Proposed Trump budget would slash state, local grant programs

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Dozens of federal grants to state and local governments would be cut significantly under the $4.8 trillion budget for fiscal 2021 released Monday by the Trump administration.

Among the programs targeted for elimination are Community Development Block Grants and the HOME Investment Partnerships programs which are popular with mayors and many members of Congress who determine spending levels. The White House said eliminating them would save $4.8 billion in 2021.

The Trump administration released its proposed 2021 budget on Monday

House Appropriations Committee Chairwoman Nita Lowey, D-N.Y., described Trump’s budget proposal as “a disastrous repeat of the misplaced priorities and callous cuts he has pursued unsuccessfully in past requests.”

“This reckless proposal backtracks on funding levels agreed to in the bipartisan budget agreement and would gut investments in America’s working families with deep cuts to critical programs like medical research, education, and climate science,” Lowey said. “Instead of prioritizing policies to strengthen our national security and bolster American leadership and values, the president once again proposes wasting billions of taxpayer dollars on an unnecessary and divisive border wall.”

The budget sets up what appears likely to be a fourth consecutive year of battle between the administration and Democrats in Congress over domestic spending programs.

House Appropriations Committee Chairwoman Nita Lowey, D-N.Y., described Trump’s budget proposal as “a disastrous repeat of the misplaced priorities and callous cuts."

The Democratic-controlled House also is trying to push through major infrastructure legislation this year including a reauthorization of the five-year FAST Act which expires at the end of September.

The proposed budget supports a 10-year reauthorization of surface transportation programs, but at the same time proposes a $3.2 billion or 13% reduction in funding for the Department of Transportation.

Trump said last week in his State of the Union address he supports the $278 billion, five-year reauthorization approved by the Senate Environment and Public Works Committee.

But House Transportation and Infrastructure Committee Chairman Peter DeFazio, D-Ore., noted in an interview Friday the Senate bill doesn’t yet include transit or railroad components that are the jurisdiction of other Senate committees.

“I expect we will act on the bill before the end of June,” DeFazio said. “Text as soon as it’s done. We are writing the first transformative surface transportation bill since Dwight David Eisenhower so there’s a whole lot of new information, titles and emphasis in this bill that haven’t been considered before. So it’s an issue of first impression and it’s a difficult crafting process. We spent a lot of time taking input from a whole host of stakeholders and other members of Congress.”

The administration budget said it supports reauthorization of all modes of transportation, but its proposed railroad component would shift responsibility for some of Amtrak’s long distance routes to bus carriers.

Likewise, the budget proposes ending federal support for programs such as CDBG grants to communities, which it says have been found in studies to be “ineffective at targeting funds to the areas of greatest need, and many aspects of the program have become outdated.”

As a replacement for the HOME program, the budget said, “The White House Council on Eliminating Regulatory Barriers to Affordable Housing is working to identify and support successful practices for removing burdensome rules and regulations that raise the cost of housing development.”

The CDBG and HOME programs are administered by the Department of Housing and Urban Development, which would face an overall funding cut of $8.6 billion, or 15.2% less than the current 2020 budget.

In education, the budget proposed consolidating 29 programs it labels as “narrowly focused or duplicative” into one $19.4 billion block grant to states. “The new program would give states and school districts the flexibility to better meet the needs of their students and families, eliminating federal intrusion into state and local education systems,” the budget said, citing a proposed savings of nearly $4.7 billion.

Overall proposed funding for the Department of Education would be reduced $5.6 billion to to $66.6 billion, a 7.8% cut.

Even with those proposed cuts, there would be an $100 million increase in the nearly $13 billion spent annually on the Individuals with Disabilities Education Act (IDEA) Part B Grants to states “This increase will provide more resources for states to provide special education and related services for over 7 million students with disabilities served by IDEA Part B,” the budget said. “Additionally, the budget continues to fund all other IDEA grant programs at the 2020 enacted levels.”

Elsewhere in education, the budget proposes to restructure and streamline the TRIO and Gaining Early Awareness and Readiness for Undergraduate Programs (GEAR UP) programs by consolidating them into a $950 million state formula grant.

The budget proposes to sell the transmission assets owned and operated by the Power Marketing Administrations (PMAs), including those of the Southwestern Power Administration, Western Area Power Administration, and Bonneville Power Administration. The Budget also proposes to authorize the PMAs to charge rates comparable to those charged by for-profit, investor-owned utilities, rather than being limited to cost-based rates, for electricity.

Funding for the Department of Labor would be cut by $1.3 billion, a 10.5% reduction that would include a savings of $500 million from eliminating job training programs considered to be “duplicative and unproven.”

However, the Trump administration said its 2021 budget provides $810 billion in outlays for aid to state and local governments, an increase of 2.4% from spending in 2020, which is estimated to be $791 billion. Medicaid accounts for 55% of the total.

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