Another Puzzle Piece in Place for VITA Funding

While next year’s budget is far from set, some qualified good news for VITA emerged from recent U.S. Senate discussions.

Federal VITA grant funding shouldn’t fall below its current level of $12 million, according to the Senate Appropriations Committee’s “mark-up” for financial services and general government dollars in Fiscal Year 2013.

“The Committee recognizes that the applications for these grants far exceed the available resources,” the panel’s report acknowledges. Moreover, programs’ state and local resources have been slashed even as the number of grantees dividing the federal grant grows – further constricting support for free tax preparation services for low- and middle-income, working families. 

Yet, as we’ve noted before, in Washington’s tough fiscal atmosphere, achieving even level funding is no small feat.

It’s important to note this news from the Senate carries significant caveats:

• A Congressional mark-up involves early funding targets, and can change considerably by the time an actual budget is adopted by both chambers.
• Even a final budget’s funding levels might not really be “final,” as they face further, significant cuts in the coming year unless Congress takes action otherwise. Current deficit-reduction measures call for across-the-board cuts in many areas of the budget starting next January – reductions that could cost many programs about 8.4 percent of their funding.

So, what’s next?

The U.S. House Appropriations Committee will address its own mark-up on Wednesday; early indications point to a similar, level-funding recommendation for VITA in that chamber, which would remain positive news.

FY13 begins in October. But if recent years are any indication, an agreed budget might not come until weeks or months into the new fiscal year – with November elections and hyperpartisanship complicating things even further.

Finally, many funding decisions will be wrapped-up in decisions on a series of matters that need attention by New Year’s or very shortly thereafter, ranging from tax cuts and refundable tax-credit improvements to the deficit-reduction cuts.

As always, stay tuned for updates on these and other federal actions that have an impact on the financial security of struggling households throughout the nation.

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