Upward Mobility Act of 2026
- Sponsor
- Sen. Husted, Jon [R-OH]
- Committees
- Finance Committee (primary), Small Business and Entrepreneurship Committee
- Last action
- Jun 3, 2026
Bottom line
The bill aims to empower states to innovate antipoverty strategies by consolidating federal funding and waiving regulations, focusing on employment and reduced dependence while centralizing federal oversight under HHS.
What it actually does
This bill establishes a 5-year pilot program allowing up to 5 states to consolidate federal funding from various antipoverty programs, including SNAP, TANF, Child Care, LIHEAP, WIOA, and housing assistance, into "Upward Mobility Grants." Participating states gain broad waiver authority to design their own benefit structures and service delivery models, subject to certain federal protections and a consistent work requirement, with the explicit goal of improving employment outcomes and reducing dependence on direct assistance.
Proponents argue
Supporters argue this bill provides states with necessary flexibility to tailor antipoverty programs to local needs, reduce administrative burdens, and address "benefit cliffs" that disincentivize work. They contend that consolidating funds and focusing on upward mobility measures will lead to better employment outcomes and long-term self-sufficiency for participants, fostering innovation in poverty reduction.
Opponents contend
Critics might argue that consolidating funds and granting broad waivers could lead to reduced accountability, inconsistent benefit levels across states, and potentially undermine the safety net for vulnerable populations if states reduce overall assistance. Concerns could also be raised about the potential for states to implement overly restrictive work requirements or divert funds from their original purposes without sufficient oversight.
The bill is moderately complex due to its technical language, extensive cross-references to existing law, and detailed provisions on program consolidation and evaluation, requiring careful reading to understand its full scope.
Section 1
Short Title
This section simply names the Act as the "Upward Mobility Act of 2026," providing a common reference for the legislation.
Supporters argue
Supporters argue that a clear, concise short title helps in public discourse and legislative tracking, reflecting the bill's core objective of promoting upward mobility.
Critics contend
No specific opposition is typically raised against short titles, as they are standard legislative practice.
Tradeoffs
None.
Section 2(c)
Establishment of Upward Mobility Pilot Program
This provision establishes a 5-year pilot program, allowing the Secretary of Health and Human Services to permit up to 5 states to carry out "Upward Mobility Grants." These grants consolidate funding from various federal antipoverty programs, enabling states to design and implement their own pilot projects. States can also opt for "limited scope" projects.
Section 2(a)(3) and (d)
Funding Consolidation and Grant Calculation
This defines "covered amounts" to include federal funds from SNAP, TANF, Child Care, LIHEAP, WIOA (dislocated workers), Community Development Block Grants, Section 8 tenant-based assistance, public housing Capital and Operating Funds, and rural housing assistance. These amounts are consolidated into a single Upward Mobility Grant for participating states, calculated based on prior year's funding adjusted by the Personal Consumption Expenditures Price Index.
Section 2(e)(1)-(2)
Broad Waiver Authority with Limitations
Grants the Secretary broad authority to waive statutory or regulatory requirements for participating states related to eligibility, program design, operation, delivery, use, allocation, or distribution of funding for included antipoverty programs. However, this authority explicitly excludes waivers for provisions related to program goals, civil rights, health/safety, labor standards, environmental protection, restrictions on benefits for non-citizens, religious freedom, appropriations restrictions, maintenance of effort, or requirements to distribute funds to sub-state entities.
Section 2(h)
SNAP-Aligned Work Requirement and Program Integrity
Mandates that work requirements similar to those in the Supplemental Nutrition Assistance Program (SNAP) (specifically subsections (d) and (o) of section 6 of the Food and Nutrition Act of 2008) apply to all recipients of direct assistance benefits under a pilot project. The Secretary is required to prescribe regulations to ensure compliance and audit state program integrity measures.
Section 2(j)
Independent Evaluation and Upward Mobility Metrics
Requires each participating state to contract with an independent, third-party evaluator for annual assessments of the pilot project. Evaluations must measure "upward mobility measures," including Marginal Effective Tax Rates (METR) on earned income, participant employment outcomes (earnings, employment rates, full-time employment, job retention), reduction in per-capita direct assistance, elimination/reduction of marriage penalties, and poverty reduction among participants. The evaluations must use rigorous methodologies, including experimental designs.
Section 2(f)(7)
Reinvestment of Fiscal Savings
Requires states to describe how they will utilize fiscal savings resulting from improvements in upward mobility measures. Permitted uses include establishing a state reserve fund for temporary direct assistance during crises, improving program management and integrity, renovating community facilities, building capacity for collaboration with local entities, integrating program operations, and providing work supports for employed individuals not receiving grant assistance.
Section 3(c)
Centralization of Administrative Functions
This provision transfers a portion of administrative functions related to the consolidated antipoverty programs from various covered federal agencies (e.g., USDA, HUD, DOL) to the Administration for Children and Families (ACF) within the Department of Health and Human Services. The Office of Management and Budget determines the specific functions to be transferred.
The definition of "covered amount" explicitly excludes any amount that a State or public housing agency is directed to use to provide funding for an Indian tribe.
Section 2(a)(3)(B)(ii)
Why it matters:This is likely standard legislative practice to clarify the scope of federal programs and respect tribal sovereignty, ensuring that tribal programs are not inadvertently swept into state-level consolidation without explicit consent or separate mechanisms.
Case for: Supporters would argue this preserves the direct federal-tribal relationship and prevents states from unilaterally altering funding or program design for tribal communities, respecting tribal self-determination.
Case against: No specific opposition is typically raised against this type of carve-out, as it aligns with established federal Indian policy.
Estimated impact: Ensures that federal funding for Indian tribes under the listed antipoverty programs remains unaffected by the state pilot projects, preserving existing funding streams and program structures for tribal nations.
States will not receive an adjustment to an Upward Mobility Grant because the State increased the amount of the per-capita direct assistance provided through the grant.
Section 2(k)
Why it matters:This is a technical but critical detail for fiscal incentives, designed to prevent states from artificially inflating their grant amounts by increasing benefits. Its placement might reflect its nature as a specific fiscal guardrail rather than a core program design element.
Case for: Proponents would argue this prevents states from gaming the funding formula, ensuring that grant adjustments are based on external economic factors (PCE Price Index) rather than state-level policy choices to increase benefits, thereby promoting fiscal discipline.
Case against: Critics might argue that this provision could disincentivize states from increasing benefit levels even when needed, potentially limiting their flexibility to respond to rising costs of living or specific community needs within the consolidated framework.
Estimated impact: Directly impacts the financial flexibility of states in managing their Upward Mobility Grants, ensuring that the grant amount is primarily tied to the initial baseline and inflation, not state-driven benefit increases.
Despite the general rule that states in the pilot are ineligible for federal funding outside the grant, these clauses explicitly allow participating states to access specific contingency funds for SNAP, TANF, and LIHEAP during periods of economic downturn, natural disaster, public health emergency, or other unanticipated events.
Section 2(e)(4)(C)-(E)
Why it matters:These are crucial safety valves, ensuring that states participating in the innovative pilot program are not left without recourse during emergencies, which would otherwise be a major disincentive to participation. Their technical nature makes them less prominent.
Case for: Supporters would highlight these provisions as essential safeguards, demonstrating that the bill provides flexibility without abandoning the safety net during crises, making the pilot more attractive and viable for states.
Case against: No specific opposition is typically raised against emergency funding provisions, though some might argue about the sufficiency of the funds or the criteria for activation.
Estimated impact: Provides a critical layer of financial security for participating states and their residents during unforeseen crises, ensuring continuity of essential benefits from these specific programs.