Public Sector Roundup: Will Sequestration Continue Into Fiscal Year 2014?

Federal employees in many agencies are facing furloughs--or the possibility of furloughs--in fiscal year 2013 due to sequestration. What's ahead in FY 2014?

The good news, such as it is, is that even if the federal spending cuts called for by the 10-year sequestration process included in 2011's Budget Control Act continue into FY 2014, federal agencies this time around will be better prepared. The bad news is that it does not appear likely that Congress and the president will come up with an alternative to sequestration by the Oct. 1, 2013, beginning of the next fiscal year, meaning that federal agency leaders and employees will continue to face budget constraints.

In fact, it would be surprising if the House and Senate were to agree on regular FY 2014 spending bills for most federal agencies rather than passing a continuing resolution to fund the lion's share of government agencies. Already, Rep. Hal Rogers (R-Ky.), chairman of the House Appropriations Committee, appears to be preparing a budget for next year that assumes the continuation of sequestration. His Senate counterpart, Sen. Barbara Mikulski (D-Md.), chairwoman of the Senate Appropriations Committee, is assuming that sequestration will be replaced before the end of FY 2014.

Compared with the current fiscal year, however, federal agencies in FY 2014 will be far more likely to expect and plan for sequestration. As congressional Republicans in particular have pointed out, the White House Office of Management and Budget in a July 2012 memorandum to federal agency heads said "agencies should continue normal spending and operations since more than 5 months remain for Congress to act," with the assumption being that sequestration would not be allowed to take effect as scheduled on Jan. 2, 2013. Although sequestration in the end was postponed until March 1, giving federal agencies even less time to implement the required cuts during the remaining months of FY 2013, agency leaders in the coming fiscal year will know better than to make such an assumption.


In other public sector news:

  •  The National Labor Relations Board ruled that the U.S. Postal Service unlawfully failed to give the National Postal Mail Handlers Union information about the testing of job applicants and ordered USPS to provide the data, but it specified that individual employees' test scores were not to be identified.
  • Illinois teachers, public safety professionals, elected officials, and state employees would pay more out of pocket for their pensions and work longer to qualify for retirement under legislation passed by the state House of Representatives. 

  • Arkansas Gov. Mike Beebe (D) signed into law a pair of measures (H.B. 1901H.B. 1902) that will regulate the access of public and private employers and institutions of higher education to the personal social media accounts of current and prospective employees and students in the state.
  • Texas cities, counties, and school districts that offer health benefits to their employees' domestic partners are violating the state constitution, the state's attorney general said in an opinion provided to a state senator.