Washington Watch: NC Counties Federal Goals: FY24 Appropriations Outcomes and Legislation to Monitor
The following publication was written by Strategics Consulting for the North Carolina Association of County Commissioners' (NCACC) County Quarterly article series “Washington Watch.”
After months of debates on Capitol Hill, all Fiscal Year 2024 (FY24) Appropriations bills were passed in late March 2024, effectively funding federal programs through September 30, 2024. The FY24 Appropriations provide $773 billion in non-defense discretionary spending ($1.6 trillion total). The March 2024 federal spending package directly addresses several of North Carolina counties’ federal objectives:
The U.S. Department of the Interior’s (DOI) Payments in Lieu of Taxes (PILT) program was fully funded. DOI is currently collecting data to calculate payments scheduled for June 2024. Local governments should ensure their System of Award Management (SAM) account is active and banking information is up to date.
The Workforce Innovation and Opportunity Act (WIOA) was authorized $5.7 billion to fund community programs designed for challenges facing job seekers and employers.
Regarding disaster preparation, assistance, and mitigation, approximately $3.2 billion is dedicated to the U.S. Federal Emergency Management Agency (FEMA) for grants to state and local governments, including $324 million for the Staffing for Adequate Fire and Emergency Response (SAFER) grant program to assist fire departments and first responders. The National Flood Insurance Program (NFIP) was also reauthorized. FEMA funded 22,150 additional U.S. Customs and Border Patrol (CBP) agents and officers but cut its Shelter and Services Program funding.
Expanding high-speed broadband access was a popular bipartisan issue. FY24 Appropriations continued funding for rural broadband programs at the U.S. Department of Agriculture, Office of Rural Development (USDA-RD); namely, the ReConnect, Distance Learning and Telemedicine Grants, and the Community Connect Grant programs. There was emphasis on rural broadband connectivity involving several programs and critical policy riders that will make it easier for counties to provide critical mental health services to residents. However, $500 million was cut from USDA-RD programs nationwide.
Pro Tip: For USDA-RD grant proposals with potential eligibility issues, counties’ proposal/project managers should contact the North Carolina Rural Development State Office early in the project’s feasibility stage for clarification.
In a swing of momentum against broadband accessibility, the U.S. Federal Communications Commission (FCC) stopped accepting new applications in February for the Affordable Connectivity Program (ACP), a monthly benefit discounting up to $30 for internet service to over 23 million low-income homes. Without additional funding, May 2024 was the final month of ACP reimbursements. A $7 billion bill to extend the ACP until 2025 is stalled in Congress, as is the separate Promoting Affordable Connectivity Act, a bill that would sustainably fund the ACP by removing it from the appropriations process and incorporating it into Universal Service Fund (USF) and enabling contributions from telecommunications companies.
A significant moment in behavioral health and substance use disorder (SUD) program funding, providing counties autonomy with treatment options, the FY24 federal spending deal reforms the Institutions for Mental Disease (IMD), making permanent the option for states to waive IMD exclusions for SUD treatment and services. For context, the federal government does not match state payments for services to 21 - 64-year-old Medicaid enrollees in certain inpatient facilities; however, reimbursement is available via several exceptions to the IMD exclusion. This option was first provided in the 2018 SUPPORT Act, granting state Medicaid programs federal match options for SUD treatment in certain IMDs through temporary waivers.
Supporting the SUPPORT Act: The 2018 Substance-Use Disorder Prevention that Promotes Opioid Recovery and Treatment for Patients and Communities (SUPPORT) Act funds community-based SUD-related treatment and recovery programs and grows the behavioral health workforce. Consider contacting the Offices of Sen. Tillis and Sen. Budd to request the SUPPORT Act be reauthorized before September 2024.
FY24 Appropriations significantly benefitted North Carolina counties’ priorities of funding health, human, and economic services programs, with sustained funding for U.S. Housing and Urban Development’s (HUD) Community Development Block Grants (CDBG). The Temporary Assistance for Needy Families (TANF) was also extended (which was last reauthorized in 2005 and has existed through piecemeal extensions since 2010). Additionally, local health departments will now receive direct federal funding, which is big news for the multitude of county health systems operating local departments. Finally, FY24 also saw an increase in federal funding for the Special Supplemental Nutrition Program for Women, Infants and Children (WIC), and a $725 million bump to the Child Care and Development Block Grant (CCDBG).
Regarding healthcare for county detainees, the FY24 Appropriations bills require states to suspend an individual’s Medicaid benefits immediately upon incarceration. The suspension offers a preferred option of reinstating an individual’s benefits upon release from incarceration, rather than fully reenrolling in Medicaid. This suspension holds whether the individual is detained prior to conviction or during post-adjudication sentencing.
Other Medicaid moves in FY24 spending include:
An $8 billion annual cut to Disproportionate Share Hospital (DSH) payments, which offsets costs for county-owned hospitals treating disproportionately large numbers of Medicaid beneficiaries, is delayed until January 1, 2025;
Medication Assisted Treatment (MAT) coverage is now a permanent offering for state plans; and,
Title IV-B Child Welfare Services grants, which provide flexible funding to support family services and prevent child abuse, are extended through December 31, 2024.
Aside from the appropriations process, there are also important ongoing legislative negotiations that will affect counties’ programs and funding.
Regarding funding and flexibility in services for older Americans and veterans, on February 6, 2024, the U.S. Department of Health and Human Services (HHS) announced updated regulations to the Older Americans Act (OAA). However, the OAA was only temporarily extended and is also due for reauthorization in September. Currently, the legislation is being negotiated in the Senate’s Health, Education, Labor, and Pensions (HELP) Committee, whose membership includes Sen. Ted Budd (R-NC).
The U.S. Environmental Protection Agency (EPA) recently announced funding and regulations news for emerging contaminants and drinking water, setting maximum contaminant levels (MCLs), on several polyfluoroalkyl substances (PFAS) in drinking water. The new federal regulation means hundreds of water systems must routinely monitor for PFAS and report the results to customers. Utilities that have drinking water contaminated with PFAS exceeding the MCLs have five years to integrate technology that will bring them into compliance. The Bipartisan Infrastructure Law (BIL) appropriated $1 billion (FY2022 to FY2026) in allocations and competitive funding to address emerging contaminants through the Clean Water State Revolving Fund (CWSRF) Emerging Contaminants funding. Excluding BIL funding, FY24’s federal budget provides $2.77 billion for the CWSRFs.
With regard to spending American Rescue Plan Act (ARPA) State and Local Fiscal Recovery Funds (SLFRF), the U.S. Department of Treasury recently released it SLFRF FAQ guidance, providing additional flexibilities – which NCACC supported – to help counties obligate their remaining SLFRF funds by December 31, 2024. A bill intended to remove these helpful clarifications was defeated in the Senate on May 15, 2024. Given that threats to ARPA flexibility and funding are not over, North Carolina counties should continue sharing positive stories regarding their ARPA-funded programs with their members of Congress. Two more important dates related to the SLFRF program are:
Funds for Title I projects and Surface Transportation projects must be expended by September 30, 2026; and,
Funds for all other eligible uses must be expended by December 31, 2026.
In conclusion, the FY24 Appropriations package will sustain funding for several of North Carolina counties’ high priority federal funding programs and legislative goals. Significant reauthorizations include PILT, WIOA, CDBG, and TANF. More broadly, there is increasing momentum toward supporting mental and behavioral health services, treating substance use-related disorders, and improving accessibility to healthcare via broadband. Conversely, popular and transformative programs like the SUPPORT Act and the Affordable Connectivity Program will expire soon without compelling advocacy.
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Update to NCACC’s Spring 2023 County Quarterly, “2023 Farm Bill – Supporting Agriculture and Food Programs for Years to Come”
Last authorized for five years in 2018, the Farm Bill is set to expire on September 30, 2024. On May 17, 2024, the U.S. House of Representatives Agriculture Committee released its first version of the new, five-year 2024 Farm Bill. (Available on the U.S. House of Representatives website at www.agriculture.house.gov/farmbill.) The House began its internal “markup” process on May 23, 2024 where a major outstanding topic of debate is Supplemental Nutrition Assistance Program (SNAP) benefits. From there, the bill will be passed onto the Senate for negotiation and approval.
Meanwhile, members of Congress have introduced legislation that will likely be included in the 2024 Farm Bill and directly impact counties’ interests:
Treating Tribes and Counties as Good Neighbors Act (S.697/H.R. 1450) extends eligibility for the Good Neighbor Authority program to counties, allowing reinvestments of receipts gained from restoration projects.
Rural Partnership and Prosperity Act of 2023 (S. 3309) creates a competitive grant program to provide multiyear, flexible funding for rural development initiatives, and another expanding technical assistance in rural areas via the Rural Partners Network.
Expanding Childcare in Rural America Act (S.1867) would improve the availability and affordability of childcare in rural communities through childcare workforce professional development and retention activities.
The 2018 Farm Bill provided several important benefits for North Carolina counties:
$350 million for rural broadband infrastructure and increased flexibility for USDA broadband loans and grants.
Permanent reinstatement of a USDA Undersecretary to oversee more than $200 billion in the USDA-RD portfolio.
$150 million for the Water and Wastewater Program to finance critical infrastructure projects and provide rural communities access to affordable and clean water.
SNAP full reauthorization, maintaining eligibility and work requirements with expanded job training programs.
Fully funding all 12 titles of the 2024 Farm Bill reauthorization would maintain these and other vital provisions of the 2018 Farm Bill. Counties should develop a timely strategy with clear talking points in coordination with NCACC before contacting their North Carolina Congressional Delegation regarding the 2024 Farm Bill and associated legislation slated for inclusion.
