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General Guidelines for Using This Template

DEMYSTIFYING SCSEPs FUNDING FUTURE JOHN COLBERT, ESQ. CHP CONSULTING AREAS OF DISCUSSION Funding where are we now? What to expect moving forward? Elections Outlook FY 18 FUNDING The FY 18 Omnibus Appropriations bill was completed on March 23rd.

Five months late and requiring four Continuing Resolutions (CR) FY 18 SCSEP funding = $400 million (level funded) and kept at DOL FY 18 FUNDING HOW DID WE GET HERE? ADMINISTRATIONS FY18 BUDGET REQUEST ELIMINATES SCSEP

$54 billion in total cuts to domestic programs 21% cut to DOL 40% cut to WIOA Elimination of SCSEP CONGRESS IN CHARGE OF BUDGET Good news - both the House and Senate rejected this budget proposal. FY 18 HOUSE FUNDING

$5 billion below FY 17 (3% cut) However, disproportionate cut to Employment and Training Administration (ETA) (18%) SCSEP receives $300 million and transferred to ACL FY 18 SENATE FUNDING - BETTER NEWS $8 billion (5%) above House levels Restores House cuts to most programs: WIOA formula funding level restored SCSEP - $400 million and kept at DOL FY 18 FUNDING AGREEMENT

Six months wait until agreement on topline funding for defense and domestic programs FY 18 FUNDING AGREEMENT Agreement Provides 13% Funding Increase Republicans key priority increased defense funding: $80 billion more in FY 18 $85 billion more in FY19 Democrats key priority increased funding for domestic programs: $63 billion more in FY 18 $68 billion more in FY 19

FY 18 FUNDING Administrations submits amended FY 18 budget request After Congress agrees to increase FY 18 domestic funding, the Administration revised its budget request. Revised request maintained current funding levels for:

WIOA formulas Wagner-Peyser Doubles Apprenticeship request to $200 million Continues to seek elimination of SCSEP FY 18 FUNDING Lesson learned for SCSEP - the Administration will propose elimination of SCSEP in its future budgets regardless of available funding FY 19 FUNDING

FY 19 BUDGET PROPOSAL Administrations initial FY 19 budget request includes same funding cuts for ETA programs as in FY 18 Includes elimination of SCSEP FY 19 BUDGET PROPOSAL After topline budget agreement in Congress --Administration submitted revised FY 19 budget proposal Restores level funding for most ETA programs Maintains elimination of SCSEP Key takeaways on SCSEP funding

Congress in charge of budget and appropriations process FY 18 Administrations budget cuts ignored in FY 18 Unprecedented domestic funding increase approved by Congress Administration continues to support elimination of SCSEP even when more domestic funding is made available Congress chose to maintain support for SCSEP Key takeaways on SCSEP funding Congress in charge of budget and appropriations

process FY 19 Top line funding for FY 19 already in place Slightly more domestic funding available for SCSEP More stability expected in FY 19 for domestic programs Administration unyielding in its desire to eliminate SCSEP What to expect this year? FY 19 appropriations process Hurry up and wait House hopes to complete its appropriations bills before August recess

House Labor-HHS Appropriations hearing held on DOL budget last month SCSEP not on the agenda No expectation that FY 19 appropriations process concludes before November midterm elections What to expect this year? FY 19 appropriations process If Republicans maintain control of House and Senate post midterm elections, no time pressure to complete appropriations bills

If Democrats win control of either House or Senate in midterms, Congress likely to complete FY 19 appropriations process before new Congress begins in January SCSEP funding will be a constant battle throughout the tenure of this Administration support in Congress will determine its fate What to expect this year? Rescission?

House Majority Leader Kevin McCarthy (R-CA) and Administration discussing rescission of the funding in FY 18 Omnibus. Effort unlikely to be successful requires a majority of both House of Congress Democrats will oppose Many Republican appropriators likely to oppose Political strategy playing to base angered by FY 18 spending OTHER WORKFORCE ISSUES TO WATCH IN 2018

Administrations FY 19 budget proposal Workforce funding consolidation proposal Secretaries of Labor and Education, who administer most of the programs, are working on a comprehensive plan to consolidate and reorganize Federal workforce development programs Expected to be released later this year Will require authorizing legislation Major policy reforms difficult in budget proposals, particularly in election years ISSUES TO WATCH: WORKFORCE (APPRENTICESHIPS)

Potential to be bipartisan issue A number of apprenticeship bills introduced House HEA bill includes new apprenticeship program CRYSTAL BALL WORKFORCE (APPRENTICESHIPS) Key Issues Role of Registered Apprenticeships Presidents Executive Order and Task Force creating new pathway for apprenticeships Funding Outlook potential area of consensus but likely next Congress

ISSUES TO WATCH: WORKFORCE (INFRASTRUCTURE) Key issue how to pay for it? Administration - $1.5 trillion federal share $200 billion over ten years; additional funding through state and locals, along with public-private partnerships Democrats want $1 trillion in new federal spending CRYSTAL BALL WORKFORCE (INFRASTRUCTURE)

Parties far apart on how to enact an infrastructure bill. ISSUES TO WATCH: SAFETY-NET (ENTITLEMENT REFORM) Overall focus of House leadership Goal reform programming causing bulk of budget deficit Reduce rate of growth Key components -TANF, SNAP, Medicare, and Medicaid Emphasis on work - able bodied beneficiaries should work in exchange for benefits

CRYSTAL BALL SAFETY-NET Challenge Senate not interested Administration likely to follow Senates lead Difficult to complete major reforms in an election year

Likely to be framed as workforce legislation provide states more flexibility across programmatic lines ISSUES TO WATCH: WORK REQUIREMENTS (MEDICAID WAIVERS) CMS approving state waiver requests requiring work requirements for able bodied recipients. Kentucky, Indiana, and Arkansas waivers approved lawsuit filed

To date, several other state requests pending - each state has different parameters for eligibility ISSUES TO WATCH: WORK REQUIREMENTS (MEDICAID WAIVERS) However, Medicaid funds can only be utilized for health related costs How will the state provide work experience, training, supportive services for Medicaid recipients? CRYSTAL BALL - WORK

REQUIREMENTS Work requirement a trend in red states State interagency planning and funding vital State workforce agencies playing a key role 2018 ELECTIONS Midterms are always a referendum on the party in power. Charlie Cook The presidents party has lost Senate seats in 19 of

26 midterms Lost House seats in 92% of midterms since 1862 PRESIDENTIAL JOB APPROVAL VS. MIDTERM RESULTS SINCE 1966 66% 63% 63%

58% 57% 52% 49% 47% 46% 43%

45% 5 -5 -12 -15 8

-8 42% -13 -26 -47 39% -30

-48 -52 -63 1966 1970 1974

1978 1982 1986 1990 1994 1998

2002 2006 2010 2014 2018 ELECTIONS Today, Democrats have generic lead of 8% - border line wave election

However, Midterms are older, whiter and generally favor Republicans 40% less voters than in Presidential election years MIDTERMS: PRESIDENTS APPROVAL RATING MATTERS Since 1970, when Presidents job approval is below 50% - average number of House seats lost is 33 by incumbent party. Democrats need 23 seats to take control of the House President Trumps approval rating is 42% - lowest since

Truman 4 OF THE LAST 6 MIDTERMS WERE WAVE ELECTIONS HOUSE OF REPRESENTATIVES MIDTERMS: HOUSE OF REPRESENTATIVES Key Congressional Targets for each party 23 Republicans in Clinton-won districts 12 Democrats in Trump-won districts

HOUSE HOW DO DEMOCRATS GAIN 23 SEATS? NO EASY TASK Democrat held seats Republican held seats 4 Lean Republican

;0 Likely Republican ;0 26 21 11 Likely Democrat; 0

2 Likely Democrat Sinema (AZ-9)* Carbajal (CA-24) Crist (FL-13) Loebsack (IA-2) Peterson (MN-7) Kuster (NH-2) Suozzi (NY-3) Maloney (NY-18)

Schrader (OR-5) Cartwright (PA-17) Kind (WI-3) Shea-Porter (NH-1)* Rick Nolan (MN-8)* LoBiondo (NJ-2)* Meehan (PA-7) 5 4 Lean Democrat OHalleran (AZ-1)

McSally (AZ-2)* Bera (CA-7) Royce (CA-39)* Issa (CA-49)* Murphy (FL-7) Ros-Lehtinen (FL-27)* Gottheimer (NJ-5) Kihuen (NV-4) *Incumbent not seeking reelection Source: Cook Political Report.

15 Toss Up Walz (MN-1)* Nolan (MN-8) Rosen (NV-3)* Knight (CA-25) Rohrabacher (CA-48) Coffman (CO-6) Curbelo (FL-26) Blum (IA-1) Roskam (IL-6)

Trott (MI-11)* Lewis (MN-2) Bacon (NE-2) Frelinghuysen (NJ-11) Faso (NY-19) Culberson (TX-7) Comstock (VA-10) Reichert (WA-8)* Denham (CA-10) Paulsen (MN-3) Tenney (NY-22)

Lean Republican Walters (CA-45) Handel (GA-6) Young (IA-3) Bost (IL-12) Jenkins (KS-2)* Yoder (KS-3) Barr (KY-6) Poliquin (ME-2) Bishop (MI-8) Lance (NJ-7) Costello (PA-6)

Fitzpatrick (PA-8) Dent (PA-15)* Vacant (PA-18) Hurd (TX-23) Sessions (TX-32) Love (UT-4) Likely Republican Valadao (CA21) Hunter (CA-50) Mast (FL-18)

Woodall (GA-7) Davis (IL-13) Hultgren (IL14) Walberg (MI-7) Gianforte (MT0) Holding (NC-2) Pittenger (NC9) Budd (NC-13) MacArthur (NJ3) Pearce (NM2)* Zeldin (NY-1)

Donovan (NY11) Katko (NY-24) Chabot (OH-1) Vacant (OH12) Stivers (OH15) Renacci (OH16)* Smucker (PA16) Taylor (VA-2) Garrett (VA-5) Brat (VA-7) McMorris Rodgers (WA5)

Grothman (WI6) MIDTERMS: DEMOCRATIC TAKEOVER IN HOUSE? So far, 35 Republicans are leaving the House, com pared with 17 Democrats. Twenty Republican seats are vulnerable Nine Democratic seats are vulnerable MIDTERMS: DEMOCRATIC TAKEOVER IN HOUSE CONFLICTING TREND LINE HOPE FOR DEMOCRATS

Most retirements from a majority party since 1994 Nine Committee chairs are retiring HOPE FOR REPUBLICANS incumbents run on average 7% ahead in competitive districts Only six House Republican retirements in districts won by Clinton to date. SENATE RACES MIDTERMS: DEMOCRATIC TAKEOVER IN SENATE?

Republicans hold current majority 51-49 26 Democrats up for election, only 8 Republicans However, divisive primaries for Republicans in seven out ten most vulnerable Democratic seats Democrats goal in midterms recapture majority, may prove elusive MIDTERMS: DEMOCRATIC TAKEOVER IN SENATE? Democrats defending seats in 10 states won by the President Five of these states were won by the President by at

least 19% Five of eight Republican seats are considered safe Bitter Irony for Senate Democrats one seat margin, but better chance to regain control of House than Senate MIDTERMS: MOST VULNERABLE SENATORS Democrats toss ups Donnelly (IN) McCaskill (MO) Manchin (WV) Lean Democrat Nelson (FL)

Heitkamp (ND) Brown (OH) Smith (MN) Republicans toss ups Flake (AZ primary) Heller (NV) TN - open MIDTERMS: GERRYMANDERING LIMITS LOSSES IN CONGRESS Major Challenge for House Democrats

Gerrymandering of Congressional districts GERRYMANDERING DOWN TO 72 SWING HOUSE DISTRICTS Democrats 2020 ELECTION: BATTLEFIELD SHIFTS REPUBLICANS DEFENDING MORE SENATE SEATS 2020 12 Democratic seats 21 Republican seats

2022 12 Democratic seats 22 Republican seats ARE PARTIES FOCUSED ON THE RIGHT SET OF ISSUES? Senate Democrats convened a focus group of voters at their retreat earlier this month What the voters kept saying: "Republicans have the wrong agenda; Democrats have no agenda." PARTIES FOCUSING ON WRONG ISSUES

Lowest polling Issues Improving transportation 49 +13 Dealing with drug addiction 49 +13 Reducing budget deficit 48 -4 Dealing with immigration 47 +4 Reducing lobbyist influence 47 +4 Strengthening the military 46 +1 Dealing with climate change 46 +8 Dealing with global trade 38 -2 CRYSTAL BALL MIDTERMS

What to expect Razor thin margins in Congress Still very early control of Senate leans Republican - control of House leans Democrat CRYSTAL BALL MIDTERMS Democrats advantages: History Voter enthusiasm Fundraising challengers outraised 40 Republican

incumbents Republicans advantages: Power total control of both branches of government Limited number of vulnerable districts Campaign infrastructure STATE RACES A LOT ON THE LINE

STATE RACES A LOT ON THE LINE Decennial Census is conducted in 2020 State legislatures redraw congressional and statelegislative lines the following year in all except three states. STATE RACES A LOT ON THE LINE Governors races this year 36 states hold their gubernatorial elections 26 Republican seats 10 Democratic seats (nine Democrats plus one independent)

13 open governorships for GOP, 4 open governorships for Democrats Nine Republican seats competitive, four for Democrats STATE RACES A LOT ON THE LINE State legislatures 82% of state legislative races on the ballot. 26 states GOP control of both chambers. 8 states Democrats control both chambers. 16 legislatures are divided. DEMOCRATIC GOVERNORS

SEATS IN PLAY DEMOCRATS - 10 SEATS LEAN D CO - Hickenlooper PA - Wolf TOSS UP MN - Dayton CT - Malloy AK - Walker(I) LIKELY D OR - Brown


NV - Sandoval LEAN R NH - Sununu OH - Kasich WI Walker LIKELY R AZ - Ducey IA - Reynolds KS - Colyer MA - Baker

TN - Haslam VT - Scott MD - Hogan CRYSTAL BALL STATE ELECTIONS What to expect Outcome of the 2018 state elections will have a dramatic impact on both state and federal politics for the next decade. Republicans currently hold strong majority of Governors and state houses.

However, on the defensive 26 seats up this cycle Nearly half of Republican seats are open CRYSTAL BALL STATE ELECTIONS Challenges for Republicans Clinton won eight seats Republicans are defending Democrats are defending only one state won by President Trump Voter enthusiasm gap Gubernatorial and legislative seats elections this past year have tilted Democrat

QUESTIONS? John Colbert, Esq. CHP Consulting and Capitol Hill Partners

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