How are some agencies avoiding likelihood of sequester furloughs?

February 28, 2013
(Andrew Harrer/AP)
(Andrew Harrer/AP)

Official communications in recent weeks have shown that some federal agencies are better-positioned than others to avoid furloughs if the Friday sequester deadline passes without Congress passing an alternative deficit-reduction plan.

The Government Accountability Office, the Small Business Administration, the Smithsonian Institution and the U.S. Agency for International Development have all said unpaid leave won’t be necessary to meet their cost-saving targets if the deep automatic cuts take effect later this week.

So how have those agencies managed to avoid the likelihood of furloughs while others are talking doom and gloom?

Some union leaders and lawmakers, especially Republicans, say planners just have to put their minds to it.

“They really haven’t done their homework,” said John J. O’Grady, president of a Chicago-region chapter of the American Federation of Government Employees. “They’re under illusion that [the sequester] wasn’t really going to happen.”

O’Grady said most agencies haven’t yet maximized reductions in contractor spending and that some have provided five-figure bonuses to managers during the past fiscal year, despite the automatic cuts looming.

But many experts who study federal budgets have said other factors come into play.

“Agencies have enormous discretion in this regard, but some are so predominantly personnel-driven that they have little choice but to furlough,” said Patrick Lester, director of fiscal policy for the Center for Effective Government.

Indeed, the Pentagon, Department of Homeland Security and Federal Aviation Administration have said in recent weeks that they expect furloughs to be necessary under a possible sequester, and all dedicate a relatively high percentage of their budgets toward pay and benefits.

Lester said agencies that rely heavily on grants and contracting are less likely to depend on unpaid leave to meet their reduction targets. “They have the ability to push the cuts into their contracts — they can delay them,” he said.

Most agencies don’t fall neatly into the contract- and personnel-heavy categories, leaving room for critics to question virtually every government entity that says it might resort to furloughs.

Conservatives have challenged agencies to identify and trim more waste, while union leaders have urged them time and again to reduce spending on private contractors — even pressing Congress to pass legislation to that effect.

As for the relatively small GAO, which has about 2,900 workers, Comptroller Gene L. Dodaro sent a memo to employees last week saying the agency could likely meet its sequester target by halting new hires, trimming travel expenditures and reducing IT investments.

“We project that we would no longer require furloughs at GAO to absorb the potential reduction associated with sequestration,” Dodaro said.

Similarly, the SBA has said it had reduced staffing levels enough through early retirements to avoid furloughs and that the agency expects to meet demand for its small business loans moving forward, according to an article by the Associated Press.

“We are not slowing down giving loans to anyone,” SBA Administrator Karen Mills told reporters last week, noting that the agency aniticates a sharp decline in demand for the 504 loans that spiked last year due to a now-expired provision allowing the funds to be used for refinancing mortgages.

Smithsonian Institution spokeswoman Linda St. Thomas said on Wednesday that the museum operator has budgeted “very, very conservatively” since the start of the fiscal year, anticipating that the sequester would happen.

Like other agencies, the Smithsonian Institution has delayed maintenance and repairs, adjusted contracts and reduced staff travel and training to help achieve its target savings, according to St. Thomas.

Two-thirds of the organization’s roughly 6,000 workers are federal employees — the rest work for the independent Smithsonian trust fund. But St. Thomas said the institution does not expect to use furloughs for any of its personnel if the sequester takes effect.

USAID said in an agency notice to employees last week that it does not intend to furlough workers this year and instead anticipates meeting its reduction targets by halting new hires, modifying contracts and cutting planned IT investments.

 

For more federal news, visit The Federal Eye, The Fed Page and Post Politics.

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E-mail federalworker@washpost.com with news tips and other suggestions.

Josh Hicks covers the federal government and anchors the Federal Eye blog. He reported for newspapers in the Detroit and Seattle suburbs before joining the Post as a contributor to Glenn Kessler’s Fact Checker blog in 2011.
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