[House Hearing, 113 Congress]
[From the U.S. Government Publishing Office]



 
 SEQUESTRATION OVERSIGHT: UNDERSTANDING THE ADMINISTRATION'S DECISIONS 

                     ON SPENDING CUTS AND FURLOUGHS
=======================================================================



                                HEARING

                               before the

                    SUBCOMMITTEE ON ECONOMIC GROWTH,

                  JOB CREATION AND REGULATORY AFFAIRS

                                 of the

                         COMMITTEE ON OVERSIGHT

                         AND GOVERNMENT REFORM

                        HOUSE OF REPRESENTATIVES

                    ONE HUNDRED THIRTEENTH CONGRESS

                             FIRST SESSION

                               __________

                             MARCH 19, 2013

                               __________

                           Serial No. 113-10

                               __________

Printed for the use of the Committee on Oversight and Government Reform


         Available via the World Wide Web: http://www.fdsys.gov
                      http://www.house.gov/reform




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              COMMITTEE ON OVERSIGHT AND GOVERNMENT REFORM

                 DARRELL E. ISSA, California, Chairman
JOHN L. MICA, Florida                ELIJAH E. CUMMINGS, Maryland, 
MICHAEL R. TURNER, Ohio                  Ranking Minority Member
JOHN J. DUNCAN, JR., Tennessee       CAROLYN B. MALONEY, New York
PATRICK T. McHENRY, North Carolina   ELEANOR HOLMES NORTON, District of 
JIM JORDAN, Ohio                         Columbia
JASON CHAFFETZ, Utah                 JOHN F. TIERNEY, Massachusetts
TIM WALBERG, Michigan                WM. LACY CLAY, Missouri
JAMES LANKFORD, Oklahoma             STEPHEN F. LYNCH, Massachusetts
JUSTIN AMASH, Michigan               JIM COOPER, Tennessee
PAUL A. GOSAR, Arizona               GERALD E. CONNOLLY, Virginia
PATRICK MEEHAN, Pennsylvania         JACKIE SPEIER, California
SCOTT DesJARLAIS, Tennessee          MATTHEW A. CARTWRIGHT, 
TREY GOWDY, South Carolina               Pennsylvania
BLAKE FARENTHOLD, Texas              MARK POCAN, Wisconsin
DOC HASTINGS, Washington             TAMMY DUCKWORTH, Illinois
CYNTHIA M. LUMMIS, Wyoming           DANNY K. DAVIS, Illinois
ROB WOODALL, Georgia                 PETER WELCH, Vermont
THOMAS MASSIE, Kentucky              TONY CARDENAS, California
DOUG COLLINS, Georgia                STEVEN A. HORSFORD, Nevada
MARK MEADOWS, North Carolina         MICHELLE LUJAN GRISHAM, New Mexico
KERRY L. BENTIVOLIO, Michigan        VACANCY
RON DeSANTIS, Florida

                   Lawrence J. Brady, Staff Director
                John D. Cuaderes, Deputy Staff Director
                     Robert Borden, General Counsel
                       Linda A. Good, Chief Clerk
                 David Rapallo, Minority Staff Director

  Subcommittee on Economic Growth, Job Creation and Regulatory Affairs

                       JIM JORDAN, Ohio, Chairman
JOHN DUNCAN, Tennessee               MATTHEW A. CARTWRIGHT, 
PATRICK T. McHENRY, North Carolina       Pennsylvania, Ranking Minority 
PAUL GOSAR, Arizona                      Member
PATRICK MEEHAN, Pennsylvania         TAMMY DUCKWORTH, Illinois
SCOTT DesJARLAIS, Tennessee          GERALD E. CONNOLLY, Virginia
DOC HASTINGS, Washington             MARK POCAN, Wisconsin
CYNTHIA LUMMIS, Wyoming              DANNY K. DAVIS, Illinois
DOUG COLLINS, Georgia                STEVEN A. HORSFORD, Nevada
MARK MEADOWS, North Carolina
KERRY BENTIVOLIO, Michigan
RON DeSantis Florida

                            C O N T E N T S

                              ----------                              
                                                                   Page
Hearing held on March 19, 2013...................................     1

                               WITNESSES

Mr. David Robbins, Managing Director, Federal Communications 
  Commission
    Oral Statement...............................................     8
    Written Statement............................................    11
Mr. Michael L. Young, Director, Office of Budget and Program 
  Analysis, United States Department of Agriculture
    Oral Statement...............................................    15
    Written Statement............................................    17
Mr. Hari Sastry, Deputy Assistant Secretary for Resource 
  Management, Office of the Secretary, U.S. Department of 
  Commerce
    Oral Statement...............................................    21
    Written Statement............................................    23

                                APPENDIX

The Honorable Eleanor Holmes Norton, a Member of Congress from 
  the District of Columbia, Opening Statement....................    48
The Honorable Jim Jordan, a Member of Congress from the State of 
  Ohio, Opening Statement........................................    50
Politico_Now Dems Worry: Did President Obama cry wolf?...........    52
Letter from Rebecca M. Blank, The Deputy Secretary of Commerce to 
  the Honorable Barbara A. Mikulski, a Member of Congress from 
  the State of Maryland..........................................    56


 SEQUESTRATION OVERSIGHT: UNDERSTANDING THE ADMINISTRATION'S DECISIONS 

                     ON SPENDING CUTS AND FURLOUGHS

                              ----------                              


                        Tuesday, March 19, 2013,

                  House of Representatives,
 Subcommittee on Economic Growth, Job Creation and 
Regulatory Affairs, joint with the Subcommittee on 
    Federal Workforce, U.S. Postal Service and the 
                                            Census,
              Committee on Oversight and Government Reform,
                                                   Washington, D.C.
    The subcommittees met, pursuant to notice, at 1:30 p.m. in 
room 2154, Rayburn House Office Building, the Honorable Blake 
Farenthold [chairman of the Subcommittee on Federal Workforce, 
U.S. Postal Service and Census], presiding.
    Present: Representatives Farenthold, Jordan, McHenry, 
Duncan, Gosar, DesJarlais, Lummis, Meadows, DeSantis, Issa, 
Cartwright, Norton, Clay, Connolly, Pocan, Horsford, and 
Cummings.
    Also present: Representative Mulvaney.
    Staff Present: Kurt Bardella, Majority Senior Policy 
Advisor; Molly Boyl, Majority Parliamentarian; Caitlin Carroll, 
Majority Deputy Press Secretary; Drew Colliatie, Majority 
Legislative Assistant; John Cuaderes, Majority Deputy Staff 
Director; Brian Daner, Majority Counsel; Adam P. Fromm, 
Majority Director of Member Services and Committee Operations; 
Linda Good, Majority Chief Clerk; Tyler Grimm, Majority 
Professional Staff Member; Jennifer Hemingway, Majority Senior 
Professional Staff Member; Frederick Hill, Majority Director of 
Communications and Senior Policy Advisor; Michael R. Kiko, 
Majority Staff Assistant; Mark D. Marin, Majority Director of 
Oversight; James Robertson, Majority Professional Staff Member; 
Scott Schmidt, Majority Deputy Director of Digital Strategy; 
Matthew Tallmer, Majority Investigator; Jaron Bourke, Minority 
Director of Administration; Lena Chang, Minority Counsel; Devon 
Hill, Minority Research Assistant; Brian Quinn, Minority 
Counsel; and Safiya Simmons, Minority Press Secretary.
    Mr. Farenthold. The committee will come to order.
    As is normal at our meetings of the Committee and 
Subcommittee on Government Oversight and Reform, we start each 
meeting by reading our mission statement.
    We exist to secure two fundamental principles. First, 
Americans have a right to know that the money Washington takes 
from them is well spent. And second, Americans deserve an 
efficient, effective Government that works for them.
    Our duty on the Government Oversight and Reform Committee 
is to protect these rights. Our solemn responsibility is to 
hold the Government accountable to taxpayers because taxpayers 
have a right to know what they get from their Government. We 
will work tirelessly in partnership with citizen watchdogs to 
deliver the facts to the American people and bring genuine 
reform to the Federal bureaucracy.
    This is the mission of the Oversight and Government Reform 
Committee.
    At this point, I will make my opening statement and we will 
then let the ranking member give her opening statement and then 
this is a joint Subcommittee hearing so we will also go to the 
Chairman and Ranking Member of the other Subcommittee.
    Today we are going to talk about stewardship of taxpayers' 
funds. That is what this hearing is about. It is about being 
responsible managers. And finally, it is about the credibility 
of this Administration.
    The bottom line, is agencies should have planned better for 
sequester. And if the President, the Government agencies and 
the Secretaries who head these agencies would spend more time 
planning and less time with political posturing before the 
American people with scare tactics about the sequester, we 
would be better off.
    Federal agencies have known about the sequester since 
August of 2011. My grandmother taught me a lot of things, but 
one thing that sticks with me that I use almost every day is 
plan for the worst and expect the best. Why didn't our 
Government agencies apply this bit of common sense in dealing 
with the sequester? Some did, some did not.
    Those who didn't could have done some simple things, like 
rein in bonuses, cut wasteful and frivolous spending and, as we 
will learn in the course of this hearing, implement reports of 
their own IGs to save money.
    But what have the agencies done instead? They have listened 
to irresponsible advice. Last summer, the OMB instructed 
agencies to continue normal spending and operations since more 
than five months remained before sequester took effect. This 
was reckless. Sequester was the law of the land then as it is 
today. So why didn't agencies at least have a contingency plan?
    Even our Federal employee unions recognize that agencies 
did not take sequester seriously. A regional president of the 
American Federation of Government Employees recently commented 
that agencies really have not done their homework. They are 
under the illusion that the sequester was not going to happen.
    With the sequester now upon us, some of the 
Administration's spending choices make no sense. The only 
conclusion I can draw is the President wants to politicize the 
sequester and make the cuts as painful as possible. Rather than 
looking for the low-hanging fruit of waste, fraud and abuse, we 
have furloughs. Rather than keeping the White House open for 
tours, we have Presidential golf outings. And, quite frankly, I 
am appalled the President has thrown the men and women who 
would take a bullet for him, the Secret Service, under the bus 
for canceling White House tours.
    I don't believe for a second that if the President had 
asked, let's find somewhere else to cut, they would have found 
plenty of options. Hey guys, how about looking at the $300,000 
annual pay for calligraphers? The President and Executive 
Branch agencies are talking furloughs when on the day the 
sequester went effect, these agencies posted more than 400 
jobs. You know, instead of those calligraphers, ZapfChancery 
comes free on every MAC and does pretty nice name tags.
    I am also worried about the credibility of the 
Administration. We need to trust our President. But the trust 
is eroding due to his false rhetoric about the sequester. When 
President Obama said the janitors and security guards who work 
here at the Capitol will face pay cuts, the Superintendent of 
the Capitol had to send out an email to employees saying their 
pay and benefits would be safe. And when the Secretary of 
Education, Mr. Duncan, said teachers were getting pink slips, 
the Washington Post awarded him four Pinocchios for this claim.
    The public is starting to catch on. Politico recently ran 
an article asking, did President Obama cry wolf about the 
sequester. And the Chicago Tribune ran an editorial this week 
headlined Truth-Squadding Sequester Hysteria, Officials 
Sabotage Themselves When They Manipulate, Exaggerate and Flout 
Common Sense.
    Again, if our agencies would get to work and plan instead 
of using scare tactics, we would be better off.
    Thank you all for being here. I am looking forward to 
productive discussion as we talk about how we are going to 
manage the sequester.
    I will now recognize Ms. Norton for five minutes.
    Ms. Norton. Thank you very much, Mr. Chairman.
    We should not be surprised by the scope of the damage that 
sequester will bring. Congress was warned what would happen if 
sequester took effect. We were informed about the potential 
devastation of vital Government programs and services and on 
furloughs of more than 1 million Federal employees. The 
Congressional Budget Office estimated that the $85 billion cut 
required by the Budget Deferral Act of 2011 will cause the loss 
of 750,000 jobs and will slow the economy by .6 percent.
    Instead of trying to prevent the sequester from happening, 
our colleagues on the other side of the aisle embraced it. They 
wanted it to happen. In fact, a member of this Committee said 
just last month, quoted in her paper, ``Sequester will take 
place. I am excited. It will be the first time since I have 
been in Congress that we really have significant cuts.''
    As a result of the sequester, Federal agencies, including 
the Department of Agriculture and the Department of Commerce 
and the Federal Communications Commission are now required to 
follow the specific mandates of the Budget Control Act to make 
across-the-board, indiscriminate and untargeted cuts to each 
account, and I repeat, each account, calligraphers, yes, and 
other accounts, you cannot substitute one for the other, 
program and project and activity by program, project and 
activity.
    The agencies have noted that the law gives them little 
discretion at implementing the cuts and that such cuts could 
negatively impact their missions, the services they provide to 
the American people and the economic recovery itself.
    For Agriculture, this would require cutting $2 billion 
across the board. Where do you think those dollars would have 
gone? To help the private sectors, to farmers, agribusiness 
and, yes, poor people. For Commerce, sequestration would mean 
$550 million in across-the-board cuts. Where do you think that 
money would have gone? To help the private sector, the small 
business and satellite infrastructure.
    For the FCC sequestration, the cut would be $17 million. 
Guess who is going to benefit from those dollars? You guessed 
it, the private sector. Now that sequester is taking effect, 
Republicans want to shift the blame for the cuts to Government 
activities benefiting even the private sector.
    Our colleagues on the other side of the aisle have accused 
the agencies of exaggerating the negative effects of 
sequestration for political gain. They claim that the agencies 
can simply undo sequestration by eliminating wasteful and 
duplicative programs or reducing other spending. Well, that is 
exactly what we would have done without sequestration. And that 
is what sequestration does not allow.
    And they have criticized the Administration for 
implementing the sequester too slowly. A Republican-controlled 
House required across-the-board cuts as their price for 
extending the Nation's debt limit and overting the first fiscal 
default in the Nation's history. A Republican-controlled House 
has continued the longstanding practice of controlling the 
power of the purse which by law give Federal agencies the 
freedom to spend money as they choose. Why do they have to 
spend money as Congress chooses for them and are not free to do 
or undo sequester on their own?
    A Republican-controlled House gave the agencies until April 
11th, which is 30 days after the President issued the sequester 
order, to submit to Congress their sequester plans. As I look 
at the calendar, the agencies still have a couple of weeks to 
go. Contrary to the accusations of some Republicans, the 
agencies are not late.
    So, this hearing today attacks the problem caused by 
sequestration from exactly the wrong angle. If the Republican 
House does not like the effects of across-the-board cuts, why 
did they insist on them? Why have some embraced them? Why have 
some feared for them?
    If the Republican House does not like the fact that 
agencies' hands are tied by law, and that only Congress can 
mitigate the damaging consequences of sequestration, why have 
they not changed the law? If the Republic House does not like 
the time that Federal agencies are using to develop 
implementation plans, why did they give the agencies so much of 
it?
    The course of sequestration can still be done. This is 
still the House of Representatives. Today's hearing really 
should be entitled Sequestration Oversight: What Were House 
Republicans Thinking? That might be something for American 
businesses to ponder in the days to come.
    Thank you, Mr. Chairman, and I yield back.
    Mr. Farenthold. Thank you, Ms. Norton.
    I now recognize the Chairman of the Subcommittee on 
Economic Growth, Mr. Jordan, for an opening statement.
    Mr. Jordan. Thank you, Mr. Chairman.
    Real quickly, in response to the Ranking Member's 
statement, the reason we support reducing spending and 
sequestration is because we have a debt larger than our entire 
annual economy. We do have to cut some spending around this 
place and we are finally taking some modest first steps.
    Second, we did try to change how this was implemented. We 
passed two pieces of legislation in the last Congress that 
passed the House of Representatives but, as with so many other 
bills when they get to the Senate, it went nowhere.
    With that, Mr. Chairman, I will go to my statement.
    Today's hearing compares the reality of sequestration with 
the rhetoric of this Administration. The Obama Administration 
has misled the American people with horror story after horror 
story about the sequester.
    First, Education Secretary Arne Duncan went on National 
television and claimed that teachers were literally getting 
pink slips. The Washington Post, that wonderful conservative 
newspaper, later awarded him four Pinocchios for his claim.
    Next, we had the President. I guess he didn't want to be 
outdone and wanted his Pinocchios as well because he claimed 
that janitors at the United States Capitol would receive a pay 
cut. Washington Post gave him the same that they gave Mr. 
Duncan, four Pinocchios. The President's statement prompted the 
Superintendent of the U.S. Capitol to email his staff to 
reassure them that this was not, in fact, the case.
    Now, newspapers are running stories about the 
Administration's smoke and mirrors. A Politico headline asked, 
``Did President Obama Cry Wolf About the Sequester?'' The 
answer was a pretty resounding yes and included criticism from, 
among others, former Democratic Pennsylvania Governor Ed 
Rendell.
    The Chicago Tribune ran an editorial last week entitled 
``Truth-Squadding Sequester Hysteria, Officials Sabotage 
Themselves When They Manipulate, Exaggerate and Flout Common 
Sense.'' It featured pictures of children unable to tour the 
White House holding up signs that said, the White House is our 
house, please let us visit. Now, news reports are indicating 
that the White House may cancel the annual Easter Egg Roll. The 
absurdity of this action would be comical if it were not so 
cruel.
    The USDA and the Department of Commerce are also partaking 
in the doomsday rhetoric. In mid-December of last year, 
Agriculture Secretary Vilsack issued a memo downplaying the 
possibility of the sequester and informed his staff that should 
it occur, USDA may have to consider some furloughs. Then, just 
a little over a month later, he changed his tune and declared 
that the USDA would have to furlough over 6,000 food inspectors 
for up to three weeks. He recently walked back that statement 
saying the U.S. Department of Agriculture would not seek 
continuous furloughs. So the obvious question is, which is it? 
Might happen, probably won't happen, or three weeks, 6,000 
people?
    The Department of Commerce said it would furlough up to 
2,600 employees at the National Oceanic and Atmospheric 
Administration. Yet, at the same time, it is advertising job 
openings at NOAA and it was hit with an IG audit that found 
NOAA paid more than $40 million in contracts without proper 
justification.
    Finally, let me express my disappointment with the 
extraordinary amount of effort it took to get the Department of 
Commerce and the Department of Agriculture to testify today. 
Despite multiple offers by the Committee to move the hearing 
date to accommodate these agencies, and the willingness of the 
Committee to accept several different alternative witnesses 
from each agency, the Committee ultimately had to threaten to 
use subpoenas to secure their testimony.
    Both agencies used delay tactics and appeared to play games 
with the Committee in an effort to avoid testifying. Even after 
finally agreeing to testify, the Department of Commerce 
notified the Committee that it was doing so ``reluctantly.'' I 
mean, this is amazing. An agency spending taxpayer dollars 
won't even come in front of Congress, comes reluctantly after 
they are given multiple opportunities, multiple dates to come 
and share what is happening with the American people's tax 
money.
    The American people have heard one dire warning after 
another about the impact of the sequester on their lives. Yet, 
when it comes to accountability and answering simple questions 
about what agencies are doing with the American people's money 
they throw up one roadblock after another.
    The issue has been at the forefront of the news for months. 
Therefore, the agencies should have been planning for months 
and it is inexcusable agencies would not have multiple people 
ready and available to talk about it.
    The American people have a right to know why they continue 
to be misled by this Administration in an effort to score cheap 
political points. They deserve truth. They deserve truthful and 
accurate answers, not more misleading rhetoric, and we hope, we 
hope to get the American people these answers today at this 
Committee hearing.
    And with that, Mr. Chairman, I yield back.
    Mr. Farenthold. Thank you, Mr. Jordan.
    We will now recognize the Ranking Member of the 
Subcommittee on Economic Growth, Mr. Cartwright, for his 
opening statement.
    Mr. Cartwright. Thank you, Chairman Farenthold, and thank 
you to the witnesses for attending the hearing today. I know we 
are pulling you away from your busy schedules to speak to us 
about the impact of sequestration.
    Everybody in this room knows that it is not crying wolf 
about sequestration. I come from the 17th Congressional 
District of Pennsylvania where we have the Tobyhanna Army Depot 
which employs 5,200 people, about 430 of whom are getting pink 
slips, all of the rest of whom are being given furlough 
notices.
    These are people who for the last three years have not had 
a raise, people who have diligently and faithfully been 
performing their jobs, supporting the Armed Forces of the 
United States and now are being told that they have to take a 
further pay cut of 20 percent just because the people in 
Washington can not come together and solve this.
    For anyone to say that this is crying wolf, they are sorely 
mistaken because people, real people, are suffering because of 
this sequestration.
    Also to say that nothing has happened despite Republican's 
efforts is also a complete fallacy. Two bills were passed by 
House Republicans last Congress and both bills died with the 
Congress. House Republicans who are in charge of the United 
States House of Representatives right now have not acted this 
Congress to avert sequestration.
    Congress passed the Budget Control Act of 2011 which 
required across-the-board cuts to each program, project and 
activity within each budgetary account in the event that 
Congress failed to enact deficit reduction legislation. 
Agencies are further limited to implementing these 
congressional-mandated cuts by longstanding laws that Congress 
uses to enforce its power of the purse. Together, Federal 
agencies cannot avoid consequences like employee furloughs or 
the disruption of services on which Americans depend.
    For example, USDA furloughs, even if they are not on 
consecutive days, really matter because when there is no USDA 
inspector in a meat packing plant, that plant has to close 
down, cannot process beef, cannot process meat. It is a big 
deal to the American economy when there is no USDA meat 
inspector on the job.
    Now today, we are fortunate enough to have representatives 
from the Federal Communications Commission, the Department of 
Agriculture and the Department of Commerce discussing 
sequestration. These agencies are each losing valuable funding 
as a result of these blind cuts. The FCC is losing $17 million, 
resulting in possible furloughs in the future. These cuts are 
going to create hiring freeze at a time when people need jobs 
the most, reducing the ability to monitor the airways.
    The Department of Commerce will see significantly greater 
reductions than the FCC with cuts of $551 million. The Economic 
Development Administration will be cut by $13 million at a time 
when economic development should be our focus.
    Sequestration will also result in thousands of lost or 
unfilled jobs at the National Oceanic and Atmospheric 
Administration. No matter what a member thinks about a manmade 
climate change, NOAA is responsible for weather forecasts and 
warnings of natural disasters like Hurricane Sandy which 
impacted my District and millions of people across the Country. 
It is irresponsible and dangerous to cut a program that gives 
critical and lifesaving advanced warnings of impending 
disasters.
    In fact, these consequences are just what was intended. In 
2011, House Speaker Boehner emphasized these across-the-board 
cuts in a meeting of the GOP Conference in an effort to win 
Republican support for an extension of the Nation's debt limit. 
Recently, Republican members have repeated their support for 
across-the-board cuts labeling the cuts a victory and the best 
thing that has happened since they came into office.
    I am here to tell you, last week in my District the Greater 
Wilkes-Barre Chamber of Commerce, which represents many 
businesses and business owners in my District, wrote a letter 
to me to express their disappointment with the chilling effect 
that sequestration will have. They wrote whether is it the 
thousands of jobs at the Tobyhanna Army Depot and their 
subcontractors, small businesses aching for a forward-moving 
economy, school children or those most in need in our 
community, the cuts will be felt across the board.
    They get it. The whole Country gets it. Across-the-board 
cuts to every Government project, program and activity can only 
be stopped by Congress. I urge Republican leadership to come to 
the table and put a stop to this ridiculous, ridiculous 
sequester.
    Mr. Farenthold. Thank you very much, Mr. Cartwright.
    I would like to ask unanimous consent at this point to 
enter into the record an article from Politico ``Now Dems 
Worry, Did President Obama Cry Wolf?''
    Without objection.
    Mr. Farenthold. Without objection, members will also have 
seven days to submit their opening statements for the record.
    Now, we are going to go to our panel. Let me introduce the 
panel first.
    First, we have Mr. David Robbins. He is the Managing 
Director of the Federal Communications Commission. Welcome, Mr. 
Robbins.
    Mr. Michael Young is the Director of the Office of 
Budgetary and Program Analysis at the U.S. Department of 
Agriculture.
    And Mr. Hari Sastry, who is the Deputy Assistant Secretary 
for Resource Management at the Department of Commerce.
    Pursuant to the committee rules, all witnesses will be 
sworn in before they testify. Would you please rise with me?
    Please raise your right hand. Do you solemnly swear or 
affirm that the testimony you are about to give will be the 
truth, the whole truth and nothing but the truth?
    [Witnesses respond in the affirmative.]
    Mr. Farenthold. Let the record reflect that all witnesses 
answered in the affirmative. You may be seated.
    I know each of you has submitted written testimony but in 
order to allow for timely discussion, especially as we have 
votes coming up this afternoon, we would like to ask you to 
summarize that and try to keep your statements within five 
minutes. You have a red, green and yellow light in front of 
you. It works just like the numerous traffic lights on the 
streets here in Washington, D.C. Your entire testimony will be 
entered into the record and available for review.
    So we will start first with Mr. Robbins from the FCC.

                       WITNESS STATEMENTS

                   STATEMENT OF DAVID ROBBINS

    Mr. Robbins. Good afternoon, Chairmen Farenthold and 
Jordan, Ranking Members Lynch and Cartwright and other Members 
of the Oversight and Government Reform Committee. It is an 
honor to be here with you this afternoon.
    My name is David Robbins and I am the Managing Director of 
the Federal Communications Commission. My core role is to 
ensure that the Commission's resources are allocated and 
utilized properly and to manage the staff that supports the 
FCC's programs.
    I joined the Commission on September 2, 2011 after serving 
as the SBA's Associate Administrator for Management and 
Administration. Prior to that, I worked at the FTC as an 
Assistant Director in the Bureau of Consumer Protection. I also 
have more than 15 years in the private sector.
    I feel privileged to serve as a public servant in an agency 
with such important responsibilities. The information and 
communications technology sector, also known as the broadband 
economy, is a growth and job creation engine. The Commission's 
work to unleash wireless spectrum, extend the benefits of 
broadband to all Americans, protect and empower consumers, 
promote competition and ensure public safety is critical to our 
economy and society.
    But I also recognize that these are challenging budgetary 
times for all Federal agencies. The FCC is a small, independent 
regulatory agency and we already have a very lean budget, even 
less than in some prior years, and we currently have our lowest 
FTE level in more than 30 years. The Commission's activities 
are completely fee-funded by our licensees, and these licensees 
will pay the same amount to the FCC regardless of whether the 
monies to go the Treasury for sequestration purposes or for 
agency operations.
    To better understand the challenges we face, it is 
important to review our general budget situation. For Fiscal 
Year 2013, the FCC requested $246 million, with $8.8 million 
specifically dedicated to the Office of Inspector General. Our 
Fiscal Year 2012 Appropriation, including OIG funds, was $339 
million and the current CR provides $341 million to the agency. 
Sequestration requires a 5 percent cut or $17 million from the 
FCC's regular budget, which would result in the OIG cut of 
$490,000 and the non-OIG cut of $16 million.
    In addition, we have limited spending flexibility for a 
broad range of programmatic needs outside of fixed costs. Our 
compensation and benefits are a large part of our fixed costs, 
at about 72 percent, followed by rent, utilities and a portion 
of our contracts which together make up another 23 percent. 
That means that roughly 95 percent of our budget is committed 
to expenditures that are difficult to change quickly, leaving 
us with limited options from which to address these cuts.
    So our starting point for flexible budget cuts is lower 
than would first appear. With a budget this small and targeted, 
there is not sufficient room to reprioritize during the year to 
ensure that we can handle contingencies and emergencies that 
may come up.
    The Commission processes over 375,000 applications a year, 
including 16,000 equipment authorizations, and reviews over 
300,000 consumer complaints and inquiries in addition to 
handling a broad range of issues related to public safety and 
homeland security, as well as universal service reform.
    It is important to note that much of what we do is highly 
technical and dependent upon a skilled workforce of engineers, 
economists, attorneys and other experienced professionals. For 
that reason, our budget is workforce intensive and it is for 
that reason that we are taking every reasonable measure to 
minimize the risk of furloughing our employees. But that does 
not mean that we will not be forced to furlough at a later date 
to ensure that the agency accomplishes its mission.
    As we move forward, the FCC will be instituting cuts in 
every part of our budget in order to ensure that we reach the 
goal of $17 million in cost reductions. These cuts will affect 
every part of our operation, including the compensation and 
benefits we pay our employees, the rent and utilities we pay to 
occupy and operate our various facilities, the contracts and 
agreements that we utilize to purchase goods and to provide 
vital services to the agency, the myriad of administration 
costs that all organizations have in running their day-to-day 
operations, the services we provide to licensees and consumers, 
and the work we do to fulfill our public safety and homeland 
security missions and to advance Congressional Directives such 
as universal service.
    We are working hard to balance the cuts necessitated by 
sequestration with the need to ensure that our licensees, 
consumers, stakeholders and everyone with an interest in the 
communications industry receives the highest level of services 
from the employees that are on staff.
    With roughly 95 percent of our budget going to our 
workforce, rent, utilities and contracts, it will be a 
difficult task to find the $17 million of cuts required under 
sequester without adversely impacting our workforce and the 
mission of the agency.
    Thank you for this opportunity to testify here today and I 
will be please to answer your questions.
    [Prepared statement of Mr. Robbins follows:]

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    Mr. Farenthold. Thank you very much, Mr. Robbins.
    We will now proceed to Mr. Young from the USDA.

                 STATEMENT OF MICHAEL L. YOUNG

    Mr. Young. Thank you, Mr. Chairman.
    Mr. Chairmen, Ranking Members and Members of the 
Subcommittees, my name is Michael Young. I currently serve as 
the Director of the Office of Budget and Program Analysis which 
is essentially the Department's central budget office. I have 
been in this position for just over two years but essentially I 
have served nearly my entire career within the office in 
various other positions.
    The 2012 budget for the Department of Agriculture was about 
$152 billion which made it the fifth largest budget in the 
Federal Government. As I mention in my written statement, the 
Department manages a very wide range of programs including 
nutrition assistance, food safety, conservation, research and, 
of course, the farm programs. Based on the annual appropriation 
acts, farm bills and other authorizing statutes, USDA has an 
extensive and detailed account structure.
    In terms of the sequester, the Balanced Budget Statute 
exempts several of the Department's larger programs from 
sequestration. These exemptions include the Supplemental 
Nutrition Assistance Program, the Child Nutrition Program, the 
Conservation Reserve Program and most of the Federal Crop 
Insurance Program, among others.
    For the programs that are not exempt, the sequestration 
order signed by the President on March 1st requires a reduction 
of 5 percent to the discretionary funds and 5.1 percent to the 
mandatory funds. For the Department of Agriculture, that 
translates into a reduction of almost $2 billion.
    The statute provides requirements on how the reductions are 
to be calculated by the Office of Management and Budget and 
allocated across the Department's programs, projects and 
activities. OMB calculates the sequestration percentage that 
applies to each account and has now sent a report to the 
Congress showing those amounts.
    The statute then requires that the reductions be applied 
equally to each PPA, each program, project and activity, within 
a budget account. Applying the definitions in the statute, USDA 
has identified over 920 PPAs in more than 110 separate 
accounts.
    At USDA, we began the process to identify these PPAs and 
apply the Balanced Budget Act special rules on exemptions back 
in December of 2011. This became a longer term process and 
certainly intensified during the summer of 2012. This process 
has involved significant effort, working closely with agency-
level budget officers, the Office of the General Counsel and 
the Office of Management and Budget.
    Following this effort, agencies have been responsible for 
planning how to implement the sequestration given their 
specific account structure and the PPAs within those accounts. 
As the agencies move forward, the Secretary has asked them to 
implement sequestration in an equitable and fair manner and in 
the least disruptive manner possible that protects the ability 
to perform the USDA mission to the extent possible.
    However, depending on the specific structure of an agency's 
accounts and the laws applicable to those accounts, more or 
less flexibility may be available to minimize the impact of the 
reduction.
    To that end, I described in my written statement an example 
where the Department could use a limited transfer authority 
that we have which allows for transfers of up to 7 percent 
among accounts within an individual USDA agency. As an update, 
I would just note for the Committee that the Secretary 
announced earlier today his intention to use this limited 
transfer authority to reduce the disruptive impacts of the 
sequester in some of the farm payment programs.
    In contrast, as members are likely aware, the Food Safety 
and Inspection Service identified a need to furlough employees 
for an estimated 11 days as a result of the sequester. However, 
the interchange authority would not assist FSIS in addressing 
its shortfall because there simply are no other accounts from 
which that agency could transfer funds to offset a shortfall.
    Mr. Chairman, that is a very brief overview of some of the 
work underway at the Department of Agriculture to implement the 
sequester. I would be glad to respond to the questions you and 
members of the subcommittees may have.
    [Prepared statement of Mr. Young follows:]
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    Mr. Farenthold. Thank you for your testimony, Mr. Young, 
and I applaud your administrators' efforts to make this as 
painless as possible.
    We now go to Mr. Sastry from the Resource Management 
Department at the Department of Commerce.
    You are recognized for five minutes, sir.

                    STATEMENT OF HARI SASTRY

    Mr. Sastry. Mr. Chairman, Members of the Committee, I want 
to thank you for inviting me to this hearing on the impact of 
sequestration on the Department of Commerce.
    We appreciate your interest in protecting the Department's 
mission and the many services we provide to the American 
public. The Department values the Joint Subcommittees' 
oversight role and is committed to working with you on this 
important issue.
    Before getting into the impacts, I would like to give you a 
few words about my background. I spent 13 years as a career 
civil servant under both Republican and Democratic 
Administrations, 11 of those years were at the Office of 
Management and Budget as both a program analyst and branch 
chief working in the area of Veterans Affairs and Defense 
Health.
    For nearly two years, I have worked at the Department of 
Commerce as a Deputy Assistant Secretary for Resource 
Management. My responsibilities include aligning the 
formulation and execution of the budget with the Department's 
policy priorities. I also lead the Departments' Enterprise Risk 
Management.
    As you know, the President was required by law to issue a 
sequestration order on March 1, 2013. As a result of this 
action, approximately $85 billion in budgetary resources across 
the Federal Government were canceled. Of that, $567 million 
were canceled within the Department of Commerce, which include 
$16 million from the Sandy Supplemental. For our larger 
bureaus, sequestration means budget cuts of $270 million to 
NOAA, $46 million to the Census Bureau, and $38 million to 
NIST.
    In planning for and applying the cuts required by 
sequestration, our primary focus has been on protecting our 
mission. However, no amount of careful planning can mitigate 
the short-and long-term effects these cuts will have on the 
Department's ability to deliver on critical parts of our 
mission to serve the public.
    Sequestration is unprecedented and the planning process has 
been confounded by the fact that we are currently operating 
under budgetary uncertainty with the current CR. Communities 
will feel the impacts as we are forced to reduce grants to 
States, localities and universities as well as renegotiate and 
potentially terminate contracts with private sector firms.
    Our bureaus are already feeling the impacts as we are 
forced to implement hiring freezes, curtail or cancel training, 
and halt critical program investments. While we have worked 
hard to manage the challenges of sequestration as best we can 
within the context of this Fiscal Year, the longer it is in 
effect the more our ability to accomplish the Department's 
mission is degraded.
    There is not a one-size-fits-all approach to this planning 
and, just have you have seen differences across departments, 
there are differences among our bureaus as well. The Department 
of Commerce is extremely diverse, both in terms of the mission 
we administer and the populations we serve, as well as the 
makeup of our budget and the challenges posed by sequestration. 
Planning has been complex and we are continually refining our 
efforts as we work to protect our mission under sequestration.
    Let me give you one quick example. Our Geostationary 
Operational Environmental Satellite, or GOES-R Program, is a 
critical component of our weather forecasting and will be one 
of the primary tools for the detection and tracking of 
hurricanes and severe weather. In order to maintain the current 
schedule to launch the first satellite in 2015, this program 
requires a $186 million increase in 2013.
    Based on the information available to us, we initially 
projected a two to three year slip in launching the first GOES-
R satellite. However, recently the House passed a CR supporting 
this program with significant increases and the Senate is due 
to follow suit. We will now adjust our plans to factor in these 
new possible funding levels. This is just one example of how 
the uncertainty drives continual updates and changes to our 
planning efforts.
    Current law requires that all agencies submit operating 
plans by March 31st, but the passage of the CR under debate 
would amend that date and also change our projected funding 
levels. In the meantime, recognizing that the situation is 
still in flux as Congress completes its work, I am happy to 
answer your questions as best I can.
    [Prepared statement of Mr. Sastry follows:]
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    Mr. Farenthold. Thank you very much, Mr. Sastry.
    Just as a matter of housekeeping, we are expecting votes in 
the House of Representatives in about five minutes on a couple 
of procedural matters in the rule for considering the budget. 
We will start. I will do a five minute round of questions, we 
will let Ms. Norton do a five minute round of questioning, and 
then we will take a recess and reconvene here immediately after 
the votes to allow the other members who have questions the 
opportunity to ask questions. But, obviously our first 
responsibility is to vote on the matters on the Floor of the 
people's House.
    So with that, I will recognize myself for five minutes of 
questioning.
    Mr. Sastry, we will start with you. You were talking a 
little bit about the two NOAA satellites. I understand there 
has also been some problems with scheduling and management with 
these two satellites since 2007 when the Commerce IG issued a 
critical report. Is it really fair to blame the sequester for 
the problems with these satellites?
    Mr. Sastry. These satellites are critical to our weather 
forecasting capability which the Department takes very 
seriously. We have worked very closely with the IG on the 
issues that they have brought up going forward and we consider 
that a strong partnership.
    Mr. Farenthold. Well, the problem is that we have been 
struggling with these for a long time.
    I also understand that your staff told this Committee that 
you would be testifying here reluctantly because you don't 
think you are in a good position to describe DOC's 
sequestration impacts with certainty. So I want to ask you, are 
you aware of page four of the February 8th letter from Deputy 
Secretary Rebecca Blank to the Senate Appropriations Committee 
Chairman outlining some of the impacts of sequestration on the 
Department of Commerce?
    Mr. Sastry. Yes, I am.
    Mr. Farenthold. Are you also aware that the letter 
referenced at least some of these sequester impacts as certain?
    Mr. Sastry. Yes.
    Mr. Farenthold. But today you are still not able to give us 
a great degree of certainty. What has changed between then and 
now?
    Mr. Sastry. When we responded to the Chairwoman's letter in 
early February, we had a set of assumptions and a set of 
estimates based on the information we knew at that time. Since 
then, we have had several changes that occurred from the Sandy 
Supplemental to the House CR to the Senate CR. Each of those 
required us to continually update our planning efforts.
    Mr. Farenthold. All right. I am going to request that we 
enter that February 8th letter into the record. Without 
objection, so ordered.
    Mr. Young, let's talk a little bit about the USDA. One of 
my ongoing concerns is, and I mentioned it in my opening 
statement, is that we are trying to make this as painful as 
possible on people and I don't think that is appropriate coming 
out of the White House or the agencies.
    I am an old radio guy. Mr. Robbins could probably look up 
when I first got my FCC license, assuming their computers work. 
But you all have spent in the past couple of years just a ton 
of money, a Hungry Pest Campaign, $942,200 for a marketing 
campaign, and a Save Our Citrus Campaign, I have actually heard 
those PSAs, and spent $200,000 to produce some PSAs.
    Now, as an old radio guy, that is a lot of money to produce 
a PSA. I checked with the station I used to work for. They are 
running them for free. If you all want to do some more, I will 
do them for free in my office for you.
    It just seems like we ought to be able to find some of 
these savings in these contracts or in other areas without 
laying off some people. Don't you think we might be able to do 
that? There is also one, the question here says I am supposed 
to ask you about a Smokey the Bear statute. Having heard the 
PSAs, I realize it is not Smokey the Bear, it is Smokey Bear. 
Do you think we could maybe save some money on this production?
    Mr. Young. Sir, I am not specifically familiar with the 
items that you mentioned. However, I would note that most of 
those, the Smokey Bear item would be in the Forest Service, 
they are not projecting to have a furlough, and the others 
sound as though they may be in the Animal and Plant Health 
Inspection Service, and they also are not planning a furlough.
    Mr. Farenthold. So I think in your testimony you said you 
have a 7 percent ability to move around those cuts. Why are we 
just getting to this now when we have known about sequestration 
for a year?
    Mr. Young. Yes, sir. The authority that we have, it is 
called the Secretary's Interchange Authority, and that allows 
for the Secretary to transfer up to 7 percent from one account 
within an agency to another account within that same agency. It 
is not available to the Forest Service due to a proviso in the 
Interior Appropriations.
    Mr. Farenthold. So, would you all be better off if we were 
to do an Ag Appropriations Bill and get it through the Senate 
and operating under a CR?
    Mr. Young. It would provide more certainty, certainly, for 
operations.
    Mr. Farenthold. All right. And let me get to Mr. Robbins 
before I am out of time.
    You said the FCC, with a really tight budget, it looks like 
you probably are going to be able to pull this off without 
furloughs. I applaud you for that and hope you can do it. When 
did you all start planning for this?
    Mr. Robbins. Sir, at the FCC, my teams spend a lot of time 
all of the time trying to make sure we are managing our budget 
well. So, sequestration, which we knew passed back in 2011, we 
have been working hard to ensure that from hiring to contracts 
to every part of our budget that we are managing the funds we 
have been given appropriately.
    Mr. Farenthold. So regardless of the OMB letter saying do 
not worry about sequestration, you all followed my 
grandmother's advice and planned for the worst and hoped for 
the best.
    All right. I see I am out of time. I will now recognize the 
gentlelady from the District of Columbia for 5 minutes and 30 
seconds.
    Ms. Norton. Mr. Chairman, I defer to the Ranking Member of 
the Full Committee, Mr. Cummings.
    Mr. Cummings. I want to thank the gentlelady for yielding.
    When you cut $85 billion out of a budget over a course of 
seven months, there are consequences. Duh. Mr. Chairman, In 
today's hearing, the Majority wants people to believe that the 
across-the-board cuts that are coming are a choice made by the 
Administration and that the Administration has alternatives to 
cutting everything.
    To our witnesses, is it not true that by law sequestration 
means across-the-board cuts to every program, project and 
activity? Please answer, gentleman, I do not have a lot of 
time. Go straight across.
    Mr. Sastry. Yes.
    Mr. Cummings. Yes.
    Mr. Young. Yes.
    Mr. Cummings. Yes.
    Mr. Robbins. Yes.
    Mr. Cummings. Yes. Thank you.
    The phrase ``program, project and activity'' that is a 
direct quote from the Budget Control Act of 2011 that the 
Congress, we did that, which means the most granular and 
specific level of spending. Is that right? Is that correct? 
Quickly, gentlemen.
    Mr. Sastry. Yes.
    Mr. Young. Yes, sir.
    Mr. Robbins. Yes.
    Mr. Cummings. So the law says, the law that we created, we 
created this now, says that Federal agencies must make across-
the-board cuts to everything, and Congress writes the laws. 
Now, some in the Majority have recently asserted that Federal 
agencies have the power to reprogram and transfer funds away 
from wasteful or duplicative purposes to more meritorious ones 
and in that way they can undo the across-the-board cuts caused 
by the sequester. My, my, my.
    For instance, Chairman Issa sent letters to the Federal 
agencies seeking suggestions for specific program reductions 
for elimination ``that would be more beneficial to the American 
people than the across-the-board sequestration.'' The letter 
suggests that agencies have flexibility to not make cuts across 
the board but rather selectively cut ``wasteful spending'' to 
achieve the congressionally-required reductions in spending.
    Now, to our witnesses, sequestration has imposed a 13 
percent across-the-board cut to everything in the Defense 
Budget and a 9 percent reduction to everything in the non-
Defense budget. Do you have legal authority to restore, by 
reprogramming or transferring funds, those cuts right now 
without prior authorization from us, the Congress?
    Mr. Sastry. No.
    Mr. Young. Sir, we have the authority as I described.
    Mr. Cummings. That 7 percent that you talked about?
    Mr. Young. Yes, the 7 percent. But that does require us to 
notify the Appropriations Committees 30 days in advance of 
making such a transfer.
    Mr. Cummings. And you, sir?
    Mr. Robbins. No, sir.
    Mr. Cummings. Is it not true that each of your agencies is 
restricted by appropriation acts and authorizing statutes from 
reprogramming or transferring funds to a degree necessary to 
completely restore the across-the-board cuts that sequestration 
requires?
    Mr. Sastry. We cannot transfer that much. That is correct.
    Mr. Young. Again, just with the caveat on our specific 
authority.
    Mr. Robbins. I would just note the FCC has really one 
account. As a small agency, we are a bit different than the 
others who are testifying.
    Mr. Cummings. And how is that? Talk to me.
    Mr. Robbins. We have one account.
    Mr. Cummings. Okay. All right. So, the law that Congress 
wrote, that we wrote, we wrote this, now, requires everything 
to be cut under sequestration and the laws that Congress wrote 
restrict Federal agencies from restoring those cuts on their 
own without new authority from Congress. In other words, 
Congress is responsible for creating across-the-board cuts and 
for enforcing them. That is just what the House Republicans 
intended all along.
    In 2011, House Speaker Boehner emphasized that the price of 
extending the Nation's debt limit would be across-the-board 
cuts we are now seeing. Will staff put up the slide? Here is a 
slide created by Speaker Boehner to use in his presentation to 
the House GOP Conference in July, 2011. He used this slide to 
convince the GOP Conference to go along with an extension of 
the debt limit and avert default.
    Look at what it says: ``A new sequestration process to cut 
spending across the board and ensure that any debt limit 
increase is met with greater spending cuts.'' The only reason 
the House of Representatives voted to steer the Country away 
from the first financial default in its history was Speaker 
Boehner's promise that across-the-board cuts to everything 
would follow and would not be reversed.
    With that, I see my time is out.
    Mr. Farenthold. Thank you very much.
    And, as we are in votes now in the House of 
Representatives, we will take a recess. It will probably be 
around a half an hour or so that we will be gone for votes. We 
will reconvene as soon as votes are over. I am not going to 
give you a specific time. You all are welcome to move back to 
the Majority Lounge and make yourselves comfortable. We will be 
back and we appreciate your patience as we do the people's 
business.
    So, without objection, we are in recess.
    [Recess.]
    Mr. Farenthold. At this point, I think we are on the 
Republican side of the aisle so we will recognize Dr. 
DesJarlais, the gentleman from Tennessee, for five minutes.
    Mr. DesJarlais. Thank you, Mr. Chairman, and bear with me 
while we gather our thoughts here. It was a short interruption.
    Mr. Young, how did you interpret a July 31, 2010 OMB memo 
about the potential for sequestration and instructed agencies 
to continue normal spending and operations since more than five 
months remain for Congress to act? Did you follow that?
    Mr. Young. Well, sir, I would say that agencies did 
continue to have their full funding available. But I would 
indicate that a number of agencies had been taking actions to 
take reductions in various areas. I would say that a couple of 
the agencies, a few of the agencies, had closed a number of 
field offices and taken some other actions to reduce their 
spending.
    Mr. DesJarlais. So you are saying that you did prepare for 
this?
    Mr. Young. Yes.
    Mr. DesJarlais. Okay. According to USA Jobs last week, the 
USDA is advertising 152 open positions while at the same time 
announcing the furloughs of meat inspectors. Some of these open 
positions are things such as a visitor service information 
assistant at a salary of $31,000, a position for a liaison 
specialist with a salary of $47,000, Pathways intern student 
trainee salary $44,000 and so on, an agriculture commodity 
grader with a salary of $69,000. Why is the USDA advertising 
open positions for food inspectors while planning to furlough 
inspectors?
    Mr. Young. Well, it sounds like a number of those titles 
that you read off there would likely be in other agencies. I 
know that the Food Safety and Inspection Service that employs 
the meat and poultry inspectors has had a hiring freeze on for 
positions that are not in their frontline inspection system. I 
think those would possibly be positions in other agencies. I am 
not familiar with the specific ones that you mentioned but they 
may well be in other agencies that are not planning furloughs.
    Mr. DesJarlais. Okay. So a position for a food inspector, 
salary $50,000, is that not in the same department as the meat 
inspectors?
    Mr. Young. That could be in the Food Safety and Inspection 
Service. I do not know the specifics regarding that instance. I 
would be happy to look into it for the record.
    Mr. DesJarlais. Okay, so you are saying that the 152 jobs 
that are advertised just as of last week should not impact the 
plans to furlough meat inspectors?
    Mr. Young. No, sir, because I am guessing again to the 
extent that those positions are in other agencies, we just 
would not have any means to shift the funds from those other 
agencies to avoid the FSIS furloughs.
    Mr. DesJarlais. Okay. How is it prioritized, how is the 
USDA prioritizing its furloughs? For example, is USDA 
prioritizing cutting conference and travel costs over 
furloughing employees and if so, how?
    Mr. Young. Yes, there have been reductions in both travel 
costs and conference spending.
    Mr. DesJarlais. What are they cutting in terms of 
conference and travel spending?
    Mr. Young. I may be able to get you a number here. From 
2010 to 2011, we reduced the number of conferences by 76 and 
the cost by $6.4 million.
    Mr. DesJarlais. Okay. Let's talk about bonuses. I 
understand the USDA spent $33 million on bonuses for employees 
in Fiscal Year 2011. Did you issue bonuses in Fiscal Year 2012?
    Mr. Young. Yes. I know that some agencies did.
    Mr. DesJarlais. Okay, so $33 million in 2011. How much in 
2012?
    Mr. Young. I am not sure that I have that information with 
me today. I would be happy to get that for the record.
    Mr. DesJarlais. Were they awarded for food inspectors?
    Mr. Young. I would have to check on that, sir.
    Mr. DesJarlais. And you would not know how much then?
    Mr. Young. No, sir.
    Mr. DesJarlais. Okay. With sequester looming, do you think 
it is responsible budgeting to hand out bonuses?
    Mr. Young. As I understand, there is guidance that we will 
not be issuing bonuses at this time.
    Mr. DesJarlais. So you don't plan on doing that this year?
    Mr. Young. Other than those that are, any that might be 
required by law.
    Mr. DesJarlais. There are laws that require bonuses?
    Mr. Young. Apparently. That would be a little bit out of my 
bailiwick. It is probably more in the Human Resources area.
    Mr. DesJarlais. Thank you, Mr. Young.
    Mr. Jordan. [Presiding] I thank the gentleman. I will now 
yield to the gentlelady from the District of Columbia, Ms. 
Norton.
    Ms. Norton. Thank you, Mr. Chairman. I just want to clarify 
that my good colleague on the other side indicated, and it is 
very important, these differences, that the OMB indicated that 
you should continue to spend at normal rates because we were 
five months away from the sequester.
    I would have hoped that you would spend at normal rates 
because normal rates would have meant that we were already into 
a 10-year spending reduction that had been required to avoid 
the debt ceiling debacle. So, you were already in a cut mode 
and, as you have just replied, spending at normal, to be sure 
cut rates, did not imply that you were not planning for what 
would happen in case of sequester.
    But if I may say so, I would have thought that the American 
people and many of us here would have thought that the 
sequester would not occur because it is among, you look at the 
annals of Congress, perhaps falls into, outside of what 
Congress has done even in its most insane moments.
    It has been suggested that you could find savings in, I 
don't know, Smokey Bear, and that it looks like the President 
is trying to indeed make the sequester as painful as possible. 
The last time I heard, that was the point of sequester. It was 
a hammer so painful that responsible members of Congress would 
never engage in it. But it was not something that the President 
was supposed to do, it was something that the sequester said 
you will do if you do not make the cuts in a balanced way or in 
a way that both sides can agree.
    Now, I just want to clarify, therefore, when it says why 
are you not finding savings here, there and the other place 
that would be more sane to cut than, for example, meat and 
poultry plant inspection personnel, suppose you, this goes to 
any of the three of you, suppose you had found an 
administrative level, two or three administrative employees, 
that would be easier to cut than poultry inspectors, easier in 
the sense that you could do without them, to use that example, 
more easily without that layer of administrative cutting 
corners, to be sure, than you could do without poultry 
inspectors.
    Could you have made, even if you found that level of 
savings needed in administrative positions, could you have made 
that choice under sequester? Could I have your answers?
    Mr. Robbins. I think for the FCC, we have been managing our 
head count and our FT very carefully for quite some time. We 
subject every hire we do to a careful scrutiny. There is no 
automatic backfills. I suppose the answer for the FCC would be 
yes, although as I have mentioned earlier, while we are not 
currently planning to do furloughs, it is something that we 
cannot take off the table.
    Ms. Norton. Well, Mr. Robbins, I want to ask you about the 
FCC because your agency, I believe, is not funded by the 
American people as much as by regulatory fees. Is that the 
case?
    Mr. Robbins. Yes, it is.
    Ms. Norton. So those fees are paid by business?
    Mr. Robbins. Correct.
    Ms. Norton. Well, how are you subject to the sequester?
    Mr. Robbins. Sequestration applies to the regulatory fee 
funded portion of the agency.
    Ms. Norton. So what happens? Do those who owe the funds, 
which are necessary of course to carry out the functions of the 
agency, do they get a break from paying the fees?
    Mr. Robbins. No, they do not.
    Ms. Norton. Where do those funds go?
    Mr. Robbins. Those fees will be collected, as required by 
our appropriation, and placed over at Treasury.
    Ms. Norton. Could I ask, in Agriculture we hear that there 
may well be the need for fund cuts, but not at FCC. Is this 
because some agencies are more labor intensive than others? It 
is not very pleasant for the American people who have seen some 
food scares in the last years to hear that plant, that poultry 
and meat inspectors could be cut.
    What is the difference between these two agencies, one 
perhaps not needing furloughs, the other, Mr. Young, needing 
furloughs?
    Mr. Young. Well, I am not familiar with the specifics of 
the FCC.
    Ms. Norton. No, just discuss your agency, Mr. Young.
    Mr. Young. In terms of our Food Safety and Inspection 
Service, I would note that about 80 percent of that budget is 
devoted just to salaries and benefits, another 15 percent of it 
is spent on support activities for the frontline inspection 
process. And so, that essentially leaves very little 
flexibility.
    Ms. Norton. So it is labor intensive.
    Mr. Young. Very labor intensive, yes, madam.
    Ms. Norton. Does it have an effect upon the businesses you 
deal with?
    Mr. Young. If the inspectors are furloughed, those plants 
would not be able to sell their product in commerce.
    Ms. Norton. And if I just may see the difference then with 
Mr. Robbins whose fees comes from business and who believes 
that he may not have to do furloughs, the reason for that is, 
besides making savings before the sequester set in, are there 
any particular reasons based on the nature of the Commission?
    Mr. Robbins. Just as my colleague, Mr. Young, had the 
difficult time time knowing what the difference between our 
agencies are, I also have the same problem. I would say for the 
FCC we have been trying to be careful stewards of the dollars 
that you have given us.
    Ms. Norton. What kind of cut have you taken so far?
    Mr. Robbins. Our cut will be $17 million under 
sequestration.
    Ms. Norton. What percentage is that of your budget?
    Mr. Robbins. So, as a percentage of the budget it is 5 
percent.
    Ms. Norton. No, I am talking about before sequestration. 
You said you had been taking cuts and making savings before 
sequestration. That was part of the point I made earlier, that 
cuts were already in existence.
    Mr. Robbins. I would say we have been carefully managing 
our budget and that has included being careful about how we 
hire people. So we are at a 30-year low right now as well as 
finding savings in every other part of our budget.
    Ms. Norton. Thank you, Mr. Chairman.
    Mr. Jordan. Thank you. I recognize the gentleman from 
Arizona, Mr. Gosar.
    Mr. Gosar. Thank you very much, Mr. Chairman, and I thought 
sequestration was a backstop to have responsible Government, 
not to make it painful to the American people but have 
responsible Government. I think that is the first think I would 
like to address to the gentlelady.
    But my question for you, Mr. Young, is this the first time 
that we have gone through sequestration?
    Mr. Young. No, sir. I believe that there were 
sequestrations in the late 1980s and perhaps in 1990.
    Mr. Gosar. Let me ask you a question. Did you think it was 
going to go through?
    Mr. Young. Well, we certainly realized that it was a 
potential, yes, sir.
    Mr. Gosar. How about you, Mr. Sastry?
    Mr. Sastry. We also thought there was a potential that it 
would go through.
    Mr. Gosar. Now, my understand is it is a two-way street, 
that you can also ask Congress in regards to making these cuts 
a little bit different. Is that not true, Mr. Sastry? That it 
is a two-way street in communication in regards to 
sequestration, is it not?
    Mr. Sastry. This sequestration law itself had very limited 
flexibility.
    Mr. Gosar. But you can ask Congress to give you that 
flexibility, can you not?
    Mr. Sastry. We can request reprogramming.
    Mr. Gosar. Yes, you can. Did it ever come from your agency? 
It did not. How about you, Mr. Young?
    Mr. Young. Yes, sir.
    Mr. Gosar. You actually wrote a letter in regards to this?
    Mr. Young. We, the Secretary did just sign a letter this 
morning with regard to transferring some funds within our Farm 
Service Agency.
    Mr. Gosar. No, but I am asking you did you petition 
Congress in regards to having some more flexibility within the 
agency?
    Mr. Young. We----
    Mr. Gosar. You did not. How about you, Mr. Robbins?
    Mr. Robbins. As I mentioned earlier, the FCC only really 
has one account. And so, transferring funds is not the same 
issue for us.
    Mr. Gosar. Right.
    Mr. Jordan. Would the gentleman yield for one second?
    Mr. Gosar. Sure.
    Mr. Jordan. Mr. Young and Mr. Sastry, have you responded to 
Chairman Issa's letter asking you for ways that maybe we could 
work together and give you more flexibility? Have either of you 
responded to that letter?
    Mr. Sastry. I do know we received it and we are working on 
it, but we not yet responded.
    Mr. Jordan. You have not? Even though you have had 20 
months to get ready for this? Mr. Young?
    Mr. Young. Sir, we are also in the process of putting 
together the response.
    Mr. Jordan. Thanks. I yield back.
    Mr. Gosar. I appreciate that, Mr. Chairman.
    Let me ask you, Mr. Sastry, you are from OMB, right? Five 
years experience?
    Mr. Sastry. Previously, yes.
    Mr. Gosar. And do you follow the publication?
    Mr. Sastry. I am sorry, which publication?
    Mr. Gosar. Do you look over OMB waste, fraud and abuse 
within the agencies? Do you follow that at all? Have you looked 
that up recently?
    Mr. Sastry. The report from OMB on fraud and abuse?
    Mr. Gosar. Yes.
    Mr. Sastry. I have not read that report.
    Mr. Gosar. I am going to kind of pinpoint something for 
you. OMB actually looked at the prevailing wage and when they 
did an audit of the prevailing wage, more commonly known as 
Davis-Bacon, there was a 100 percent error rate in the 
calculations of it. And I want workers to be paid fairly. The 
majority of them are overpaid, heavily, on programs. But a lot 
of them were not paid adequately.
    Do you know that if we recalibrate the prevailing wage, 
which is, I think very prominent in Commerce, I know it is very 
prominent in Agriculture, I do not know about you, Mr. Robbins, 
but you would save tens of billions of dollars? What I would 
like you to do is look within your agencies and see that cost 
savings and report back to the Committee if we actually took 
and calculated the prevailing wage appropriately. Because I 
think it is a very pointed aspect in regards to OMB that could 
give us a lot of savings.
    But I am also going to ask you, you know, I am a private 
sector person. When you look at budgets, I mean, you have got 
to look at things that work and things that do not. You are 
always, and Mr. Robbins I want to compliment your stewardship 
of the taxpayer dollars, but I find it disdainful when we are 
not looking at programs and looking at managing those monies 
much better.
    Mr. Young, did you ever enter private business, sign the 
front end or back end of a paycheck?
    Mr. Young. I am sorry, sir, the question again?
    Mr. Gosar. Did you run a private business?
    Mr. Young. I have not run a private business.
    Mr. Gosar. How about you, Mr. Sastry?
    Mr. Sastry. No, I have not run one.
    Mr. Gosar. I would like that, hopefully that we would get 
some more principles of understanding in regards to public 
accountability of the public tax dollars.
    Mr. Speaker, I will just yield back the balance of my time.
    Mr. Jordan. I thank the gentleman. I now recognize the 
gentleman from Pennsylvania, the ranking member, Mr. 
Cartwright.
    Mr. Cartwright. Thank you, Mr. Chairman.
    The Administration did not decide to impose across-the-
board cuts to spending at Government agencies. It was Congress 
that did that, using Congress' power of the purse. And Congress 
also required Federal agencies to submit their sequestration 
plans 30 days after the President signed the Sequestration 
Order. He did that on March 1st, which means that the agencies 
here today are going to need to submit their plans by April 
1st. Now by my reckoning, Mr. Chairman, criticizing Federal 
agencies on March 19 for not having their sequestration plans 
that are due on April 1st is premature, to say the least.
    Unfortunately, Congress did not take into account the harm 
to businesses and individuals as a result of what I have called 
this ridiculous sequestration. Cutting the Federal Budget was 
not a means to an end but an end in itself. In some instances, 
cuts will result in furloughs, reduced benefits and disruptions 
to basic services.
    Mr. Young, it has been reported that furloughs will likely 
be necessary for meat and poultry inspectors, as I mentioned in 
my opening statement. Can you estimate the effect of these 
furloughs on the meat processing industry and other related 
industries?
    Mr. Young. Yes, sir. I have an estimate here of about $8 
billion if the furlough is in the range of the estimated 11 
days.
    Mr. Cartwright. And what has the USDA done in planning for 
this cut to minimize the impact on industry?
    Mr. Young. Well, we have, the agency has taken some steps 
to reduce their spending. I mentioned a couple of things in 
terms of reductions in travel and training, conference spending 
and that sort of thing, and having a hiring freeze for the non-
inspection related part of the agency.
    Mr. Cartwright. Thank you, sir.
    Mr. Sastry, across-the-board cuts are estimated to reduce 
your agency's ability to spur job creation and economic growth 
among America's private sector. Is that correct?
    Mr. Sastry. That is correct.
    Mr. Cartwright. And Mr. Robbins, the across-the-board cuts 
to FCC operations will impact economic growth and innovation in 
the communications sector. Am I correct in that?
    Mr. Robbins. It may very well do so.
    Mr. Cartwright. Now, I received a letter dated March 6, 
2013 from the Greater Wilkes-Barre Chamber of Commerce which 
represents more than 1,000 member businesses that serve my 
constituents in Northeastern Pennsylvania. At this time, I do 
ask, Mr. Chairman, for unanimous consent to make this letter 
dated March 6, 2013 part of the record.
    Mr. Jordan. Without objection, so ordered.
    Mr. Cartwright. Now, the chamber expressed their concern in 
this letter that these across-the-board cuts will have a 
chilling effect on our economy, slowing any further recovery, 
and it will be felt across the board. They wrote whether it is 
the thousands of jobs at the Tobyhanna Army Depot and their 
subcontractors, small businesses aching for a forward moving 
economy, school children or those most in need in our 
community, the cuts will be felt across the board. The only 
question is, who is responsible for undoing across-the-board 
cuts, Federal agencies or the U.S. Congress?
    And to these witnesses, I ask you, do you currently have 
the legal authority to reverse the magnitude of these across-
the-board cuts that this sequestration requires? Do you?
    Mr. Sastry. No, we do not.
    Mr. Young. Sir, I only have the one limited authority 
within a specific agency to move funds in between accounts but 
that does require the notification of the Appropriations 
Committee.
    Mr. Cartwright. Okay. Mr. Robbins? Do you have that 
authority?
    Mr. Robbins. No.
    Mr. Cartwright. Now, who wrote the laws that prohibit you 
from exercising flexibility to undo the effects of this 
sequestration? Who wrote that?
    Mr. Sastry. The Budget Control Act was written by Congress.
    Mr. Cartwright. It was Congress, was it not, gentleman?
    Mr. Young. Yes.
    Mr. Robbins. Yes.
    Mr. Cartwright. In the letter from my local Chamber of 
Commerce there is an explicit plea to members of Congress for 
both parties to work together and develop a solution that will 
not cripple our economy. They understand that solving the 
problems created by sequestration is Congress' responsibility. 
The whole Country understands that it is Congress that writes 
the laws and it is the law that mandated across-the-board cuts 
and it is the law that restricts Federal agencies from defying 
Congress' intent in the implementation of across-the-board 
cuts.
    Now, Mr. Chairman, I am glad to have this hearing on 
sequestration today but I respectfully believe that the 
Majority has really got it backward.
    Thank you.
    Mr. Jordan. I thank the gentleman.
    Mr. Robbins, when Congress passes a law, does it 
automatically become the law?
    Mr. Robbins. No, the President has to sign it.
    Mr. Jordan. Oh. I forgot. That is an important lesson that 
we all learned. Mr. Young, is that your understanding of how 
the law works? Once Congress passes something, does the 
Executive Branch, the President, have to sign it?
    Mr. Young. Yes, sir.
    Mr. Jordan. Yes. Mr. Sastry, is that how you understand how 
it works in America, too?
    Mr. Sastry. Yes.
    Mr. Jordan. And to your knowledge, the President signed 
this law, did he not?
    Mr. Robins. Yes.
    Mr. Jordan. He did? Imagine that. Mr. Young?
    Mr. Young. Yes.
    Mr. Jordan. Mr. Sastry?
    Mr. Sastry. Yes.
    Mr. Jordan. Okay.
    Let me start with you, Mr. Young. Do you think it is 
important that public officials speak plainly to the American 
people, talk straight with the American people, talk straight 
to the taxpayers and the folks that support this Government? I 
mean, that it is important for all public officials, anyone who 
works in our Government, that they should communicate in a 
straightforward way?
    Mr. Young. Yes, sir.
    Mr. Jordan. Okay. So, I want to try and understand some of 
the statements that have come from the Department. We had in 
December of last year Secretary Vilsack saying we may have to 
consider furloughs as a result of the sequester. And then a 
month later he said no, we are going to have to have 6,000 food 
safety inspectors furloughed for three weeks.
    And then if I look at your testimony, your written 
testimony from today, you say near the end of your written 
testimony that potentially we will need to furlough employees 
for up to 11 days because of sequestration.
    And so it seems to me the American people just want to know 
which one is it? Might happen, no, 6,000 for three weeks or 
potentially for 11 days. So, which one is that? Which one is 
actually the truth, if any?
    Mr. Young. The current estimate is that it may be for 11 
days. But I would just preface that by indicating that there is 
the uncertainty of the four-year funding situation and so, 
depending on where the funding comes out for the agency, that 
would then change.
    Mr. Jordan. And this is just in the Food Safety and 
Inspection Service part of your overall budget. Is that 
correct?
    Mr. Young. The 11 day furlough, yes, sir.
    Mr. Jordan. I mean the comments. He said may, then he said 
6,000 for three weeks, and then you said potentially 11. It is 
all referring to that portion of the Department of 
Agriculture's budget?
    Mr. Young. Yes, sir.
    Mr. Jordan. Okay. Can we put up the slide? Because I just 
want to show you, this is what our staff, looking at your 
numbers from the Department of Agriculture, I know it is 
difficult to see, but you can see the trend. It is pretty much 
a straight line. It is not like it a big drop off in one 
particular year or the other. In fact, where you are at post-
sequester, it is that line third from the right, that is pretty 
much where you have been throughout the last several years.
    And, I would further point out, you have had 20 months to 
get ready for this. This law passed, do you know when the 
sequestration law passed and was signed by the President?
    Mr. Young. In August of 2011.
    Mr. Jordan. August of 2011. So, it seems to me you should 
be able to deal with this in light of the history of this 
particular budget, the budget history there. Did you have to 
furlough any food inspection or safety people in 2009?
    Mr. Young. No, sir.
    Mr. Jordan. Did you have to furlough any in 2010?
    Mr. Young. No.
    Mr. Jordan. How about 2011?
    Mr. Young. No, sir.
    Mr. Jordan. What about 2012?
    Mr. Young. No, sir.
    Mr. Jordan. So, the lines are basically the same and in 
none of those years did you have to furlough. But suddenly a 
bill comes along that you had 20 months to prepare for and you 
are saying maybe 6,000 people are going to get furloughed for 
up to three weeks? And that has been revised down to we don't 
know how many but it might be 11 days. And you furloughed none 
in the whole pattern there.
    How long have you worked at the Department of Agriculture, 
Mr. Young.
    Mr. Young. I have worked there since about November of 
1983.
    Mr. Jordan. Since 1983. So, a few years, right? In all 
those years, can we go back, do you remember furloughing folks 
in any of those years? In the meat inspection and food safety 
part of your budget?
    Mr. Young. I don't recall a furlough during that time 
period.
    Mr. Jordan. Have any employees at the Department, this may 
have been asked while I was gone, have any employees at the 
Department of Agriculture received bonuses over the past year?
    Mr. Young. Yes.
    Mr. Jordan. How many?
    Mr. Young. I don't have that specific number with me.
    Mr. Jordan. Do you know what the dollar figure is?
    Mr. Young. I don't have the dollar figure, but I could get 
that for the record.
    Mr. Jordan. Okay. We would appreciate that. To your 
knowledge, has anyone instructed you at the Department, no, has 
anyone instructed you, or to your knowledge anyone else at the 
Department, to implement the sequester in the most politically 
painful way possible? Have there been any kind of instructions 
like that?
    Mr. Young. No, sir.
    Mr. Jordan. Have there been discussions at the Department 
to implement the sequester in a different way in which you are 
now implementing it? Were there other plans brought forward in 
discussions at the Department?
    Mr. Young. Yes. In fact, the Secretary's guidance has been 
that the sequester should be implemented in an equitable 
manner, in the least disruptive manner and to take steps that 
would allow us----
    Mr. Jordan. What I am asking is have there been plans 
brought forward which say if we do it this way, there is not 
even potential of food safety and inspectors being furloughed 
for any length of time? Have there been any of those kinds of 
plans that come forward and say, you know what, under this 
plan, we have got Secretary Vilsack saying oh, we may have to 
furlough 6,000 people for three weeks, you are saying 11 days 
and some number, but have there been other plans brought 
forward that say you know what, if we do it this way, we will 
not have to furlough anybody in the food inspection and safety 
area?
    Mr. Young. No, I am not aware of a plan like that. And I 
would just say that the plans developed for the Food Safety and 
Inspection Service, as well as the other agencies, were 
developed within the agencies and submitted forward. So, I am 
not aware of such a plan.
    Mr. Jordan. Okay. Real quick as I am about out of time. Or, 
I am out of time. Can we put up the second slide which shows 
the overall budget if we can? I just want to make this a part 
of the record. This should be slide one, if we can look at 
this. I think it should come up. Get rid of the ugly face on 
the picture and get the slide up. There we go.
    So Mr. Young, this is your budget. And if you notice, over 
the last several years, if you notice, and this is straight 
from the U.S. Department of Agricultural budget summaries, 
Budget Authority, if you look at the 2013 number after the 
sequester, it is larger than the 2012 number. And so, is it not 
true, Mr. Young, that your budget is going to be, is larger 
this year, even accounting for sequester, than it was last 
year?
    Mr. Young. It appears that that includes all programs, both 
mandatory and discretionary.
    Mr. Jordan. But are not all programs part of your budget?
    Mr. Young. They are all part of the budget but they are not 
all subject to sequester.
    Mr. Jordan. No, I understand that. I understand the 
difference between discretionary spending and mandatory 
spending. What I am asking you is, is it not true that the 
overall budget at the U.S. Department of Agriculture will be 
larger this year than it was last year, accounting for 
sequester?
    Mr. Young. Well, I don't have a comparison between 2013 and 
2012.
    Mr. Jordan. We can show you. We have, this is the USDA, the 
Appendix to USDA Budget Summary and Annual Performance Plan and 
it indicates that in 2012 it was $147,534 billion and in 2013, 
after sequester, it is $149 billion. So, that is roughly $2 
billion higher. Is that true?
    Mr. Young. Yes. I am sorry, I don't have those specific 
numbers in front of me.
    Mr. Jordan. We would be happy to give it to you. It is your 
document. It says Budget Summary and Annual Performance Plan, 
U.S. Department of Agriculture.
    Mr. Young. That would have been our President's budget 
submission from last February.
    Mr. Jordan. Okay. Great.
    All right. We now go to the gentleman from Nevada.
    Mr. Horsford. Thank you, Mr. Chairman.
    The people of my district sent me to represent them here to 
solve problems, not to create new ones. I was a former State 
Senator, I served as the majority leader, I was the chairman of 
our finance committee, and I had to work during very difficult 
time to root out waste and to identify savings in order for us 
to achieve our goal of finding a balanced budget.
    And I don't view our agency heads as the enemy. I view you 
all as partners. And I would just hope that we can change some 
of the rhetoric that this body and this Committee have been 
focused on because it is not what the American people want from 
us right now. They want us to work together to solve problems 
and the sequester is a problem that needs to be fixed.
    Now, I would like to ask the witnesses who are here, we 
just went through the history lesson of the three branches of 
Government and whose fault this is that we have this sequester. 
Now that we have it, who is going to take the responsibility to 
solve it?
    And my question is, do you have, under the Budget Control 
Act of 2011, the authority to reprogram in ways that would 
allow you to not implement the sequester? Yes or no?
    Mr. Sastry. Not to that extent, no.
    Mr. Young. Not in total, sir. We only have the one 
authority that I talked a little bit about before to transfer 
funds within an agency under certain conditions.
    Mr. Robbins. The FCC is a small agency and we basically 
have one account.
    Mr. Horsford. Will staff please put up the slide? Here is a 
slide that lays out the facts about agency authority to 
reallocate funds. The conclusion is that agencies are not free 
to undo sequester cuts mandated by the Control Act of 2011 and 
the restrictions on the agency authority to reallocate funds 
prevent Federal agencies from cutting a program altogether to 
offset the budget shortfall of another program.
    Now, what I find astonishing is if you all took the 
authority to do this around the Control Act, there would be 
Members who would be calling you up here asking you why you did 
that without the authority of Congress. That is the irony.
    The caps on the amount of funds that can be reallocated, 
emergency circumstances, purpose of reallocation and 
notification and approval requirements are some of the 
conditions on which programming is allowed. Is that correct?
    Mr. Sastry. Yes, that is correct.
    Mr. Young. Yes.
    Mr. Robbins. Yes.
    Mr. Horsford. So additionally, the size and scope of your 
respective agencies limit the ability to reprogram funds to 
offset budget shortfalls for another project. Is that correct?
    Mr. Sastry. Yes.
    Mr. Young. Yes.
    Mr. Robbins. And again, as I have mentioned, the FCC has 
one account basically and so we have, I think, a little bit 
greater freedom than my colleagues.
    Mr. Horsford. So, Mr. Chairman, I would just ask that, you 
know, the public understands that this reprogram authority is 
not an unrestricted power to pick and choose funding priorities 
based on the harm to the public. It is a highly-limited 
authority which Federal agencies will, of course, utilize where 
allowed by law. And if we do not like that, then we, as 
Congress, need to pass a law to work with our Federal agencies 
as partners to fix that problem.
    The USDA provides an example of the limits of that 
authority. The USDA's potential furlough of meat inspectors and 
its food safety inspection has gained a lot of attention 
because of the anticipated affects it will have on meat 
processing.
    So, in conclusion, Mr. Young, could USDA reprogram 
sufficient funds to prevent the unanticipated furloughs of all 
meat inspectors?
    Mr. Young. We have not been able to identify a means to do 
that, sir.
    Mr. Horsford. So, how do you arrive at the decision to 
furlough employees?
    Mr. Young. That decision, or again, that planning effort 
was undertaken within the agency and given the amount of the 
budget that is devoted just to salaries and expenses, or 
salaries and benefits, excuse me, and the other fixed costs 
that are related to that frontline inspection effort just 
precluded the ability to avoid that.
    Mr. Horsford. My time has expired. Thank you, Mr. Chairman. 
I would like to work together to find a solution, not just 
identify new problems.
    Mr. DesJarlais. [Presiding] The Chair now recognizes the 
gentleman from California, Chairman of the Full Committee, Mr. 
Issa.
    Mr. Issa. Thank you, Mr. Chairman. I am going to follow up 
where the gentleman from Nevada left off.
    I appreciate the ability to partner, but we are a separate 
branch of Government where our job is to hold you accountable. 
Let's go through some things. Mr. Young, were you aware of the 
letter that this Committee sent asking for what areas of 
reprogramming or changes would authorize you to save money on 
sequestration back in February around the automatic cuts?
    Mr. Young. Yes, sir.
    Mr. Issa. Are you aware that you have not responded?
    Mr. Young. Yes, sir.
    Mr. Issa. Is that because you have no, after 19 plus months 
you have no suggested changes?
    Mr. Young. I believe we are in the process of developing a 
response to that.
    Mr. Issa. Well, I appreciate your developing the response. 
Actually, statutorily, you owe Congress one on April 1st. The 
question is, if you wanted to avoid cuts, if you wanted to 
avoid the scare tactics that we have been hearing about not 
being able to get fresh meat, wouldn't you have responded at 
least with a couple that Congress could have acted on before 
the Easter recess?
    Is there any reason that you don't have even one item of 
reprogramming, one item of legislative business, that we could 
take up on a bipartisan basis, sort of the no-brainer that 
could save some dollars? Is there a reason that you didn't send 
one? Other than the bureaucracy of wait until you get White 
House authority. That one I don't want to listen to. Is there 
one reason you couldn't send us even one item to change?
    Mr. Young. Well, sir, again, in terms of actually 
reprogramming within the current----
    Mr. Issa. That it not what my letter said. What my letter 
said is, is there anything that given legislative action would 
allow you, what I basically said in the letter is to you and to 
your colleague to the left, the FCC didn't want, or didn't need 
one, it didn't happen to get one, you have taken care of the 
job quite well, is I was asking isn't there anything?
    I could draw up a bill in an hour and to be honest, I would 
demand that my leadership immediately consider ones that were 
narrow and specifically toward areas of waste. We got no answer 
from anybody but DOD and the Department of Defense, quite 
frankly, sent us what they had already agreed to with the 
appropriators.
    So, I will go your colleague, Mr. Sastry. You didn't 
respond, either. Is there not at least one item that you could 
have said Congress, I don't have authority, but if you will 
pass a quick law, a change, we could save money, we could avoid 
some portion of sequestration?
    Mr. Sastry. I do know we received the letter and it is 
being worked in a separate, in a different office. I will say 
that part of my job in resource management is to continue to 
plan for the current law that is in place which is 
sequestration which is what we have been focused on.
    Mr. Issa. Well, earlier today we had testimony that just 
the opposite, that nobody bothered to do anything in the way of 
actual true planning until the President signed the order, that 
they kept hoping that it would not happen. They kept noting 
that nobody could be as dumb, apparently, as the President for 
signing such a law and believing that it would happen. But the 
President signed such a law, agreed to do it, cuts only, not 
tax increases, and apparently he never meant it because you 
never prepared in advance for sequestration. And now you act 
surprised.
    Mr. Young, I am going to hit you with the one that I am the 
most concerned about. Under President Obama, without 
legislative action, food stamp programs have skyrocketed, not 
because there are more poor but because the program has been 
deliberately expanded.
    When the chairman of the subcommittee put up that budget 
number and you said that it may include the full budget, is it 
not true that, in fact, although entitlements were not subject 
to sequestration, it was part of your total budget and had the 
President made sensible reforms, including implementing the 
IG's suggestions, and brought down spending under entitlements, 
you would have in fact been bringing down your budget? Is that 
not true?
    Mr. Young. I am sorry, I do not have the estimates of what 
changes might have been.
    Mr. Issa. Have you looked at the IG's recommendations to 
the Department of Agriculture? Have you looked at some of the 
$67 billion of unimplemented IG recommendations?
    Mr. Young. We have looked at those, sir.
    Mr. Issa. Are you going to do that as part of 
sequestration, maybe implement some of those items? Budget 
sequestration is only for the amount you need to have. If you 
save, as the FCC is, from anywhere through attrition and other 
means, if you save all or part of the amount, then the budget 
across-the-board cuts go down. Is that not true?
    Mr. Young. Well, sir, the way we need to implement it is by 
each individual program.
    Mr. Issa. But it is relative. If you cut, if you were to 
find savings so that your target number was less, your across-
the-board sequestration would be less.
    Mr. Robbins, in the case of the FCC, you have already hit 
your sequestration number, have you not?
    Mr. Robbins. We plan to save $17 million through the rest 
of the year. We have not saved $17 million yet.
    Mr. Issa. But you have saved a considerable amount of it?
    Mr. Robbins. We are in the process of saving that money.
    Mr. Issa. So anything you save before March 1st in fact 
lowers the across-the-board cuts you would have to make if you 
are unable to save it in any other way, isn't that correct?
    Mr. Robins. That would be accurate.
    Mr. Issa. Mr. Chairman, I think the point I am trying to 
make is the FCC by comparison anticipated a law that has been 
on the books for 19 months and began making sensible, if you 
will, austerities. Well, agency after agency acts surprised 
that a law signed by the President 19 months ago actually meant 
what it said. I thank the Chairman and yield back.
    Ms. DesJarlais. [Presiding] Thank you, Mr. Chairman.
    I now recognize the gentleman from Missouri, Mr. Clay.
    Mr. Clay. Thank you so much, Mr. Chairman. And for my 
friend from California, I think we were all surprised that the 
sequester went into effect. But that was the law and we are a 
Country of laws and so we have to follow the laws.
    Let me ask Mr. Sastry, from a June 17, 2010 presentation on 
the 2020 Census goals by Assistant Director for ACS and 
Decennial Census Daniel Weinberg, Mr. Weinberg stated that 
investment is required early in the cycle to reduce cost and 
risk as the decade progresses. And he stated that the more 
substantial a change to the Decennial Design that is 
contemplated, the more must be invested up front in research.
    Sequestration will cut the Commerce Department budget by 
$551 million, $46 million of that will come from cuts to the 
Census Bureau. Mr. Sastry, how will the Census Bureau reach its 
goals of early monetary investments in program infrastructure 
to reduce costs for the 2020 Census if there is such a 
substantial reduction in the 2013 Budget and beyond?
    Mr. Sastry. Performing the 2020 Census at a reduced cost 
per household is one of their main goals, as you mentioned. And 
sequestration will reduce the 2020 Census, the early investment 
in the 2020 Census, just as it will every other program. And so 
there will be a risk that they will not be able to reduce the 
costs to the upcoming 2020 Census because of reduced 
investment.
    Mr. Clay. Yes, because that will increase the back loading 
of the budget for the 2020 Census. Was that taken into 
consideration?
    Ms. Sastry. As we continue to plan for sequestration, our 
mission is always our number one goal. However, the Budget 
Control Act didn't provide the level of flexibility for us to 
make those types of decisions.
    Mr. Clay. Okay. Then how will the cuts to the Census Bureau 
affect the ongoing efforts to update the Master Address File 
and the Partnership Program, both of which are critical in 
outreach efforts to underserved immigrant and minority 
populations in correcting the undercounted and providing for a 
more accurate census?
    Mr. Sastry. Those programs, too, will be impacted starting 
this year which will limit their ability, limit their 
efficiency, as we get closer to the 2020 Census.
    Mr. Clay. It seems as though you have heavily weighted 
cutting from the Census Bureau's budget. I don't know if that 
is wise planning.
    Mr. Sastry. Our ability to plan for the cuts was very 
limited from the Budget Control Act so it, what the amount that 
was taken and from the programs it was taken was prescriptive 
from the Budget Control Act.
    Mr. Clay. I am sorry to hear that.
    Mr. Young, because of the sequester, USDA identified a 
reduction of 600,000 lower-income women and children who could 
receive nutrition assistance and associated nutrition education 
and breastfeeding support through the Special Nutrition Program 
for Women, Infants and Children, WIC. Mr. Young, while SNAP and 
the National School Lunch Program are exempt from the 
sequester, how do the reductions to WIC disrupt and negatively 
affect the efforts of those programs to feed low-income 
families? Is there a relationship?
    Mr. Young. Well, I am not sure that I would have the 
specific information on that relationship. I do know that often 
folks who are participants in one of the programs may also 
participate in one of the others, depending on eligibility 
requirements. But as you indicated, the WIC Program is subject 
to the sequester.
    Mr. Clay. Yes. Would you be able to correlate or give us, 
give the Committee, some data relative to that?
    Mr. Young. I would be glad to work with the folks at the 
agency and see what we can provide on that.
    Mr. Clay. Okay, and you can also look at the First 
Congressional District of Missouri, which I represent, while 
you are at it.
    Mr. Young. Yes, sir.
    Mr. Clay. Thank you and I yield back, Mr. Chair.
    Ms. DesJarlais. Thank you.
    The Chair now recognizes the gentleman from North Carolina, 
Mr. Meadows.
    Mr. Meadows. Thank you, Mr. Chairman.
    I want to follow up a little bit on what Chairman Jordan 
had mentioned. He talked a little bit about bonuses. And so, 
none of you are aware of bonus levels that you have been paying 
to employees, is that correct? Mr. Young?
    Mr. Young. I do not have that information with me, sir.
    Mr. Sastry. I also don't have that information with me.
    Mr. Robbins. I would be glad to answer that for the record.
    Mr. Meadows. Let me go a little bit further then. The 
Department of Commerce, in 2011, paid $50 million in bonuses. A 
similar amount was suggested in 2012. USDA paid $33 million in 
bonuses.
    So as part of this plan, I am a little unclear on whether 
you have a plan or whether you don't have a plan because we 
have talked on both sides of that. Do you have a plan or do you 
not have a plan? Mr. Young?
    Mr. Young. We do have draft plans for each of the agencies 
to operate in the sequester.
    Mr. Meadows. And so those draft plans, did they include 
bonuses and guidelines for future bonuses?
    Mr. Young. Some agencies have made those sort of decisions. 
Again, I am aware that there are general guidance that bonuses 
will not be paid out during the time of the sequester.
    Mr. Meadows. And the OMB made that general guideline.
    Mr. Young. Yes, sir.
    Mr. Meadows. And have we seen employees leave because they 
are not going to get their bonuses? Have you seen people filing 
out of the doors because of that?
    Mr. Young. I am not personally aware of any.
    Mr. Meadows. Okay. How about you, Mr. Sastry?
    Mr. Sastry. I am not personally aware of any but I 
certainly cannot speak for the entire department.
    Mr. Meadows. All right. So, neither of you are personally 
aware of any lack of bonuses affecting the retention of 
employees. That is correct?
    Mr. Young. That is correct at this point, sir.
    Mr. Meadows. Okay. So, we have had since August of 2011 to 
plan for these cuts and now we are talking about laying off 
people that are depending on their salaries on a weekly basis 
to put food on the table. And yet, we were giving out these 
bonuses and not planning. Is it because you relied on the OMB's 
I guess letter of July 31st that says we have five months to 
act so really, at this point, continue spending as if you have 
always spent? Did you rely on that OMB guidance there as well?
    Mr. Young. Well, again, the agencies did have their full 
amount of funding available to them. But I would point out 
that, for example, in the case of the Food Safety and 
Inspection Agency, they did take a number of steps to reduce 
travel and conference spending, that sort of thing. They 
closed, I believe, five of their district offices over the past 
year. So they were taking steps.
    Mr. Meadows. And that is because of sequestration?
    Mr. Young. Well, that was because of operating more 
efficiently. They wanted to be in a position to operate more 
efficiently in the event that lower budgets for whatever 
reason, whether it be sequestration or lower funding levels, 
came about.
    Mr. Meadows. Okay, let's go back to your testimony earlier. 
You talked about the fact that there was personnel and you 
talked about this 80 percent figure in terms of personnel, some 
of that being food inspectors and then another portion of that 
being support. What percentage of employees would be support 
for the folks who are actually doing the food inspection?
    Mr. Young. I believe that about 88 percent of the agency's 
personnel are related to frontline inspection work.
    Mr. Meadows. Okay. So, 88 percent of them are frontline 
inspection.
    Mr. Young. I believe that is correct.
    Mr. Meadows. Okay. So you have just a small administrative 
support mechanism. Why would you say that most of the bonuses 
then went to those senior level support and not to the rank and 
file? When you look back at 2011 in terms of the way those 
bonuses were shared, they were shared at a more senior level 
instead of those that are actually, the 88 percent that are 
doing the job. Why would that be?
    Mr. Young. Sir, I am sorry. I do not have that data in 
front of me and I am not aware of the breakdown.
    Mr. Meadows. Okay. So, as we go forward, what other cost 
saving measures, other than furloughs, could you implement and 
become a part of your normal strategy?
    Mr. Young. Well, I do understand that the agency, for 
example the Food Safety and Inspection Service, does have a 
hiring freeze in place for non-frontline positions. So, some 
actions like that.
    Mr. Meadows. But that is not long term. What long-term 
plans do you have to save money? I mean, you know, if we have 
hiring freeze right now, that can be lifted. Are there any 
other systemic plans that you have made that will be saving 
monies long term?
    Mr. Young. Well, the agency has put forth a proposal to 
revise its poultry slaughter inspection process and that would 
potentially have longer term savings once that is implemented. 
It takes regulatory action to do that.
    Mr. Meadows. I see my time has expired. Thank you. I yield 
back.
    Mr. DesJarlais. I thank the gentleman from North Carolina.
    I would like to thank all of our witnesses.
    Mr. Connolly. Mr. Chairman, if you could just give me 30 
seconds.
    Mr. DesJarlais. Absolutely. The gentleman from Virginia is 
recognized.
    Mr. Connolly. I thank you.
    My head, like probably the panel's, is spinning at some of 
the contorted logic going on about sequestration and the 
complete about face of some of my friends on the other side of 
the aisle who were talking apocalypse now just last summer and 
now the President signed it and it is not going to be that bad. 
And they are even getting helpful and presenting some 
suggestions of cuts.
    Mr. Young, is citrus greening a serious problem to the 
citrus industry in Florida?
    Mr. Young. I understand it is, sir.
    Mr. Connolly. Would it be fair to say that it is costing 
the economy of Florida $3.6 billion?
    Mr. Young. I am not actually aware of the specific impact 
but we could certainly get that for the record.
    Mr. Connolly. Well, I have a study here that says it is 
$3.6 billion over five years including the loss of 6,600 jobs 
associated with this very serious deadly bacterial disease that 
is a growing threat to the citrus industry in your home State, 
Mr. Chairman.
    And I seem to recall that one of our colleagues made a big 
deal out of that is the study that you should get rid of. We 
don't need that. And I suppose that is matter of opinion. I 
commend the study to my friend the Chairman in the seat right 
now because we can get rid of studies like that, but they are 
not without economic implications.
    With that, I yield back.
    Mr. Jordan. Mr. Chairman, if I could?
    Mr. DesJarlais. Yes, the gentleman from Ohio.
    Mr. Jordan. Just to the same gentleman, while citrus 
greening may be a problem, is it not also true, or in your 
judgment, is a $16 trillion debt a problem as well, Mr. Young, 
for the Country? Is a debt bigger than the entire GDP, is that 
not a problem for the Country as well?
    Mr. Young. There will certainly be implications of a debt, 
but I believe that those sort of economic, larger-scale 
economic impacts would be not my bailiwick.
    Mr. Jordan. I understand. Thank you, gentlemen. Mr. 
Chairman, I yield back.
    Mr. Connolly. Would my colleague yield?
    Mr. Jordan. I would be happy to. I love this.
    Mr. Connolly. I just will remind my colleague that the 
context in which our friend and colleague from Texas brought up 
the study was not that we have to start somewhere. He actually 
ridiculed the study, as I understand it, and said it was 
clearly unnecessary which would come as news to an awful lot of 
citrus growers in Florida who actually understand the 
seriousness of this illness. If you want to eliminate it, go 
ahead.
    But the idea that there are no consequences to 
sequestration, then there are consequences to sequestration, 
and then when we find consequences to sequestration we belittle 
them.
    Mr. Jordan. Will the gentleman yield?
    Mr. Connolly. Yes.
    Mr. Jordan. I don't think, people are not arguing that 
there may be some consequences to reduced Government spending. 
What we are arguing is that there are also consequences to 
continuing to spend more money than you have and piling on a 
debt that is now bigger than our entire economy. That is the 
point.
    Mr. Connolly. No, my friend, I don't think that is the 
point because if you take that logic, then we might as well 
just shut down the Government, which may be the intention of 
some people around here. We still have to function.
    Mr. Jordan. No, no, no. I'm not saying that at all. But we 
need to take steps, to start taking those steps to get spending 
under control and a 2.4 percent reduction in spending out of 
the overall budget is not that big of a first step.
    Mr. Connolly. Well, again, I am very glad to have people on 
the other side of the aisle want to diminish the importance of 
sequestration. I have a different point of view. I think it is 
actually going to be quite serious. And I think, of course, the 
alternative is that we have a balance of revenue and spending 
cuts, not just spending cuts. And that is the philosophical 
difference, is it not?
    With that, I have to go vote.
    Mr. Jordan. Same here. Thanks, Mr. Chairman.
    Mr. DesJarlais. Well, I would like thank all of our 
witnesses for taking time in their busy schedules to appear 
before us today.
    The committee stands adjourned.
    [Whereupon, at 4:05 p.m., the committee was adjourned.]
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