Overview
Title
To amend part A of title IV of the Social Security Act to establish deadlines for the obligation and expenditure of funds and allow States to establish rainy day funds under the program of block grants to States for temporary assistance for needy families.
ELI5 AI
The bill wants to make sure states use or save the money they get to help needy families by certain times. It also lets them save some of the money for rainy days, but they have to follow rules to do it right.
Summary AI
The bill, H. R. 7410, aims to amend part A of title IV of the Social Security Act to set deadlines for how states should use and allocate funds received for the Temporary Assistance for Needy Families (TANF) program. It requires states to obligate these funds by the end of the following fiscal year and spend them by the end of the second following fiscal year, although a state may reserve up to 15% of the funds for future use, given certain conditions are met. The bill also reauthorizes the TANF program for two more years until September 30, 2026, ensuring continued support for families in need.
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AnalysisAI
The legislation, H. R. 7410, introduced in the 118th Congress, aims to address funding timelines and provide flexibility for states within the framework of the Temporary Assistance for Needy Families (TANF) program, which falls under part A of title IV of the Social Security Act. The bill sets specific deadlines for the use of funds and allows states to reserve a portion of these funds for future needs, essentially creating a "rainy day" fund. Furthermore, it reauthorizes the TANF program for an additional two years through September 30, 2026.
General Summary of the Bill
H. R. 7410 seeks to update the existing TANF program by implementing clear deadlines for states to obligate and spend these federal funds. Specifically, it requires states to obligate the funds by the end of the fiscal year following their receipt and to expend them by the end of the second fiscal year after receiving them. Additionally, the bill permits states to reserve up to 15% of their funds for future use, provided this reserve does not exceed 50% of the funds received the prior year. The legislation also extends funding for TANF activities through fiscal year 2026, appropriating necessary funds from the U.S. Treasury to continue the program at levels consistent with fiscal year 2023.
Significant Issues Identified
Several issues arise in connection with the provisions of this bill:
Fund Reservation Concerns: The option for states to reserve up to 15% of funds could potentially lead to the accumulation of unused funds, delaying aid to families needing immediate assistance.
Budgetary Uncertainty in TANF Reauthorization: The bill's extension of TANF funding without specifying an exact amount and the use of the phrase "such sums as may be necessary" could lead to budgetary uncertainty or insufficient financial oversight.
Lack of Compliance Mechanisms: The absence of explicit penalties for states failing to meet the obligation and expenditure deadlines may reduce incentives for compliance.
Clarity and Administrative Complexity: The requirement for states to notify the federal government of their intention to reserve funds lacks detailed guidance, potentially complicating administrative processes.
Confusion Over Referenced Fiscal Year: Referring to fiscal year 2023 in the context of the 2026 reauthorization might cause confusion if there have been significant policy shifts between those years.
Potential Impact on the Public and Stakeholders
Broad Public Impact: This bill directly affects the delivery of public assistance benefits. By setting clear deadlines, it aims to ensure that states use these funds more efficiently, enhancing the overall responsiveness of the TANF program. However, the reservation provision could delay the distribution of some funds, potentially affecting families who rely on timely financial support.
Stakeholders Impact:
States: The flexibility to reserve funds for future use provides states with the option to prepare for unforeseen financial demands. Yet, it also imposes administrative requirements and adds the responsibility of justified fund reservation planning.
Families and Children in Need: For those dependent on TANF, clarity and timeliness in fund use are crucial. While consistent funding through the extension helps, any delay in fund utilization due to reservations could negatively impact benefitting households.
Federal Government: The oversight responsibility increases, requiring robust mechanisms to monitor state compliance with fund usage deadlines and reserved fund intentions. The lack of detailed guidelines and enforcement mechanisms could pose challenges in achieving financial accountability.
In conclusion, H. R. 7410 strives to create a more structured and flexible financial ecosystem for TANF, balancing the need for timely assistance distribution with the need for states to manage potential future uncertainties. However, this balance comes with challenges regarding transparency, clarity in execution, and ensuring compliance, which the bill will need to address to maximize its effectiveness.
Issues
The provision in Section 2 allowing states to reserve up to 15% of funds for future use could potentially lead to unnecessary accumulation of funds and delay in addressing current needs if not properly justified and monitored, which is significant for accountability and immediate assistance to families in need.
Section 3 appropriates funds without specifying the exact amount required, leading to potential budgetary uncertainty. The phrase 'such sums as may be necessary' is vague and could lead to unregulated or excessive spending, impacting fiscal responsibility.
There is no explicit mention in Section 2 of penalties or actions to be taken if a state fails to obligate or expend funds within the specified deadlines, which could reduce compliance incentives and financial accountability.
Section 2's language in 'subparagraph (B)' regarding the limitation on reserve funds could be clearer to ensure that states fully understand how the 50% limit is calculated, potentially impacting transparency and understanding by state officials responsible for fund management.
In Section 2, the requirement for states to notify the Secretary of their intention to reserve funds might lead to administrative complexities if not accompanied by clear instructions and timelines on how and when such notifications should be made, complicating the administrative processes for state compliance.
The reference in Section 3 to fiscal year 2023 might cause confusion over policy application if there were substantial changes in policies or expenditure amounts between 2023 and the extended period up to 2026, affecting clarity on operational standards.
Sections
Sections are presented as they are annotated in the original legislative text. Any missing headers, numbers, or non-consecutive order is due to the original text.
1. Short title Read Opens in new tab
Summary AI
The first section of the act states that it can be called the “Improve Transparency and Stability for Families and Children Act.”
2. Deadlines for the obligation and expenditure of funds Read Opens in new tab
Summary AI
The bill amends a section of the Social Security Act to set deadlines for states to use federal funds, requiring them to obligate these funds by the end of the following fiscal year and spend them by the end of the second fiscal year after receiving them. However, states are allowed to reserve up to 15% of their funds for future use, as long as the total reserved does not exceed 50% of what they received the previous year, and they must let the Secretary know if they plan to reserve funds.
3. Two-year reauthorization of the Temporary Assistance for Needy Families program Read Opens in new tab
Summary AI
The section extends the funding and activities of the Temporary Assistance for Needy Families (TANF) program until September 30, 2026, maintaining the same authorization as in fiscal year 2023. It also allocates necessary funds from the U.S. Treasury to support this continuation.