Biden FY22 Budget Proposal

by Laura Walling, Senior Director of Government Relations, Goodwill Industries International

President Biden released the full version of his Administration’s fiscal year 2022 (FY22) budget, which calls for $6 trillion in spending and a deficit of $1.8 trillion. The proposal provides details for allocations for federal agencies following topline requests that were released as part of the “skinny” budget in early April.

The budget request reflects proposals in the American Jobs Plan and American Families Plan​ and outlines the effects of those plans which are still being negotiated by Congress. It also predicts a recovering economy, with the unemployment rate dropping to 4.1% in 2022 and 3.8% in 2023 and beyond.

Many of the proposals would be paid for via tax changes which would raise net $2.4 trillion over a decade, per the budget details. Of note, charitable nonprofits are pleased that the proposal does not include any restrictions to charitable giving (a concern that was raised early on). The proposal includes increases to the corporate tax rate while making permanent expansions to the earned income tax credit for childless workers and the child and dependent care credit under the 2021 COVID-19 aid package and extends the child tax credit.

The proposal calls for increases across most federal agencies. The Education Department would receive $102.8 billion, a 40.8% increase over FY21. Topline numbers include:

• $36.5 billion for Title I grants for schools with many low-income students, a $20 billion increase ​
• New Equity Grants to address disparities between wealthier and under-resourced schools​
• $27.5 billion for student financial assistance, a $3 billion increase​
• $17.2 billion for special education programs, a $3.1 billion increase​
• $6.5 billion for school improvement programs, a $1.1 billion increase​
• $1 billion for new School-Based Health Professionals grant program​
• $3.3 billion for higher education, a $767.1 million increase​
• $2.2 billion for career, technical, and adult education, a $153 million increase ​
• Increase the maximum Pell Grant by $400 and make DACA (Dreamers) recipients eligible​

For the Department of Labor, the request includes a 14% hike in overall annual appropriations, to $14.2 billion.  That recommended boost would be split between increased resources for workplace enforcement, job training, and investments in unemployment insurance, among other areas.  Across labor agencies, the White House proposed that:

• DOL’s Wage and Hour Division would be allotted $276 million, compared to $246 million in fiscal 2021;
• the National Labor Relations Board would be given $302 million, up from $274 million in the current fiscal year;
• the Occupational Safety and Health Administration would receive $664.6 million million, a rise from $592 million currently;
• the U.S. Equal Employment Opportunity Commission would get $446 million, a jump from $404.5 million;
• the Employee Benefits Security Administration would receive $218 million, compared to $181 million in fiscal 2021;
• the Office of Federal Contract Compliance Programs would get $141 million, up from $106 million; and
• the Office of Labor-Management Standards would receive $52 million, an increase from $44 million in fiscal 2021.

The Employment and Training Administration would also receive an increase along with programs under the Workforce Innovation and Opportunity Act, apprenticeship programs, YouthBuild, the National Youth Employment Program, and a national training program for veterans.  The Senior Community Service Employment Program (SCSEP), which Goodwill Industries International is a grantee, would receive level funding.  While we continue to advocate for an increase in SCSEP funding, previous budget requests called for the elimination of the program.  The continuation of the program in the budget request demonstrates that the administration recognizes the value.

Through the American Jobs Plan, the Administration proposes to invest in proven workforce development programs targeted to underserved groups and getting students on paths to careers before they graduate from high school. The American Jobs Plan includes the following programs:

• Community College Training Partnerships.—Provides $9 billion over ten years for capacity building grants to community colleges, seeding partnerships between community colleges, employers, public workforce system entities, unions, and community-based organizations to build high-quality workforce training programs.
• Comprehensive Supports for Dislocated Workers.—Provides $18 billion over ten years for States to provide comprehensive wraparound services to enable dislocated workers to participate in high-quality training programs that build new skills leading to in-demand jobs.
• Reentry Training Program.—Provides $1 billion over ten years to expand the provision of workforce development services to justice-involved individuals.
• Registered Apprenticeship and Pre-Apprenticeship.—Provides $10 billion over ten years to vastly expand Registered Apprenticeships and the pathways into these proven earn-and-learn programs, creating one to two million new Registered Apprenticeship slots over the next ten years.
• Sectoral Employment through Career Training for Occupational Readiness (SECTOR).—Provides $22 billion over ten years for competitive grants to spur the creation of sector-based training programs that equip millions of workers with the skills they need to fill the high-growth jobs of the future.
• Subsidized Jobs Program.—Provides $4 billion over ten years for subsidized jobs to workers with barriers to employment.
• Support for Phasing out 14(c).—Provides $2 billion over six years for grants to states to transition individuals with disabilities from subminimum wage to competitive integrated employment.

Some Republican lawmakers have already pushed back against a number of these proposals. While the American Jobs Plan and investments in infrastructure are being discussed, the budget and appropriations process will move via a separate track. House Appropriators will take the lead and are expected to mark up bills this month with floor votes anticipated in July. The bills then move to the Senate. The spending bills need to pass by October 1, the start of FY22, otherwise a continuing resolution will be needed to avoid a government shutdown.

We’ll continue to keep our advocates informed of new developments and opportunities where your voice can help us protect critical programs of interest to local Goodwill organizations and the individuals they serve, as we go through the budget and appropriations process.