Summer Update: Senate Committee Revises Bush Budget
Overview
of the President’s FY 2003 Budget Proposal for
Employment and Training Programs
On February
4, 2002, the Bush administration released its proposed FY 2003 budget.
As promised, the budget calls for large hikes in military and domestic
security spending and belt-tightening in other federal programs.
The proposed budget for the Department of Labor (USDOL) reflects
the steepest reduction in funding of any cabinet agency.
The budget included
cuts in USDOL funding for programs under the Workforce Investment
Act (WIA). In announcing the WIA cuts, the administration noted
the availability of large amounts of carryover in the states. State
and local program administrators have argued that the carryover
is not as large as the administration believes and areas that have
spent resources for dislocated workers will be severely affected
by these cuts. Here is a brief summary of the cuts in the major
WIA funding streams from the amounts appropriated in FY2002:
-
Adult: $900 million (down from
$950 million); a reduction of $50 million
-
Dislocated Worker: $1.383 billion
(down from $1.549 billion); a reduction of $166 million
- Youth Activities: $1.001 billion
(down from $1.128billion); a reduction of $127 million
- Youth Opportunity Grants: $44
million (down from $225 million); completing the programs of existing
grantees, but eliminating this program in the future
Note:
WIA is “forward funded” and operates on a Program Year.
Funds appropriated in FY 2003 will be available for the Program
Year which runs from July 1, 2003 through June 30, 2004.
In addition, the administration proposes a change in
WIA to allow states and localities to transfer up to 40% between
adult and dislocated worker programs. Current law allows a 20% transfer.
As a result of this change, there will be increased competition
for local resources between programs serving disadvantaged adults,
including welfare recipients, and those serving dislocated workers.
The
administration’s budget also eliminates nationally-funded training
and employment programs including:
- H-1B Training Programs: The
administration is proposing to eliminate this program, shifting
the money from a training fund for American workers, which is
financed by fees from the H-1B program, to be utilized to clear
up the backlog in processing permanent foreign labor certification
requests for employers.
- Migrant and Seasonal Farmworker Programs: The Bush administration proposes to eliminate $83
million in funding for migrant and seasonal farmworker programs
($81 million in the DOL budget and $2 million in the Education
Department budget).
- National Skills Standards Board: The NSSB is a partnership of employers, labor, education and community
groups. It has helped to develop voluntary partnerships in a range
of industries, including manufacturing. The Bush budget would
eliminate $4 million in funding for the NSSB and its support of
industry-labor partnerships in the development of skill standards
The Bush administration
is also proposing significant changes to the administration of the
Unemployment Insurance (UI) program. Known as “UI Devolution,”
this proposal would transfer responsibility for administering UI
– and the Employment Service, which is funded from the same
federal tax – to the states by 2005. Concerns raised by the
AFL-CIO, public employee unions, and worker advocates in the UI
stakeholder process in 2000, including the need to improve access
and adequacy of UI benefits for part-time and low wage workers,
are not included in this new proposal.
The AFL-CIO
has prepared an analysis of the Bush 2003 Budget proposal. You
can access that analysis on the AFL-CIO website at: http://www.aflcio.org/news/2002/0205_budget_analysis.htm
In July the Senate Appropriations Committee reported out a bill that includes funding levels above the President's recommendations. For information on Senate action (click here). The House Appropriations Committee is not expected to take up Labor-HHS Appropriations until September.
Layoff
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