Federal Relations

August 1, 2012

OMB Issues Sequester Memo

In a memo to federal agencies dated July 31, 2012, the Office of Management and Budget (OMB) indicated that military personnel would be spared in automatic budget cuts due early next year and that agencies should continue normal spending and operations even with the potential reductions just five months away. OMB Acting Director Jeff Zients said in the memorandum that OMB officials will meet with departments to discuss how the cuts under sequester work and what programs could be exempt. Up to now, administration officials have indicated that they believe Congress will find a way to avoid the sequester, and the White House still believes a budget agreement to replace the sequester is possible. In the meantime, Zients suggested agencies not adjust their rate of spending at the October 1st start of the fiscal year but “continue normal spending and operations since more than five months remain for Congress to act.”

Read the OMB memo.