Legislative Update: Update on Sequestration; Republican Flexibility Plan

Update on Sequestration

With the passage of the March 1 deadline, sequestration has been triggered. In a report from the Office of Management and Budget, it is calculated that over the course of the fiscal year “ the sequestration requires a 7.8 percent reduction in non-exempt defense discretionary funding and a 5.0 percent reduction in non-exempt nondefense discretionary funding. The sequestration also requires reductions of 2.0 percent to Medicare, 5.1 percent to other non-exempt nondefense mandatory programs, and 7.9 percent to non-exempt defense mandatory programs.”

Education and workforce programs would fall into the non-exempt nondefense discretionary category and would be subject to the 5% cut. For the U.S. Department of Education this translates into a cut of $2.278 billion.

What does this mean for Perkins?   The entire Perkins allocation would be reduced by 5%, then the federal-to-state formula would be run to determine state allocations. Therefore, the impact of sequestration on your state Perkins allocation is yet to be determined.  While a 5% estimate is something you can work with as an estimate, the annual formula shifts due to population and poverty,  as well as the small state minimum, will impact the allocations among the states.  NASDCTEc  has been in touch with the Office of Vocational & Adult Education (OVAE) regarding when state estimates will be available.  As for Friday afternoon, they do not have a firm answer. The U.S. Department of Education has not yet determined if the reduction will apply to the July 1 allotment and the October 1 allocation or if the reduction will be taken out of one of the two allotments made to the states. NASDCTEc has encouraged OVAE to provide you with the state allocations as soon as possible.

The White House created fact sheets on the general effects of sequestration (http://www.whitehouse.gov/blog/2013/02/22/what-sequester#states).

While these are useful, they do not contain specific information in regard to Perkins funding.  As soon as more details are available, including a conclusive impact on Perkins and each state’s allocation, we will make it available.

If you have any questions, please feel free to contact David Beckett, NASDCTEc’s Advocacy Manager at 301-588-9630 or [email protected].

Republican Flexibility Plan

In recent weeks, many lawmakers, especially on the Republican side have touted the idea of allowing the Federal Government flexibility when it comes to reducing the budget, as an alternative to sequestration. While sequestration sees uniform spending reductions across every non-discretionary program, flexibility would allow each Federal department the ability to cut some programs more than others.

The White House has made it clear they are against this proposal, because it would still see a vast reduction in spending levels in programs like CTE that invest in the future prosperity of the nation. Similarly, the Senate Democrats are opposed to the proposal but yesterday saw their move to replace the sequester with an increase in taxes for households earning over $5m a year fail when they couldn’t garner enough votes. The stalemate means the current Continuing Resolution (CR), which funds the government until March 27, remains in place for now. However, Speaker Boehner (R-OH) today said he would table a new CR in the House next week, which if passed would avert a government shutdown. While details on how this will affect CTE  remain unclear, updates will be posted on the blog as soon as they are available.

David Beckett, Advocacy Manager

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