The Office of Management and Budget issued further guidance to federal departments and agencies on Thursday on implementing sequestration cuts.
In a memo written by federal controller Danny Werfel, OMB directly addresses how agencies should handle spending cuts to core mission areas, funding for agency inspector generals, discretionary monetary awards and how to reduce the burden on state, local and tribal governments.
“The Administration continues to urge Congress to take action to eliminate the Joint Committee sequestration and restore cancelled budgetary resources as part of a balanced agreement on deficit reduction,” Werfel wrote. “However, until Congress takes such action, executive departments and agencies … must continue to implement the reductions required by sequestration.”
Appropriate use of existing reprogramming and transfer authority
The memo states that all non-exempt budget accounts in a given spending category must be reduced by a uniform percentage, and the same percentage reduction must be applied to all programs, projects and activities within a budget account. However, depending on an agency’s account structure and any existing flexibilities provided by law, some agencies may have a limited ability to realign funds to protect mission priorities. In doing so, Werfel said agencies should “use any available flexibility to reduce operational risks and minimize impacts on the agency’s core mission in service of the American people.”
Funding for inspector generals
Funds for agency IGs from non-exempt accounts are subject to sequestration. Werfel said the head of each has agency has the final responsibility for implementing reductions required by sequestrations, but IGs have the final responsibility for determining how their authorized budgets will be allocated.
Discretionary monetary awards
Under sequestration, discretionary monetary awards should not be given unless legally required. That includes annual performance awards, group awards and special cash awards. Agencies should not issue these awards until further notice.
Reducing the burden for state, local and tribal governments
Federal agencies should help their state and local partners reduce the effects of sequestration by reducing administrative burdens or other standard administrative processes where possible. “In doing so, agencies should consult closely with their State, local, and tribal partners to determine whether such steps enable public funds to be used in a more cost-effective manner,” the memo says.
