Local effects of federal budget cuts still unknown
Published: Thursday, February 28, 2013 at 7:49 a.m.
Last Modified: Thursday, February 28, 2013 at 7:49 a.m.
Local government officials are scrambling to assess the impact -- still largely unknown -- of the $85 billion in federal spending cuts due to begin taking effect Friday.
Unless or until President Barack Obama and Congress reach another budget agreement, the so-called sequester cuts are expected to trim long-term unemployment benefits, cause airport delays and reduce services at national parks, among other national impacts.
In California, a nearly $90 million funding cut for public schools could eliminate 1,210 teacher and aide jobs, while Head Start services for about 8,200 children would be eliminated, according to a White House report.
But officials said Wednesday they haven't calculated the impact at the county level.
"We don't know how this is going to play out," said Jim Leddy, the county's governmental affairs manager.
"It gets very complicated," he said, noting that some federal funding comes directly to the county and some is distributed by the state.
County agencies, including health and social services and the Sheriff's Office, are trying to determine how they may be affected, Leddy said.
More than half of the nation's 2.1 million federal government workers may be required to take furloughs, which cannot start until April 1.
Possible closure of the control tower at the Charles M. Schulz-Sonoma County Airport, which Leddy said would idle about 14 Federal Aviation Administration workers, won't happen until April.
Alaska Airlines service at the airport would continue during a tower shutdown, airport officials said.
Rep. Mike Thompson, D-St. Helena, said last week the sequester could cost California 225,000 federal jobs.
Sonoma County's 1,400 federal workers make up less than 1 percent of the 180,700-person workforce, a marginal amount, said Robert Eyler, director of the Center for Regional Economic Analysis at Sonoma State University.
But federal program cuts could lop off jobs at nonprofit organizations or government agencies, and every job loss ripples through the economy in reduced spending on goods and services, he said.
Where the cuts will fall is the key, Eyler said, and the answer is largely unknown.
"It's all reaching around in the dark," he said.
Much of the federal budget is insulated from the automatic cuts, including Social Security, Medicaid, food stamps and veterans programs.
The sequester's blunt approach, with cuts falling heavily on the Pentagon, was intended to prompt compromise between the White House and congressional Republicans on a deficit-reduction plan.
But it hasn't worked out that way yet, with Obama and congressional leaders set to meet Friday at the White House and most Americans, according to polls, largely unconcerned about the impasse.
"We need a balanced, bold plan that creates jobs, cuts spending, reforms our tax code so that everyone is paying their fair share and protects Social Security and Medicare," Thompson said in a statement Wednesday.
Rep. Jared Huffman, D-San Rafael, said he is backing a House Democratic plan that hits the sequester target of $1 trillion in deficit reduction over 10 years by boosting taxes on high-income earners, ending some tax breaks to oil and gas companies and curbing farm subsidies.
The sequester plan is "too abrupt," Huffman said, adding that it would eliminate 700,000 jobs nationally.
California accounts for nearly one-third of the job losses due to its concentration of defense facilities, universities and large population, he said.
Nationwide, about 2 million long-term unemployed people could see a $30 cut in benefit checks now averaging $300 a week.
Eyler, the SSU economics professor, said he considers the sequester "a necessary evil," noting that $85 billion in the current federal fiscal year is "a relatively insignificant amount of spending."
The cuts would exert some "downward pressure" on economic growth, he said, which might be offset by increased business investment prompted by clear economic signals from Washington, he said.
"The biggest problem (for business and the financial markets) is uncertainty," Eyler said. The sequester cuts, whether "good, bad or indifferent," would offer certainty, he said.
This report includes information from Associated Press. You can reach Staff Writer Guy Kovner at 521-5457 or guy.
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