Sponsors (11)
The bill strengthens federal protection of taxpayer funds by forcing rapid repayment and empowering quick recoveries, but that speed risks creating significant short‑term fiscal strain and legal uncertainty for state and local governments.
Taxpayers face lower federal exposure because States must prioritize repayment of federal advances, which reduces the amount of outstanding federal risk if States receive funds that can repay advances.
State governments and taxpayers benefit from a clearer enforcement mechanism that lets the Secretary of Labor recover misused funds quickly, improving accountability and creating a stronger deterrent against improper use.
State and local governments may face immediate cash‑flow pressure and be forced into short‑term borrowing because of the requirement to redirect funds within five business days, increasing administrative and financing costs and potentially disrupting planned programs or services (costs that can flow to taxpayers).
State governments face budgeting uncertainty and a higher likelihood of legal disputes because an adverse Secretary determination triggers an automatic five‑day clawback of the full amount.
Based on analysis of 2 sections of legislative text.
Requires States to apply eligible federal funds to repay outstanding federal advances within 5 business days and empowers the Secretary to require full repayment within 5 business days if funds were diverted.
Official title: To amend title XII of the Social Security Act to require States to first use certain funds to pay outstanding balances on advances made under such title prior to using such funds for any other purpose.
Introduced May 19, 2026 by Vince Fong · Last progress May 19, 2026
Requires States to use any federal funds that can be used to repay earlier federal advances to repay outstanding advances within five business days of the funds becoming available. Gives the Secretary authority to require full repayment to the federal government within five business days if the State used the funds for other purposes before repaying advances; applies to funds awarded on or after enactment.