The testimony that the Director of Flight Standards Service presented to congress in June mentions several reasons that the photos are not yet on certificates - lack of funding wasn't mentioned:
http://testimony.ost.dot.gov/test/allen1.htm
The testimony implies funding will come from pilots, so the lack of congressional funding does not appear to be a valid argument, but rather development of standards for additional biometric data that is to be on the cards per the 2012 reform act has held things up:
"The cost of this transition has not yet been determined, but analysis of the costs and benefits of various alternatives to meet the statutory mandate is underway.
To justify imposing a new cost on pilots, we must carefully consider the benefits of improved pilot certificates. If pilot certificates with embedded biometrics are intended to permit airport access or increase security, we must coordinate with the Department of Homeland Security (DHS) and the TSA, which develop standards for airport access and security."
Soon enough we'll be forced to pay for fancy ID cards....