SD would feel deepest sequester pain, Pew Center study reports

Talk about it

South Dakota will feel deeper financial pain than any other state if the sequestration happens as scheduled — or threatened — on Friday, according to a report.

A Pew Center study claims that South Dakota would suffer the largest share of loss of federal grants as a percentage of state revenue from the sequestration. The federal grants that would be cut by the sequester total more than 10 percent of South Dakota’s state revenue.

Sequestration is the term being used for $1.2 trillion in cuts to federal agencies over the next decade. They will start Friday unless Congress and President Obama can reach a com- promise, or, as they did at the end of 2012, delay the decision.

Gov. Dennis Daugaard, who was in Washington, D.C., for the annual National Association of Governors conference this past weekend, called for caution in the 2013 legislative session because of the looming possible budget cuts.

In his Dec. 5 budget address, Daugaard said South Dakota, which receives 10.3 percent of its revenue from federal grants, could lose up to $29 million.

“Because we live in a time of much uncertainty, I believe we should wait and see what actions are taken by our president and Congress in the coming months, and what it could do to our economy,” he said in the speech.

Sen. Tim Johnson, D-S.D., said South Dakotans and communities across the state rely on the numerous programs that would be targeted by the sequester.

“South Dakotans are going to feel the cuts from the sequester,” Johnson said in a news release. “Teachers, work study students, military civilians across the state, meals for seniors, and first responders are all going to take a hit. The negative consequences of the sequester will not happen all at once but over the course of the year. This impact will be very negative.”

He said it was time to “stop the political mudslinging” in Congress and find a solution.

“The Senate will be voting on a balanced approach to avoid these cuts this week,” Johnson said. “I call on my Republican colleagues to vote for this reasonable plan that provides for targeted cuts along with raising revenue.”

According to the White House’s numbers for South Dakota, among those who will see funding cuts are teachers and schools, who would lose about $1,162,000. Approximately $1,779,000 in funds for about 20 teachers, aides and staff who help children with disabilities would be lost, and there would be cuts to work study jobs, child care and Head Start and Early Head Start.

South Dakota would also lose money intended for law enforcement, job assistance and public health. In addition, approximately 1,000 civilian Department of Defense employees would be furloughed, reducing gross pay by around $6.3 million in total; Army base operation funding would be cut by about $900,000; and funding for Air Force operations in South Dakota would be cut by about $1 million.

The Aerospace Industries Association claims sequestration could cost South Dakota more than 4,700 jobs and more than $470 million in gross state product due to cuts in spending on defense and other programs.

Sen. John Thune said he found the timing of the White House’s impact statements curious.

“It strikes me as odd that we just received the reports Sunday night on the state-by-state impact of the sequester, especially since my legislation, the Sequestration Transparency Act, which was signed into law by the president, required his administration to provide its plan to the American people by September of 2012,” Thune said in a statement to The Daily Republic. “Unfortunately, the report that the White House finally issued in September did not offer the level of detail required by the law. After refusing to provide taxpayers, states, and Congress with this information for more than a year, the White House is now ginning up fear at the eleventh hour rather than offering solutions.”

He said he will “remain committed to working with my colleagues” to solve the problem.

“This is why I am a cosponsor of the Down Payment to Protect National Security Act (S. 263), which would replace all of the sequester for 2013 with alternative savings, such as reducing the federal workforce through attrition and freezing salaries for members of Congress,” Thune said in the statement. “I believe there are better ways than the president’s sequester to reduce spending. Federal spending has increased by nearly 20 percent since 2008, and Washington should be able to absorb a 2.4 percent spending reduction to the $3.5 trillion budget in a smart and efficient manner.”

Tags: news, updates, state, national, budget, sequestration, cuts