National Council for Workforce Education Annual Conference

1. National Council for Workforce Education Annual Conference Understanding the Federal Budget Long Beach, CA October 21-23

2. Our Vision We seek an America that grows its economy by investing in its people, so that every worker and every industry has the skills to compete and prosper.

3. Our Mission • We organize broad-based coalitions seeking to raise the skills of America’s workers across a range of industries. • We advocate for public policies that invest in what works, as informed by our members’ real-world expertise. • And we communicate these goals to an American public seeking a vision for a strong U.S. economy that allows everyone to be part of its success.

4. Federal Budget

5. Total Federal Spending, FY 2012

6. Discretionary Spending, FY 2012

7. Budget Increasingly Important Policy Tool • Budget defines federal spending priorities • Focus almost entirely on debt reduction • Decisions about funding cuts made through budget process • Budget process increasingly being used to make policy changes

8. Big Funding Cuts to Workforce Programs in Recent Years • In FY 2011 House passed HR 1, $4B in cuts(including elimination of WIA)—eventually cut more than $1B • In FY 2012 House proposed more than $2B in cuts to DOL + $44B in Pell cuts—eventually cut about $11B from Pell

9. Budget and Appropriations Process

10. Budget Activities Are Year Round

11. Step 1: Federal Budget Process • Fall 2012: Administration and agencies developing FY 2014 budget proposal

12. Step 2: Federal Budget Process • February 2013: Administration sends budget proposal to Congress

13. Step 3: Federal Budget Process • April 2013: Budget Committee releases Budget Resolution (April 1); Congress adopts Budget Resolution (April 15)

14. What’s the Budget Resolution? • Budget Resolution governs annual spending process for Congress • It’s a rule, not a law (not signed by President) • Sets broad spending levels for Appropriations Committees

15. “Views and Estimates” and “Member Request” Letters • Views and Estimates: Authorizing committees send letters to Budget Committee expressing funding priorities for programs under their jurisdiction (March 2013) • Member Request: MoCscan send letters to Appropriations Committee expressing their funding priorities (March-May 2013)

16. Step 4: Federal Budget Process • May 2013: Focus shifts to appropriations; Appropriations Committees can begin work even if Budget Resolution not adopted

17. Step 5: Federal Budget Process • Summer/Fall 2013: Appropriations Committees report out 12 bills (including Labor-HHS-Education); Congress takes up Appropriations bill

18. Budget Reconciliation • Special budget process designed to make large funding cuts • Expedited procedure—cannot be filibustered—with narrowly defined rules • Typically targets mandatory spending

19. Step 6: Federal Budget Process • September 2013: Finish FY 2013 (September 30); FY 2014 begins (October 1) • October 2013: Start FY 2015 budget process

20. Sequestration

21. Discretionary Spending, FY 2012

22. “Non-Defense Discretionary” (NDD) Spending • NDD programs are core government functions • NDD budget represented just 3.4 % GDP in 2011, yet have borne the brunt of deficit reduction efforts so far • Since FY 2010, NDD programs have been cut by 10 percent on average, with many programs cut by as much as 50 percent

23. Budget Control Act (P.L. 112-25) • Debt ceiling deal • $1T in cuts through new spending caps • Created “super committee” to develop another $1.2T in cuts • Included sequestration trigger if super committee failed

24. Sequestration • Triggered when “super committee” failed • Automatic, across-the-board cut (estimates range from 8.2% to more than 12%) • Equally applied to defense and non-defense • In addition to $1T in cuts already applied

25. What Does Sequestration Actually Do? • Cuts Implemented January 2013 • Automatic cuts each year, 2013 through 2021 • $109B, equally divided between “national defense” and all other (non-defense) programs

26. How Do the Cuts Work? • Non-defense cuts include both mandatory and discretionary programs • But many mandatory programs exempt • Social Security, SNAP, child nutrition, SSIA, EITC and child tax credit, etc. • Exempt mandatory programs means discretionary program must absorb more of the cuts

27. What Does This Mean for Workforce Programs? • NSC analysis of key programs suggests cut of about $630M in FY 13 and about 3M fewer people served (most conservative estimate) • Caps would stay at least at this level through 2021

28. Sequestration • Everyone agrees that sequesters would be catastrophic. No one agrees on what to do instead • Tremendous pressure to undo defense sequesters—potentially at the cost of non-defense programs • Administration and Senate Leadership say they will only accept balanced alternative

29. So What’s Going to Happen? • Congress will return for lame duck session post-election • Many people hope some of the political “heat” will dissipate and create an opportunity to find a solution • But Congress could just take up short-term solution and punt into next year

30. Stay Connected • Visit us our website. • Sign up for our member email list. • Follow us on:

31. Contact Rachel Gragg, Ph.D. Federal Policy Director National Skills Coalition 202-223-8991, ext. 102 rachelg@nationalskillscoalition.org