For States, Debt Deal is Short on Details

As state officials begin to decipher Washington’s spending reduction deal, it’s clear that federal aid to states for certain programs will take a hit over the next decade. But it will be a while before they know exactly which programs and how big a hit.

That’s because the deal, which the U.S. House passed Monday night (August 1), leaves a lot of choices hanging into the future. It calls for $917 billion in deficit reduction over 10 years by setting caps on discretionary spending. But exactly how to meet those caps — and what funds to states might be cut — is a question for Washington to answer another day. Also undetermined is how much a joint congressional committee charged with finding another $1.5 trillion in deficit savings would cut from aid to states.