percent increase from the 2017 enacted level. The Budget also requests legislative authority and $3.5 billion in mandatory budget authority in 2018 to continue the Veterans Choice Program.
Proposed Cuts by Department as quoted in budget
Department of Agriculture
The President’s 2018 Budget requests $17.9 billion for USDA, a $4.7 billion or 21 percent decrease from the 2017 annualized continuing resolution (CR) level (excluding funding for P.L. 480 Title II food aid which is reflected in the Department of State and USAID budget).
Department of Education
The President’s 2018 Budget provides $59 billion in discretionary funding for the Department of Education, a $9 billion or 13 percent reduction below the 2017 annualized CR level.
Department of Energy
The President’s 2018 Budget requests $28.0 billion for DOE, a $1.7 billion or 5.6 percent decrease from the 2017 annualized CR level. The Budget would strengthen the Nation’s nuclear capability by providing a $1.4 billion increase above the 2017 annualized CR level for the National Nuclear Security Administration, an 11 percent increase.
Environmental Protection Agency
The President’s 2018 Budget requests $5.7 billion for the Environmental Protection Agency, a savings of $2.6 billion, or 31 percent, from the 2017 annualized CR level.
Department of Health and Human Services
The President’s 2018 Budget requests $69.0 billion for HHS, a $15.1 billion or 17.9 percent decrease from the 2017 annualized CR level. This funding level excludes certain mandatory spending changes but includes additional funds for program integrity and implementing the 21st Century CURES Act. The Budget also reforms the Centers for Disease Control and Prevention through a new $500 million block grant to increase State flexibility and focus on the leading public health challenges specific to each State.
Department of Housing and Urban Development
The President’s 2018 Budget requests $40.7 billion in gross discretionary funding for HUD, a $6.2 billion or 13.2 percent decrease from the 2017 annualized CR level.
Department of the Interior
The President’s 2018 Budget requests $11.6 billion for DOI, a $1.5 billion or 12 percent decrease from the 2017 annualized CR level.
Department of Justice
The President’s 2018 Budget requests $27.7 billion for the Department of Justice, a $1.1 billion or 3.8 percent decrease from the 2017 annualized CR level. This program level excludes mandatory spending changes involving the Crime Victims Fund and the Assets Forfeiture Fund. However, significant targeted increases would enhance the ability to address key issues, including public safety, law enforcement, and national security. Further, the Administration is concerned about so-called sanctuary jurisdictions and will be taking steps to mitigate the risk their actions pose to public safety.
Department of Labor
The President’s 2018 Budget requests $9.6 billion for the Department of Labor, a $2.5 billion or 21 percent decrease from the 2017 annualized CR level.
National Aeronautics and Space Administration (NASA)
The President’s 2018 Budget requests $19.1 billion for NASA, a 0.8 percent decrease from the 2017 annualized CR level, with targeted increases consistent with the President’s priorities.
Small Business Administration
The President’s 2018 Budget requests $826.5 million for SBA, a $43.2 million or 5.0 percent decrease from the 2017 annualized CR level.
Department of State
The President’s 2018 Budget requests $25.6 billion in base funding for the Department of State and USAID, a $10.1 billion or 28 percent reduction from the 2017 annualized CR level. The Budget also requests $12.0 billion as Overseas Contingency Operations funding for extraordinary costs, primarily in war areas like Syria, Iraq, and Afghanistan, for an agency total of $37.6 billion. The 2018 Budget also requests $1.5 billion for Treasury International Programs, an $803 million or 35 percent reduction from the 2017 annualized CR level.
Department of the Treasury
The President’s 2018 Budget requests $12.1 billion in discretionary resources for the Department of the Treasury’s domestic programs, a $519 million or 4.1 percent decrease from the 2017 annualized CR level. This program level excludes mandatory spending changes involving the Treasury Forfeiture Fund.
Department of Transportation
The President’s 2018 Budget requests $16.2 billion for DOT’s discretionary budget, a $2.4 billion or 13 percent decrease from the 2017 annualized CR level.
Other Program and Agency Eliminations
The Budget also proposes to eliminate funding for other independent agencies, including:
- African Development Foundation
- Appalachian Regional Commission
- Chemical Safety Board
- Corporation for National and Community Service
- Corporation for Public Broadcasting
- Delta Regional Authority
- Denali Commission
- Institute of Museum and Library Services
- Inter-American Foundation
- U.S. Trade and Development Agency
- Legal Services Corporation
- National Endowment for the Arts
- National Endowment for the Humanities
- Neighborhood Reinvestment Corporation
- Northern Border Regional Commission
- Overseas Private Investment Corporation
- United States Institute of Peace
- United States Interagency Council on Homelessness
- Woodrow Wilson International Center for Scholars