Last week, the U.S. House of Representatives narrowly approved the Limit, Save, Grow Act of 2023 (H.R. 2911), the House plan to raise the federal debt limit and limit federal spending. Unless Congress raises the federal debt limit by this summer, the United States could default on its debt, causing a global financial crisis. The bill would extend the debt limit through March 31, 2024 or until it increases by $1.5 trillion, whichever occurs first. This would mean that Congress would need to renegotiate the debt limit within the next year, creating another opportunity for a potential financial crisis.
Several of the spending provisions in the bill could affect nonprofits and the people they serve, including:
1. Language to claw back unappropriated funds from the American Rescue Act Plan and other COVID relief programs; some of these unappropriated funds in Louisiana could still be used by the state and local governments to support the work of nonprofits;
2. A provision prohibiting executive actions to forgive student debt or make changes to income-driven repayment plans;
3. Repeal of a variety of green tax credits that were passed into law last year, some of which benefit nonprofits making energy-efficient upgrades to their facilities; and
4. Provisions extending the work requirements for the Supplemental Nutrition Assistance Program (SNAP) from the current age range of 18-49 to an age range of 18-55 and adding work requirements for Medicaid recipients.
The Limit, Save, Grow Act passed by a 217-215 margin, mostly along party lines; all five Republican House members from Louisiana voted for the bill, and Democratic House member, Congressman Troy Carter, voted against the bill. The Limit, Save, Grow Act is unlikely to become law, since neither the Democrat-controlled Senate nor President Biden support this proposal. Instead, leaders in both chambers in Congress and the White House are likely to continue to negotiate a debt limit extension and federal spending changes in the coming weeks and months.