Congress returns on Tuesday to begin a “lame-duck” session that will begin to discuss how to deal with the so-called fiscal cliff. It’s called a lame –duck session because it includes more than 80 members of the House and Senate who will not return next January due to retirement, defeat or departure for another political office.
The session will be significant to the economy. Members return after an election that has strengthened the President’s hand and an election that is causing some members of Congress to re-think their strategy both toward the cliff and toward dealing with each other.
Some of the initial comments from the president, Speaker John Boehner (R-Ohio) and Senate Majority Leader Harry Reid (D-Nevada) leave open the possibility of compromise. But it was unclear just how real that compromise is with much of Washington working overtime in trying to examine every statement and comment for clues.
The President has invited leaders from both parties to the White House to open the discussion. Congress is then likely to break this week for the Thanksgiving Day holiday while discussions on the budget and taxes continue with key leaders.
The so-called “fiscal cliff” includes across-the-board budget cuts to defense and domestic spending referred to as the “sequestration,” as well as the expiration of a number of other tax cuts and tax breaks. Among the cuts set to expire are those on income tax implemented under President George W. Bush in 2001 and 2003, and the expiration of the cut in the Social Security/Medicare tax commonly referred to as the payroll tax, which is paid by every wage earner on the first $110,000 of wages. The payroll tax rate dropped to 4.2 percent due to recent legislation, but will return to 6.2 percent unless Congress intervenes.
Other expiring tax cut provisions include those inserted by President Obama as part of the stimulus package, including more generous tax credits for having children, more generous earned income tax credits and credits to help cover the cost of a college education. In addition the alternative minimum tax (AMT) patch, which gets an annual extension rather than a permanent fix, is also set to expire at the end of the year. Without a renewal or extension of this patch, many middle-income families will pay higher taxes.
Also expiring are other ongoing tax credits for businesses, the Adoption tax credit, a current patch or continued higher reimbursements to doctors under the Medicare program referred to as the “doc-fix,” and extended unemployment compensation for the long term unemployed.
To help inform the discussion and debate over the significance of the “cliff”, Senate Finance Committee Chair, Senator Max Baucus (D-Montana), asked the Congressional Budget Office (CBO) to once again detail the impact of the expiring set of laws. On Thursday that information was released, and the CBO found that the combination of tax increases and spending cuts would result in an increased unemployment rate to 9.1 percent, up from the current 7.9 percent, and shrinkage in the gross domestic product of 0.5 percent, all in the calendar year of 2013.
If there is an agreement it would almost certainly have to come in two parts. Part one would be a so-called down payment in spending cuts and tax changes to be followed up with more detailed actions on cuts and tax increases in the next Congress.
Two Child Welfare Advocates Leaving Key Committees and Congress
There is expected to be very little change in the leadership within either party’s ranks, but there will be four vacancies to fill on the all-important-to-child-welfare Senate Finance Committee. Both Republicans and Democrats have two vacancies with Sens. Kent Conrad (D-N.D.) and Jeff Bingaman (D-N.M.) both retiring for the Democrats and with Sens. Olympia Snowe (R-Maine) and Senator John Kyle (R-Ariz.) leaving on the minority side. It is not clear whether the ratio of Democrats to Republicans on the committee will stay the same or whether Republicans will lose a seat due to the overall loss of Senate seats.
On the House Ways and Means Committee, also critical to child welfare, potentially three Republican seats will be vacant with the retirements of Geoff Davis (R-Ky.) and Wally Herger (R-Calif.) and potentially the loss of Charles Boustany (R-La.). Democrats will have at least two seats to fill with the loss of two losing Democrat incumbents: Shelly Berkley (D-Nevada) and longtime child welfare advocate Pete Stark (D-Calif.).
Stark lost in California’s new election system, which can force two members from the same party to run against each other. Congressman Stark, first elected 40 years ago, lost to fellow Democrat Eric Swalwell. Stark has been a strong supporter of child welfare reforms. He was the sponsor and co-sponsor of numerous child welfare bills over the years, especially those that attempted to strengthen the child welfare workforce, a $20 million section of the Title IV-B program that is linked to regular caseworker visits and that states are supposed to use those funds to promote workforce development.
Stark has also been a strong defender of the option to place children in foster and adoptive homes headed by gay parents, a practice some states and agencies have attempted to restrict over the years. He was also an important voice for finance reform of the child welfare system.
On the Senate Finance Committee, Sen. Olympia Snowe (R-Maine) is leaving both the Committee and the Senate after announcing her retirement earlier this year. She first entered the Senate as part of the Republican wave of 1994, filling the retirement seat of then-Majority Leader George Mitchell (D-Maine).
Sen. Snowe was a strong advocate on child welfare issues. Having been raised by relatives herself , she became an important supporter of kinship care and was the key Republican co-sponsor along with then-Sen. Hillary Clinton (D-N.Y.) of a kinship bill that eventually found its way into the Fostering Connections to Success Act.
She had also sponsored or co-sponsored longtime legislation to better address the problem of substance abuse within the child welfare arena. Limited funding of $20 million for that is now part of Title IV-B funding.
New Report Looks at Kinship Care Four Years After Fostering Connections
A new report – Making It Work: Using the Guardianship Assistance Program (GAP) to Close the Permanency Gap for Children in Foster Care – details the impact of expanded use of kinship care, one part of the 2008 Fostering Connections to Success Act (PL 110-351). The 2008 law provides states with the option of using Title IV-E foster care funds to support kinship care placements.
At the time of publication 29 states, the District of Columbia and one Indian tribe had extended Title IV-E funding to include guardianship assistance programs, which allows them to share the cost of kinship-guardian arrangements with the Administration on Children, Youth and Families, which oversees IV-E funding for the Department of Health and Human Services.
It concludes that children with relative guardians are benefiting from the Title IV-E GAPs and provides a snapshot of state activities early in the implementation process so progress can be tracked over time. It is also intended as a valuable resource for agency staff and stakeholders in states that have not yet decided to apply for GAP funds, and for those in states that are currently implementing GAP and want to enhance the reach of the program.
Among the lessons learned by report authors:
-Build support for the importance of permanent families and relatives for children as a way to build support for expanded kinship care.
-Distribute information about kinship care and its benefits to key staff, the courts, state legislators, and relative caregivers.
-Be direct with all involved, including birth parents, and especially caregivers about the limitations of the expanded services.
-Promote licensing so it becomes less of a barrier to placing children with relatives; and look at what other states have done.
The study is based on a survey conducted with state officials and interviews with ACYF,
Click here to read the report.
UPCOMING CAPITOL HILL BRIEFINGS/EVENT
National Foster Care Coalition, Quarterly Meeting, Thursday, December 13, 1:00 to 4:00 PM EST. Location TBA