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(Associated Press)

(Associated Press)

Informer: ‘Sequestration’ refers to withholding of funds

Last Modified: Wednesday, February 20, 2013 11:48 AM

By Andrew Perzo / American Press

Which meaning of “sequestration” is being used when referenced in congressional matters?

“Sequestration” refers to “a process of automatic, largely across-the-board spending reductions under which budgetary resources are permanently canceled to enforce certain budget policy goals,” reads a Congressional Research Service report released at the end of last month.

The sequestering is done by the Treasury, which holds on to the money rather than forwarding it to the agencies that received appropriations.

The forced cuts will amount to about $85 billion — including, the Congressional Budget Office says, reductions of 8 percent and up to 6 percent in defense and domestic spending over seven months.

“The size of those automatic reductions will be determined by the Office of Management and Budget, which has not yet indicated what they will be,” reads a CBO report released earlier this month.

“Most large nondefense programs (including, for example, Social Security, Medicaid, unemployment compensation, and veterans’ benefits) are exempted from those cuts, and the reduction in Medicare is limited to 2 percent.”

A brief history of sequestration, from the Congressional Research Service report, titled “Budget ‘Sequestration’ and Selected Program Exemptions and Special Rules”:

It was first established by the Balanced Budget and Emergency Deficit Control Act of 1985 ... to enforce deficit targets.

In the 1990s, sequestration was used to enforce statutory limits on discretionary spending and a pay-as-you-go (PAYGO) requirement on direct spending and revenue legislation. After effectively expiring in 2002, sequestration was reestablished by the Statutory Pay-As-You-Go Act of 2010 ... to enforce a modified PAYGO requirement on direct spending and revenue legislation.

Most recently, under the Budget Control Act of 2011 ..., sequestration was tied to enforcement of new statutory limits on discretionary spending and achievement of the budget goal established for the Joint Select Committee on Deficit Reduction.

A sequestration was triggered by the Joint Committee’s failure to achieve its goal and was originally scheduled to occur on January 2, 2013, to affect spending for FY2013. However, legislation was enacted on January 2 that delayed this sequester until March 1, 2013.

The White House, in a Feb. 8 news release, listed several consequences of sequestration.

Among them:

Officials would be forced to eliminate Head Start and Early Head Start services for about 70,000 children.

The Small Business Administration would cut loan guarantees by as much as $902 million.

The Food and Drug Administration would perform 2,100 fewer inspections at foreign and domestic plants.

The Food Safety and Inspection Service, part of the U.S. Department of Agriculture, might have to furlough its entire workforce for two weeks.

Indian tribes would lose nearly $130 million in Interior Department funding.

Rental assistance to 125,00 families would cease.

The Justice Department would prosecute 1,000 or so fewer criminal cases nationwide.

Online: www.fas.org/sgp/crs/misc/R42050.pdf.

• • •

The Informer answers questions from readers each Sunday, Monday and Wednesday. It is researched and written by Andrew Perzo, an American Press staff writer. To ask a question, call 494-4098, press 5 and leave voice mail, or email informer@americanpress.com

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