Upward Mobility Act of 2026
- Bill Number
- S. 3583
- Origin Chamber
- Senate
- Congress
- 119th Congress, Session 2
- Policy Area
- Social Welfare
- Status
- Introduced
- Latest Action
- 2026-06-03: Committee on Small Business and Entrepreneurship. Hearings held.
- Last Updated
- 2026-06-26T20:04:45Z
AI-Generated Summary
Purpose of the Legislation
The Upward Mobility Act of 2026 establishes a five-year pilot program allowing up to five states (including the District of Columbia) to consolidate federal funding from various antipoverty programs into single "Upward Mobility Grants." The goal is to streamline services, reduce "benefit cliffs" (sudden losses of aid when income rises), promote employment and earnings growth, and lower reliance on government assistance while addressing needs like nutrition, housing, child care, energy costs, and temporary family support.
Key Provisions
- Covered Programs and Funding Consolidation:
- States can combine funds from programs including the Supplemental Nutrition Assistance Program (SNAP, for food benefits), Temporary Assistance for Needy Families (TANF, cash aid for low-income families), child care subsidies, Low-Income Home Energy Assistance Program (LIHEAP, utility aid), workforce training for dislocated workers, and certain housing assistance (e.g., public housing and rental subsidies).
- "Covered amounts" include state grants, contracts, or allocations for these programs, excluding funds directed to Native American tribes.
- Grants are calculated based on a state's prior-year funding, adjusted annually for inflation using the Personal Consumption Expenditures Price Index; payments are made quarterly.
- For "limited scope" pilots (e.g., covering only a portion of eligible people, a specific area, or fewer programs), grants can be 10-100% of the full amount.
- Waivers and Flexibility:
- States can request waivers from federal rules on eligibility, program design, operations, and fund use to create integrated services.
- Waivers cannot affect core protections like civil rights, anti-discrimination rules, health/safety standards, labor laws (e.g., minimum wage), environmental rules, citizenship requirements for benefits, religious freedoms, funding limits in budget laws, or requirements to pass funds to local entities.
- Housing funds must continue going to the same local recipients as before.
- During the pilot, states and participants lose access to separate federal funding for these programs (with exceptions for limited-scope pilots and emergency contingency funds for events like economic downturns or disasters).
- State Application Requirements:
- Applications must detail how the pilot will meet antipoverty goals, including benefit designs to limit "marginal effective tax rates" (the portion of extra earnings lost to reduced aid or higher taxes, ideally capped at 50%).
- States must outline eligibility for participants, data privacy/fraud prevention, work requirements (applying SNAP's rules, like 20-30 hours/week of work or training for able-bodied adults), engagement with nonprofits/faith-based groups/local governments for services, and use of savings for improvements like reserves or infrastructure.
- Optional proposals to cut state regulations on basics like child care or housing to lower costs.
- Independent third-party evaluations are required annually, using rigorous methods (e.g., random assignment or statistical comparisons) to measure outcomes like employment rates, earnings, reduced aid dependence, and poverty levels.
- Approval Process:
- The Secretary of Health and Human Services (HHS), via the Assistant Secretary for Children and Families, reviews applications within 90 days, prioritizing designs with low tax rates, strong evaluation methods, and work compliance.
- Public comment period of 30 days; disapprovals can be appealed with modifications.
- Work and Integrity Rules:
- SNAP work requirements apply to aid recipients, with states ensuring enforcement.
- HHS audits program integrity and facilitates data sharing across federal agencies.
- Funding Adjustments and Transfers (Section 3):
- No grant reductions if a state increases per-person aid levels.
- Administrative costs for covered programs transfer to participating states proportionally.
- Oversight functions (e.g., duties from agencies like USDA or HUD) shift to HHS's Administration for Children and Families, with provisions for personnel, budgets, and smooth transitions.
- Existing legal documents, proceedings, and suits continue unaffected.
Significant Changes to Existing Law
- Consolidation and Waivers: Introduces flexibility to blend funds and waive rules across siloed programs (e.g., SNAP, TANF, housing), which are currently administered separately by agencies like USDA, HHS, and HUD—potentially simplifying delivery but requiring HHS centralization.
- Performance Focus: Shifts emphasis from program-specific rules to outcomes like reduced aid dependence and employment gains, with mandatory evaluations using evidence-based methods not previously required at this scale.
- Emergency Exceptions: Allows access to contingency funds (e.g., SNAP reserves) during crises without full program reversion, differing from rigid separate-program rules.
- Administrative Shift: Transfers partial functions and funding oversight to HHS, altering inter-agency roles without changing overall appropriations.
Potential Impacts
- Government Agencies: HHS gains centralized authority over multiple programs, potentially reducing duplication but increasing administrative burden for evaluations and audits. Other agencies (e.g., USDA for SNAP, HUD for housing) lose direct control for pilot states, with possible efficiency gains if pilots succeed in cutting long-term costs.
- Citizens: Low-income individuals and families in pilot states may experience smoother aid transitions, more customized support (e.g., via nonprofits), and incentives to work without steep benefit losses, potentially boosting earnings and self-sufficiency. However, work requirements could limit access for some, and outcomes depend on state designs. Non-participants remain under existing programs.
- International Relations: No direct impacts, as the bill focuses on domestic antipoverty efforts.
Main Stakeholders Affected
- States and Local Governments: Up to five states lead pilots; locals (e.g., housing agencies, community groups) must be engaged and continue receiving targeted funds.
- Low-Income Individuals and Families: Primary beneficiaries or participants, especially those in covered programs, facing changes in aid delivery and work rules.
- Nonprofits, Faith-Based, and Private Providers: Involved in service delivery, case management, and potential regulatory relief.
- Federal Agencies: HHS oversees; USDA, Department of Labor, and HUD adapt to transfers and waivers.
- Evaluators and Researchers: Third-party contractors conduct mandatory assessments.
Notable Legal, Constitutional, or Political Implications
- Legal: Waivers preserve essential safeguards (e.g., anti-discrimination, safety), minimizing challenges under laws like the Fair Labor Standards Act. Savings provisions ensure continuity of existing rights and proceedings, reducing disruption risks. Program integrity rules and audits aim to prevent fraud, aligning with federal accountability standards.
- Constitutional: As a voluntary pilot, it respects federalism by empowering states without mandating participation, but fund transfers could raise questions on executive reorganization authority (mitigated by Office of Management and Budget involvement).
- Political: Promotes welfare reform themes like work incentives and reduced dependence, potentially influencing broader debates on poverty policy. Success could expand the model; failures might highlight risks of flexibility in safety-net programs. Neutral evaluations provide data for future evidence-based adjustments.
This summary was generated by AI and may contain inaccuracies. Refer to the official source document for the authoritative text.
Sponsor
Cosponsors (2)
Sen. Sheehy, Tim [R-MT], Sen. Ernst, Joni [R-IA]
Recent Actions
- 2026-06-03: Committee on Small Business and Entrepreneurship. Hearings held.
- 2026-01-06: Read twice and referred to the Committee on Finance.
- 2026-01-06: Introduced in Senate
Bill Versions
- Upward Mobility Act of 2026 — issued 2026-01-06 — PDF (43 pages)