H.R. 7507

119 HR 7507 IH: Fiscal Harms of Federal Firings Act
 U.S. House of Representatives
 2026-02-11
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 I  119th CONGRESS  2d Session  H. R. 7507  IN THE HOUSE OF REPRESENTATIVES   February 11, 2026   Mrs. McClain Delaney  (for herself,  Mr. Subramanyam ,  Ms. Norton ,  Mr. Olszewski ,  Mr. Walkinshaw ,  Ms. Elfreth ,  Mr. Ivey ,  Mr. Moulton ,  Mr. Vindman , and  Mr. Lynch ) introduced the following bill; which was referred to the  Committee on Oversight and Government Reform    A BILL
To require the Comptroller General of the United States to conduct a study of the impact of Federal reductions in force on State and local governments, and for other purposes.
1.
Short title
This Act may be cited as the   Fiscal Harms of Federal Firings Act  .
2.
Findings
Congress finds the following:
(1)
Federal Reductions in Force (RIFs) may displace workers, altering where affected individuals live and work across States and localities.
(2)
Such workforce reductions may increase demand for State-administered services, including unemployment insurance, medicaid, workforce retraining, housing assistance, and other social services.
(3)
RIFs may reduce economic activity and tax revenues in regions with a high concentration of Federal employment.
(4)
States and local governments vary significantly in their fiscal capacity to absorb the short- and long-term impacts of large-scale Federal workforce reductions.
(5)
There is currently no comprehensive Federal assessment of how RIFs affect State and local government budgets, revenues, and expenditures.
3.
Study of the impact of Federal reductions in force on State and local government budgets
(a)
In general
The Comptroller General of the United States shall conduct a comprehensive study on the impacts of RIFs on the budgets of States and local governments.
(b)
Scope of study
The study shall examine, at a minimum—
(1)
changes in State or local government expenditures resulting from a RIF related to—
(A)
unemployment insurance;
(B)
Medicaid and other health programs;
(C)
workforce development and retraining; or
(D)
housing and income assistance programs;
(2)
impacts on State and local government tax revenues as a result of a RIF, including income, sales, and property taxes;
(3)
regional economic effects, including employment shifts and impacts on the private-sector;
(4)
administrative and operational challenges faced by States and local governments responding to RIFs;
(5)
differences in impacts on States and local governments based on—
(A)
size and scale of the RIF;
(B)
geographic concentration of Federal employees; and
(C)
State and local government fiscal capacity and labor market conditions;
(6)
historical case studies of significant RIFs on States or local governments occurring within the previous 20 years; and
(7)
strategies used by States and local governments to mitigate fiscal and economic impacts.
(c)
Consultation and data collection
(1)
Consultation
In conducting the study, the Comptroller General shall seek to consult with—
(A)
State and local government budget officers and governors offices;
(B)
State and local government workforce and labor agencies;
(C)
relevant Federal agencies, including the Office of Personnel Management and the Department of Labor; and
(D)
economists, labor market experts, and public finance researchers.
(2)
Data sources
The study may use administrative data, surveys, economic modeling, and publicly available fiscal and labor statistics.
(d)
GAO reports to Congress
(1)
Deadline
Not later than 18 months after the date of the enactment of this Act, the Comptroller General shall submit a report on the study to—
(A)
the Committee on Education and Workforce of the House of Representatives;
(B)
the Committee on Health, Education, Labor, and Pensions of the Senate;
(C)
the Committee on Oversight and Government Reform of the House of Representatives; and
(D)
the Committee on Homeland Security and Governmental Affairs of the Senate.
(2)
Contents
The report under paragraph (1) shall include—
(A)
findings and analysis from the study, including—
(i)
an analysis of whether each RIF studied improved the respective agency’s efficiency; and
(ii)
any recommendations, including any recommendations for statutory or administrative changes to provide support for displaced employees and States and local governments impacted by RIFs;
(B)
identification of States and local governments that experienced the greatest fiscal effects of RIFs;
(C)
projected short-term and long-term budgetary impacts on States and local governments; and
(D)
policy options for Congress to consider, including potential Federal assistance, coordination mechanisms, or advance planning tools.
(3)
Public availability
The Comptroller General shall make the report under paragraph (1) publicly available on the website of the Government Accountability Office.
(e)
Definitions
In this Act—
(1)
the term  reduction in force  or  RIF  means a reduction in force under subchapter I of chapter 35 or section 3595 of title 5, United States Code, or any other significant downsizing of Federal civilian employees; and
(2)
the term  State  means each of the several States, the District of Columbia, and any territory or possession of the United States.