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Federal Grant Programs and the Sequester

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It’s a major day of defeat for Congress, which bilaterally failed to prevent the across-the-board funding cuts that take effect today. It’s an even greater defeat for all those affected by the cuts—federal employees, students and teachers, scientists, defense contractors, airline passengers, low-income earners, the homeless and near-homeless, and so on. The list goes on as the reality sinks in.

The remainder of the FY2013 federal budget will see an $85 billion cut split evenly with nonexempt defense and nondefense programs. Because eCivis assists local governments and community-based organizations in researching grant opportunities, a grant focus should be the slant of this article. So let’s look at a sample of the sequester's effects.

HUD Grants: Cutting Out the Neediest

Two weeks ago HUD secretary Shaun Donovan testified before Congress about the dire consequences of the cuts. Here are some of the secretary’s points:

  • 125,000 individuals and families, including elderly and disabled individuals, could lose assistance provided through the Housing Choice Voucher (HCV) program.
  • More than 100,000 formerly homeless people, including veterans, are projected to be removed from their current housing or emergency shelter programs (primarily Continuum of Care programs), putting them at substantial risk of becoming homeless.
  • The Emergency Solutions Grants (ESG) program, the nation’s shelter system for the homeless, could face cuts leading to shelter closures.
  • Cuts to the Housing Opportunities for Persons with AIDS program would result in 7,300 fewer low-income households receiving permanent and short-term supportive housing assistance, including rental or utility assistance.
  • Community Development Block Grant (CDBG) funding will see cuts as well. The Bipartisan Policy Center has a state-by-state breakdown of the cuts here. The mandatory portion cut is approximately $161 million from $2.07 billion; the discretionary portion cut, approximately $80 million from $880 million.

Education Cuts for 2013-2014 School Year

Education Department funding will be cut by nearly $3 billion for FY2013, setting the funding level back to that of 2004—actually, below that. Cuts include:

  • $740 million cut from Title I grants for local education agencies
  • $406 million cut from Head Start
  • $644 million cut from special education (IDEA)
  • $59 million cut from Impact Aid Basic Support Payments
  • $126 million cut from Improving Teacher Quality State Grants
  • $59 million cut from 21st Century Community Learning Centers
  • $9 million cut from rural education

FAA to Take Brunt of DOT Cuts

The Department of Transportation is set to have $1 billion cut from its budget, but the Federal Aviation Administration will suffer $600 million of that cut, resulting in furloughs beginning in April, overnight shifts being eliminated at these 60 facilities, and closure of over 100 air traffic control facilities.

NIH and NSF Grants: Success Rates to Drop

The number of research grant awards is projected to fall significantly under sequester. According to a Research!America report:

  • National Institutes of Health (NIH) grant success rates are projected to drop from 19% (8,743 awards) to 15% (7,115 awards)
  • National Science Foundation (NSF) grant success rates are projected to drop from 22% (11,700 awards) to 16% (8,977 awards)

According to the Office of Management and Budget (OMB), the NIH faces a $1.6 billion cut and the NSF faces a $338 million cut (calculations prior to the fiscal deal).

Your Take

What's your perspective on the sequester? The impact on state and local governments is uncertain still, but the trickle-down effect from the federal funding cuts is looming


About eCivis

eCivis is the nation's leading grants management software solution and the ideal platform for improving grants performance for local governments and community-based organizations. For more information about eCivis, visit www.ecivis.com. For media inquiries, contact media@ecivis.com.

The funding cuts might be daunting, but that only means that your grant seeking should be even fiercer:

Why You Should Consider Competitive Grants for FY2015 Budget Planning