Wednesday, July 31, 2013

The Ongoing Impacts of the Sequester on Communities

The government-wide spending cuts known as the sequester took effect on March 1, forcing $85 billion in federal budget reductions by the end of September. As we previously described, these cuts, which only affect discretionary programs (i.e. programs for which Congress must annually appropriate dollars) have reduced the budgets of the U.S. Departments of Health and Human Services, Education, Justice and Labor, among others. As the months have progressed we are increasingly seeing how these cuts at the federal level trickle down to impact states and communities, causing multitudes of reductions in services and programming.

A map from the Center for American Progress shows how the sequester is impacting states, including Head Start programs, public schools, housing assistance, tribal programs and programs for seniors. These stories from across the nation reveal just how much states and local governments depend on federal funds to maintain their levels of service. Head Start programs have been forced to develop longer waiting lists, cut children from the program, eliminate or reduce transportation for children to centers, and lay off staff. Some school districts have been forced to sell offices, reduce teacher personal days, lay off teachers and support staff, and eliminate arts, music and physical education programs. The consequence of these moves are larger classroom sizes and a lower quality of education. The sequester is also causing longer waiting lists for housing choice vouchers, and in some places leading to vouchers being taken back and current voucher holders being reverted to a waiting list if they have not yet secured a lease with a landlord.

Funds for tribal programs have also faced extreme cuts, including 21 percent cuts in tribal housing grants; a 23 percent cut to Native job training; and a 35 percent cut to Energy Assistance. The sequester is being felt much heavier in tribal lands because unlike states, tribes cannot levy property taxes on lands held in trust, or gain significant revenues from income taxes, given the chronically low incomes of most residents on Indian reservations. Although the federal government pays about 10 percent of the budget for a typical U.S. public school district; on federal lands, it contributes as much as 60 percent. This can translate to the reduction or elimination of education programs and services, including the elimination of summer school, vocational training for high school youth, and can lead to the inability to fill vacant teacher and support staff positions (such as school guidance counselors and mental health counselors). The effects of cuts for mental health programs in tribal schools can have devastating consequences for tribal communities because research shows that Native American children and youth have disproportionately high rates of depression, substance abuse and suicide.

The across-the-board cuts of the sequester are reducing services for people who immediately need them, but they also have long-term fiscal consequences.  For example, states have had to roll back on the Meals on Wheels program, reducing the number of visits seniors receive, and creating a waiting list for seniors in need of delivered meals.  This is a crucial service that enables seniors to remain in their homes. Not only does the delivery of meals provide nutrition assistance to seniors, but it serves as a check-up and social interaction for those who live by themselves and are sometimes otherwise socially isolated. Cutting these services actually costs taxpayers more money in the long term, because a tax dollar spent providing support services to someone at home can prevent having to spend many more tax dollars on providing full-time care to the same person in a nursing home or an assisted-living facility.

To deal with these, and likely future cuts to the federal budget, states will need to focus on policies that maximize their use of federal funds and intelligently and efficiently prioritize their own funds.  To make the best use of funds during tough fiscal times, it becomes increasingly important to budget using a results-based public policy framework. First, states should set priorities for budget decisions by engaging stakeholders and focusing on measurable results.

State and local policymakers are being forced to do more with less, and innovative strategies are needed to make this happen. Facing the current fiscal year of sequestration as well as other budget cuts, it will be ever more important for policymakers to support policies that maximize federal dollars, maximize return on investment and generate savings to invest in what works. This includes maximizing funds for the Supplemental Nutrition Assistance Program, utilizing the Food Stamp Employment and Training Program, taking advantage of the flexibility of the Temporary Assistance to Needy Families funds to target priority areas, and ensure that families are aware of the benefits of filing for federal tax credits.    

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