Federal employees dodge another direct budget hit

Columnist April 12, 2011

Federal employees dodged a bullet when a proposal to stop certain wage increases that are largely based on longevity failed to make it into last week’s budget deal between President Obama and congressional leaders.

And workers can now breathe another sigh of relief because details of the agreement released by the House Appropriations Committee Tuesday do not contain any direct hit on their paychecks.

Joe Davidson writes the Federal Diary, a column about the federal workplace that celebrated its 80th birthday in November 2012. View Archive

The details put meat on the agreement that Obama, Speaker John Boehner (R-Ohio) and Senate Majority Leader Harry Reid (D-Nev.) reached to stop the government from shutting down. Overall, the agreement for fiscal 2011 would knock $38 billion off the 2010 spending level. Under the agreement, funding for employee “salaries and expenses” or “compensation and benefits” would decline at certain agencies, in some cases a great deal, from the amount Obama proposed for fiscal 2010.

That does not, however, mean individual paychecks would drop.

Compared with the enacted budget for fiscal 2010, total expenditures for “salaries and expenses” in the Agricultural Research Service would drop by $44 million to $1.14 billion and in Agriculture’s Rural Development Program by $10 million to $192 million. Three Justice Department agencies — the Office of Justice Programs, Office of Violence Against Women and Community Oriented Policing Services — would see a total of $26 million cut from the fiscal 2010 level of $192 million. Salaries and expenses for a separate item, “legal activities,” would fall by $10 million to $865 million. “Personnel compensation and benefits” in the Department of Housing and Urban Development programs would drop by $17 million from $979 million.

In each case, the cuts are substantially more when compared with Obama’s proposed budget for fiscal 2011: a $64 million cut for Agricultural Research Service salaries and expenses; $40 million in Rural Development; $92 million for the three Justice Department agencies; $111 million for legal activities salaries and expenses; and $50 million for HUD personnel compensation and benefits.

Additionally, there are other items that could impact salary expenditures, such the $13 million cut from the Transportation Security Administration headquarters and administration budget for fiscal 2010. That’s a $64 million drop from the president’s proposed budget for 2011. Unspecified cuts at the Office of Personnel Management would slice $5 million off its 2010 budget level.

Congress doesn’t plan to exempt itself from spending cuts. Its budget would drop by $103 million, with $55 million of that in the House. Budgets for member, committee and leadership offices would fall by 5 percent, except for the House Appropriations Committee, which would see a 9 percent hit.

Cuts to salaries and expenses budgets may sound threatening, but Frankie and Flo Fed don't need to pawn grandma’s ring yet. Slashing current salaries and benefits is not part of the agreement.

Managers can save on salaries and compensation in other ways. They can freeze hiring and not fill vacancies, allowing staff levels to fall through attrition. Early retirement offers and buyouts also can be used to reduce personnel. Fewer or lower performance awards and bonuses may be given.

Furthermore, expenses include more than salaries. Training, travel, conferences, office equipment upgrades — the costs of general overhead — are just some of the things that can be cut before people are laid off.

Of course, some cuts come with a price. Cutbacks on training, for example, may save dollars up front, but cost an agency more in the long run through decreased productivity.

Although Frankie and Flo don’t face an immediate threat from the budget agreement, they should keep an eye on Republican proposals that would make life more difficult for them.

On Wednesday morning, for example, the House Committee on Oversight and Government Reform is scheduled to consider legislation offered by Rep. Jason Chaffetz (R-Utah), which would prohibit people who are “seriously delinquent” on their taxes from being federal employees. They would be protected if they are paying their debts in a timely manner or if a hearing on the debt is requested. Similar legislation would prevent delinquent contractors from working for the government.

Another bill, by Rep. Dennis Ross (R-Fla.), would extend the federal employment probationary period from one year to two.

The meeting likely will be a hot one. Democrats opposed the Chaffetz bill on federal employee tax delinquents when it was considered last year. His bills did not have a hearing this year. The Ross bill has not had a hearing this year or last, and that lack of process also promises to be a point of contention.

An afternoon hearing by the federal workforce subcommittee, chaired by Ross, looks at the Federal Employees Compensation Act, which provides workmen’s compensation for injured federal workers, including some who are past retirement age.

Staff writer Eric Yoder contributed to this column.

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