The Federal Budget, Sequestration, and What You Should Know

Oct 10, 2012

Sequestration is a quintessential "inside the Beltway" term with huge potential to affect people who live far beyond the Beltway - and inside it, as well.  Here is a primer from CLASP describing what sequestration is and what it means.

What is sequestration? - Sequestration represents automatic, across-the-board spending cuts to the federal budget, totaling approximately $110 billion that will go into effect January 2013.  Sequestration was a part of the Budget Control Act, signed into law in August 2011 by the Obama Administration and negotiated by both sides of the aisle in Congress. The Budget Control Act calls for $1.2 trillion in automatic spending cuts over the next decade, divided equally between defense and "non-defense discretionary" programs -the term used to refer to spending on a wide range of domestic programs including education, health, human services, and labor. The deal was struck to end last summer's debt ceiling showdown and included budget cuts so harsh that it would compel policy leaders to develop comprehensive approaches to address the nation's long-term fiscal health.

No deal in sight - With so much preoccupation with the upcoming elections and the failed efforts of the bi-partisan "supercommittee" - these cuts seem imminent.

What federal programs will be impacted?  - Discretionary programs that are subject to the annual Congressional appropriations process would experience automatic cuts under the sequester - impacting programs from education to justice, such as the community services block grant, job training programs, and federal work study.  Mandatory programs -- those entitlement programs not subject to annual appropriations, including Medicaid,  the State Children's Health Insurance Program (SCHIP), Social Security, TANF, SNAP (or food stamps), and the Child Nutrition programs -- are generally exempt from sequestration.

Who Will Feel These Cuts?  If Congress Fails to Take Action:

  • 1.6 million fewer adults, dislocated workers and at-risk youth would receive job training, education and employment services. In particular, 367,776 fewer low-income youth and adults will be served through the Workforce Investment Act (WIA). At a time when just 20 percent of African American and Latino youth are employed (with the balance of these youth being in school or having simply given up their pursuit of employment in a very challenging labor market) these cuts will have a grave effect.
  • 80,000 fewer low-income children would receive child care subsidies through theChild Care and Development Block Grant (CCDBG). CCDBG provides subsidies to low-income working families to help pay for child care and improve the quality of States' child care programs. This year, approximately 1.5 million children and their working families will receive child care subsidies, representing only 18 percent of those eligible.
  • 145,180 fewer students would be served by21stCentury Community Schools. The 21st Century Community Learning Centers program provides funding to local communities to establish expanded learning opportunities for students, through before- and after-school programs, summer school, and extended school year programs.
  • 1.8 Million Fewer students served through Title I Grants to Local Educational Agencies. Title I is the cornerstone Federal program for helping all students, especially those from disadvantaged backgrounds, meet high academic standards. More than 90 percent of the nation's local educational agencies (LEAs) receive these funds, which are allocated by a formula based largely on LEA family income levels.
  • 51,577 fewer students will receive aid through the Federal Work Study (FWS). These programs provide funding to colleges and universities to help low- and middle-income undergraduate and graduate students pay for postsecondary education through part-time employment at their college or university, public agency, private company, or nonprofit organization.

These are just some of the consequences if Congress doesn't act. For additional, state-specific information on how these cuts will impact children and families' access to programs, read Senator Harkin's report Under Threat.

Read More CLASP statements on sequestration:

So What Is "Sequestration"? And More Importantly, What Do These Spending Cuts Mean for Hard-Working and Low-Income Families?

 CLASP Statement on OMB Sequestration Report

At Risk: Early Care and Education Funding and Sequestration

Civil Legal Aid in Jeopardy



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