HB 249 — Federal Funds Modifications

249 Enrolled Copy (vii) how and when challenges should be made to a federal law or regulation on the basis of federalism;

(b) coordinate with and make recommendations to the institute regarding the institute's federalism-federalism-related related duties under Section 53H-4-704;

- 98 - HB0249Enrolled comparedCopy withH.B. HB0249S01 (a) determining the extent of federal jurisdiction in the agency's resource sphere;

249 (a) determining the extent of federal jurisdiction in the agency's resource sphere;

{Section 4.

Section 63J-5-102 is amended to read:

} 63J-5-102.

Definitions.

(1) As used in this chapter:

(a) (i) "Agency" means a department, division, committee, commission, council, court, or other administrative subunit of the state.

(ii) "Agency" includes:

(A) executive branch entities;

(B) judicial branch entities;

and (C) the State Board of Education.

(iii) "Agency" does not mean higher education institutions or political subdivisions.

(b) "Contingency disclosure and plan" means, with respect to a federal funds reauthorization or new federal funds request, the submitting or requesting agency's:

(i) disclosure of:

(A) the likelihood that the amount or value of the federal funds will be reduced, and how that likelihood changes over time;

and (B) the likelihood that the federal funds will become unavailable, and how that likelihood changes over time;

(ii) explanation of:

(A) whether accepting the federal funds may create an expectation of ongoing funding by any beneficiary of the funds;

and - 10 - HB0249 compared with HB0249S01 (B) as applicable, how the agency will communicate to stakeholders that services funded by the federal funds may or will be temporary;

(iii) plan for how the agency will:

(A) proceed if the amount or value of the federal funds are unexpectedly reduced in any material degree or amount;

(B) proceed if the federal funds become unavailable unexpectedly;

(C) wind down the program or services funded by the federal funds when the federal funds are exhausted;

and (D) transition any beneficiaries of the funds to a different program or service provider if the agency is unable to continue providing the same program or services due to a decrease or loss of federal funds;

and (iv) designation of the federal funds and the program or purpose for which the funds will be used as either:

(A) mandatory under federal or state law;

(B) high priority;

or (C) low priority.

(c) (i) "Federal funds" means cash or other money received from the United States government or from other individuals or entities for or on behalf of the United States and deposited with the state treasurer or any agency of the state.

(ii) "Federal funds" includes federal assistance and federal assistance programs, however described.

(d) "Federal funds reauthorization" means:

(i) the formal submission from an agency to the federal government applying for or seeking reauthorization of federal funds which the state is currently receiving;

(ii) the formal submission from an agency to the federal government applying for or seeking reauthorization to participate in a federal program in which the state is currently participating that will result in federal funds being transferred to an agency;

or (iii) that period after the first year of a previously authorized and awarded grant or funding award, during which federal funds are disbursed or are scheduled to be disbursed after the first year because the term of the grant or financial award extends for more than one year.

(e) - 11 - HB0249 compared with HB0249S01 (i) "Federal funds request summary" means a document detailing:

(A) the amount of money that is being requested or is available to be received by the state from the federal government for each federal funds reauthorization or new federal funds request;

(B) those federal funds reauthorizations and new federal funds requests that are included as part of the agency's proposed budget for the fiscal year, and the amount of those requests;

(C) the amount of new state money, if any, that will be required to receive the federal funds or participate in the federal program;

(D) the number of additional permanent full-time employees, additional permanent part-time employees, or combination of additional permanent full-time employees and additional permanent part-time employees, if any, that the state estimates are needed in order to receive the federal funds or participate in the federal program;

(E) any requirements that the state must meet as a condition for receiving the federal funds or participating in the federal program;

and (F) for each federal funds reauthorization for qualifying federal funds and each new federal funds request for qualifying federal funds, a contingency disclosure and plan, and a state jurisdiction evaluation.

(ii) "Federal funds request summary" includes, if available:

(A) the letter awarding an agency a grant of federal funds or other official documentation awarding an agency a grant of federal funds;

and (B) a document detailing federal maintenance of effort requirements.

(f) "Federal maintenance of effort requirements" means any matching, level of effort, or earmarking requirements, as defined in Office of Management and Budget requirements, that are imposed on an agency as a condition of receiving federal funds.

(g) "Federalism Commission" means the Federalism Commission created in Section 63C-4a-302.

[(g)] (h) (i) "Intergovernmental transfer program" means an existing reimbursement program or category that is authorized by the Medicaid state plan or waiver authority for intergovernmental transfers.

(ii) "Intergovernmental transfer program" does not include the addition of a provider to an existing intergovernmental transfer program.

[(h)] (i) "Local education agency" or "LEA" means:

(i) a school district;

- 12 - HB0249 compared with HB0249S01 (ii) a charter school;

or (iii) the Utah Schools for the Deaf and the Blind.

[(i)] (j) "New federal funds" means:

(i) federal assistance or other federal funds that are available from the federal government that:

(A) the state is not currently receiving;

or (B) exceed the federal funds amount most recently approved by the Legislature by more than 25% for a federal grant or program in which the state is currently participating;

(ii) a federal assistance program or other federal program in which the state is not currently participating;

or (iii) a one-time TANF request.

[(j)] (k) "New federal funds request" means:

(i) the formal submission from an agency to the federal government:

(A) applying for or otherwise seeking to obtain new federal funds;

or (B) applying for or seeking to participate in a new federal program that will result in federal funds being transferred to an agency;

or (ii) a one-time TANF request.

[(k)] (l) (i) "New state money" means money, whether specifically appropriated by the Legislature or not, that the federal government requires Utah to expend as a condition for receiving the federal funds or participating in the federal program.

(ii) "New state money" includes money expended to meet federal maintenance of effort requirements.

[(l)] (m) "One-time TANF request" means a proposed expenditure by the Department of Workforce Services from its reserves of federal Temporary Assistance for Needy Families funds:

(i) for a project or program that will last for a fixed amount of time and is not an ongoing project or program of the Department of Workforce Services;

and (ii) that is greater than $1,000,000 over the amount most recently approved by the Legislature.

[(m)] (n) "Qualifying federal funds" means federal funds that are:

(i) greater than 10% of the receiving entity's annual budget;

or (ii) greater than $2,000,000.

[(n)] (o) "State" means the state of Utah and all of its agencies, and any administrative subunits of those agencies.

- 13 - HB0249 compared with HB0249S01 [(o)] (p) "State jurisdiction evaluation" means:

(i) a disclosure of:

(A) whether accepting the federal funds or participating in the federal program will require the use of state funds or increase the administrative costs of the state or agency;

(B) the extent to which accepting the federal funds or participating in the federal program will impair or impact the exclusive police power jurisdiction of the state to protect or provide for the health, safety, welfare, and morals of the state;

and (C) the extent to which accepting the federal funds or participating in the federal program will impair or impact the jurisdiction of the state over federal areas within the state;

and (ii) to the extent that accepting the federal funds or participating in the federal program will impair or impact the state's jurisdiction as described in Subsection [(1)(o)(i)(B)] (1)(p)(i)(B) or (C), an identification of the constitutional authority supporting federal assertion of jurisdiction or authority for the funding, program, or an associated regulation or restriction.

(2) When this chapter describes an employee as a "permanent full-time employee" or a "permanent part- time employee," it is not intended to, and may not be construed to, affect the employee's status as an at-will employee.

{Section 5.

Section 63J-5-201 is amended to read:

} 63J-5-201.

Legislative appropriation subcommittees to review certain federal funds reauthorizations -- Executive appropriations review -- Legislative approval.

(1) The Governor's Office of Planning and Budget shall annually prepare and submit a federal funds request summary for each agency to the Legislative Fiscal Analyst at the same time the governor submits the confidential draft budget under Section 63J-1-201.

(2) (a) The Legislative Fiscal Analyst, as directed by the Executive Appropriations Committee, may include federal funds in the base budget appropriations act or acts, when those acts are prepared as provided in JR3-2-402.

(b) The Legislative Fiscal Analyst shall submit a federal funds request summary for each agency to:

(i) the legislative appropriations subcommittee responsible for that agency's budget for review during each annual general session[.] ;

and (ii) the Federalism Commission.

- 14 - HB0249 compared with HB0249S01 (3) Each legislative appropriations subcommittee shall review [the] each federal funds request summary and may:

(a) recommend that the agency accept the federal funds or participate in the federal program for the fiscal year under consideration;

or (b) recommend that the agency not accept the federal funds or not participate in the federal program for the fiscal year under consideration.

(4) The [Legislative ]Executive Appropriations Committee shall:

(a) review each subcommittee's recommendation;

(b) determine whether or not the agency should be authorized to accept the federal funds or participate in the federal program;

and (c) direct the Legislative Fiscal Analyst to include or exclude those federal funds and federal programs in an annual appropriations act for approval by the Legislature.

(5) Legislative approval of an appropriations act containing federal funds constitutes legislative approval of the federal grants or awards associated with the federal funds for the purposes of compliance with the requirements of this chapter.

{Section 6.

Section 63J-5-202 is amended to read:

} 63J-5-202.

Governor to approve certain new federal funds requests.

(1) (a) Before obligating the state to accept or receive new federal funds or to participate in a new federal program, and no later than three months after submitting a new federal funds request, and, where possible, before formally submitting the new federal funds request, an executive branch agency shall submit a federal funds request summary to the governor or the governor's designee for approval or rejection when:

(i) the state will receive total payments of $1,000,000 or less per year if the new federal funds request is approved;

(ii) receipt of the new federal funds will require no additional permanent full-time employees, permanent part-time employees, or combination of additional permanent full-time employees and permanent part-time employees;

and (iii) no new state money will be required to match the new federal funds or to implement the new federal program for which the grant is issued.

- 15 - HB0249 compared with HB0249S01 (b) The Governor's Office of Planning and Budget shall report each new federal funds request that is approved by the governor or the governor's designee and each new federal funds request granted by the federal government to:

(i) the [Legislature's Executive Appropriations Committee] Federalism Commission;

(ii) the Office of the Legislative Fiscal Analyst;

and (iii) the Office of Legislative Research and General Counsel.

(2) The governor or the governor's designee shall approve or reject each new federal funds request submitted under the authority of this section.

(3) (a) If the governor or the governor's designee approves the new federal funds request, the executive branch agency may accept the new federal funds or participate in the new federal program.

(b) If the governor or the governor's designee rejects the new federal funds request, the executive branch agency may not accept the new federal funds or participate in the new federal program.

(4) If an executive branch agency fails to obtain the governor's or the governor's designee's approval under this section, the governor may require the agency to:

(a) withdraw the new federal funds request;

(b) return the federal funds;

(c) withdraw from the federal program;

or (d) any combination of Subsections (4)(a), (4)(b), and (4)(c).

(5) If a letter or other official documentation awarding an agency a grant of federal funds is not available to be included in a federal funds request summary submitted to the Governor's Office of Planning and Budget under this section, the agency shall submit to the Governor's Office of Planning and Budget the letter or other official documentation awarding the agency a grant of federal funds before expending the federal funds granted.

{Section 7.

Section 63J-5-203 is amended to read:

} 63J-5-203.

Judicial council to approve certain new federal funds requests.

(1) (a) Before obligating the state to accept or receive new federal funds or to participate in a new federal program, and no later than three months after submitting a new federal funds request, and, where possible, before formally submitting the new federal funds request, a judicial branch agency shall submit a federal funds request summary to the Judicial Council for its approval or rejection when:

- 16 - HB0249 compared with HB0249S01 (i) the state will receive total payments of $1,000,000 or less per year if the new federal funds request is approved;

(ii) receipt of the new federal funds will require no additional permanent full-time employees, additional permanent part-time employees, or combination of additional permanent full-time employees and permanent part-time employees;

and (iii) no new state money will be required to match the new federal funds or to implement the new federal program for which the grant is issued.

(b) The Judicial Council shall report each new federal funds request that is approved by it and each new federal funds request granted by the federal government to:

(i) the [Legislature's Executive Appropriations Committee] Federalism Commission;

(ii) the Office of the Legislative Fiscal Analyst;

and (iii) the Office of Legislative Research and General Counsel.

(2) The Judicial Council shall approve or reject each new federal funds request submitted to it under the authority of this section.

(3) (a) If the Judicial Council approves the new federal funds request, the judicial branch agency may accept the new federal funds or participate in the new federal program.

(b) If the Judicial Council rejects the new federal funds request, the judicial branch agency may not accept the new federal funds or participate in the new federal program.

(4) If a judicial branch agency fails to obtain the Judicial Council's approval under this section, the Judicial Council may require the agency to:

(a) withdraw the new federal funds request;

(b) return the federal funds;

(c) withdraw from the federal program;

or (d) any combination of Subsections (4)(a), (4)(b), and (4)(c).

(5) If a letter or other official documentation awarding a judicial branch agency a grant of federal funds is not available to be included in a federal funds request summary submitted to the Judicial Council under this section, the judicial branch agency shall submit to the Judicial Council the letter or other official documentation awarding the judicial branch agency a grant of federal funds before expending the federal funds granted.

{Section 8.

Section 63J-5-203.5 is amended to read:

} - 17 - HB0249 compared with HB0249S01 63J-5-203.5.

State Board of Education to approve certain new federal funds requests.

(1) (a) Before obligating the state to accept or receive new federal funds or to participate in a new federal program, and no later than three months after submitting a new federal funds request, and, where possible, before formally submitting the new federal funds request, the State Board of Education shall review a federal funds request summary of the State Board of Education when:

(i) the state will receive total payments of $1,000,000 or less per year if the new federal funds request is approved;

(ii) receipt of the new federal funds will require no additional permanent full-time employees, additional permanent part-time employees, or a combination of additional permanent full-time employees and permanent part-time employees;

and (iii) no new state money will be required to match the new federal funds or to implement the new federal program for which the grant is issued.

(b) The State Board of Education shall approve or reject each new federal funds request reviewed under this section.

(2) The State Board of Education shall report each new federal funds request that is approved by the board and each new federal funds request granted to the board by the federal government to:

(a) the [Legislature's Executive Appropriations Committee] Federalism Commission;

(b) the Office of the Legislative Fiscal Analyst;

and (c) the Office of Legislative Research and General Counsel.

(3) If a letter or other official documentation awarding the State Board of Education a grant of federal funds is not available to be included in the federal funds request summary submitted under this section, the letter or other official documentation awarding the State Board of Education a grant of federal funds shall be submitted to the State Board of Education before expending the federal funds granted.

{Section 9.

Section 63J-5-204 is amended to read:

} 63J-5-204.

Legislative review and approval of certain federal funds requests.

(1) As used in this section:

(a) "High impact federal funds request" means a new federal funds request that will or could:

(i) result in the state receiving total payments of $10,000,000 or more per year from the federal government;

- 18 - HB0249 compared with HB0249S01 (ii) require the state to add 11 or more permanent full-time employees, 11 or more permanent part-time employees, or combination of permanent full-time and permanent part-time employees equal to 11 or more in order to receive the new federal funds or participate in the new federal program;

or (iii) require the state to expend more than $1,000,000 of new state money in a fiscal year in order to receive or administer the new federal funds or participate in the new federal program.

(b) "Medium impact federal funds request" means a new federal funds request that will or could:

(i) result in the state receiving total payments of more than $1,000,000 but less than $10,000,000 per year from the federal government;

(ii) require the state to add more than zero but less than 11 permanent full-time employees, more than zero but less than 11 permanent part-time employees, or a combination of permanent full-time employees and permanent part-time employees equal to more than zero but less than 11 in order to receive or administer the new federal funds or participate in the new federal program;

or (iii) require the state to expend $1 to $1,000,000 of new state money in a fiscal year in order to receive or administer the new federal funds or participate in the new federal program.

(2) (a) (i) Before obligating the state to accept or receive new federal funds or to participate in a new federal program under a medium impact federal funds request that was not authorized during a legislative session as provided in Section 63J-5-201, an agency shall:

(A) submit the federal funds request summary to the governor, the Judicial Council, or the State Board of Education, as appropriate, for approval or rejection;

and (B) if the governor, the Judicial Council, or the State Board of Education approves the new federal funds request, submit the federal funds request summary to the [Legislative Executive Appropriations Committee] Federalism Commission for its review [and recommendations] in accordance with Subsections (2)(b) and (c).

(ii) The procedures required under Subsection (2)(a)(i) shall be performed, if possible, before the date that the medium impact funds request is formally submitted, but not later than three months after the date of formal submission.

(b) Upon receipt of a federal funds request summary, the Federalism Commission shall:

(i) review the federal funds request summary in accordance with Subsection (2)(c);

and (ii) - 19 - HB0249 compared with HB0249S01 (A) recommend that the agency accept the new federal funds;

or (B) refer the federal funds request summary to the Executive Appropriations Committee for further review as provided in Subsection (2)(c).

(c) When the Federalism Commission reviews a federal funds request summary, the Federalism Commission shall:

(i) consider:

(A) the duration and reliability of the federal funds;

(B) state budget dependence, including the risk of reliance on the federal funds for essential services;

(C) the impact if the amount or value of the federal funds were reduced, including the ability to fund, scale down, or terminate each funded program;

(D) the federal funds' effect on the state's autonomy, including conditions tied to the federal funds and constraints on state policy choices;

and (E) consistency with long-term state goals;

and (ii) based on the Federalism Commission's evaluation of the items described in Subsection (2)(c)(i), determine whether the agency's designation under Subsection 63J-5-102(1)(b)(iv) is the appropriate designation and, if not, which designation described in Subsection 63J-5-102(1)(b)(iv) is the appropriate designation.

[(b)] (d) [The Legislative] If the Federalism Commission refers a federal funds request summary to the Executive Appropriations Committee under Subsection (2)(b)(ii)(B), the Executive Appropriations Committee shall:

(i) review the federal funds request summary and [may:] the results of the Federalism Commission's review under Subsection (2)(c);

and [(i)] (ii) (A) recommend that the agency accept the new federal funds;

[(ii)] (B) recommend that the agency not accept the new federal funds;

or [(iii)] (C) recommend to the governor that the governor call a special session of the Legislature to review and approve or reject the acceptance of the new federal funds.

(3) (a) - 20 - HB0249 compared with HB0249S01 (i) Before obligating the state to accept or receive new federal funds or to participate in a new federal program under a high impact federal funds request that was not authorized during a legislative session as provided in Section 63J-5-201, an agency shall:

(A) submit the federal funds request summary to the governor, the Judicial Council, or the State Board of Education, [ ]as appropriate, for approval or rejection;

and (B) if the governor, the Judicial Council , or the State Board of Education approves the new federal funds request, submit the federal funds request summary to the Legislature for its approval or rejection in an annual general session or a special session.

(ii) Except as provided in Subsection (3)(a)(iii), the procedures required under Subsection (3)(a) (i) shall be performed, if possible, before the date that the high impact funds request is formally submitted, but not later than three months after the date of formal submission.

(iii) For a high impact federal funds request for the Medical Assistance Program, commonly known as Medicaid, or the Children's Health Insurance Program, the procedures required under Subsection (3)(a)(i) shall be performed, if possible, before the date that the high impact funds request is formally submitted, but not later than the end of the earlier of the next annual general session or special session of the Legislature after the date of formal submission.

(b) (i) If the Legislature approves the new federal funds request, the agency may accept the new federal funds or participate in the new federal program.

(ii) If the Legislature fails to approve the new federal funds request, the agency may not accept the new federal funds or participate in the new federal program.

(4) If an agency fails to comply with the procedures of this section or fails to obtain the Legislature's approval:

(a) the governor, the Judicial Council, or the State Board of Education, as appropriate, may require the agency to withdraw the new federal funds request or refuse or return the new federal funds;

(b) the Legislature may, if federal law allows, opt out or decline to participate in the new federal program or decline to receive the new federal funds;

or (c) the Legislature may reduce the agency's General Fund appropriation in an amount less than, equal to, or greater than the amount of federal funds received by the agency.

(5) If a letter or other official documentation awarding an agency a grant of federal funds is not available to be included in the agency's federal funds request summary to the governor, the Judicial - 21 - HB0249 compared with HB0249S01 Council, or the State Board of Education, as appropriate, under this section, the agency shall submit to the governor, the Judicial Council, or the State Board of Education, as appropriate, the letter or other official documentation awarding the agency a grant of federal funds before expending the federal funds granted.

ITEMTEM 1 To Utah State University - Education and General From Income Tax Fund {500,000} 150,000 From Income Tax Fund, One-time 150,000 Schedule of Programs:

Public Service {650,000} 300,000 The Legislature intends that the Analytics Solutions Center at the Utah State University Jon M.

Effective date.

2-6-26 2:58 PM - 229 -