Abercrombie to Establish ‘Sequestration Impact Response Team’

Governor Neil Abercrombie. Courtesy file photo.

By Wendy Osher

Governor Neil Abercrombie today announced plans to establish a “Sequestration Impact Response Team” to address nationwide federal spending reductions scheduled to take effect by midnight tonight.

The Sequestration Impact Response Team, made up of public and private stakeholders, is being established to mitigate the impact of the sequestration throughout the state of Hawai’i.

“The team will include representatives from government, nonprofits, the military, and business leaders, who are ready to identify how we can help our citizens and segments of our community that will be most affected,” said Gov. Abercrombie in a media statement this afternoon.

According to the governor, he included a contingency of $25 million per year, specifically for the possibility of sequestration when he submitted the state’s 2013-2015 fiscal biennium budget in December.

“What remains uncertain is whether federal sequestration reductions will be permanent, or even extend longer than one year,” said Finance Director Kalbert Young, who joined the governor in a press conference to address the impacts to Hawai’i. “Our financial plan has provisions to accommodate up to $25 million in each of the next two fiscal years. We have already identified as much as $45 million in direct federal grants to Hawaii that may be at risk,” said Young.

The governor said that the administration will roll out contingencies as the true scope of sequestration unfolds.

Last week, the governor reportedly ordered all state departments to work with their federal counterparts to assess which areas will be impacted and estimate the amount of state funds needed to continue services and programs.

Over the next week, state departments are expected to hear from federal departments and agencies about federal funding programs and grants that will be reduced. Departments will use this information to look for ways to sustain state programs over the next year.

“We are in constant communication with the US Pacific Command and aware of its plans to implement furloughs, which may affect some or all of its 19,000 Department of Defense civilian employees in Hawai’i,” said Gov. Abercrombie. “We understand that the DOD will be issuing letters later this month to notify those who are going to be furloughed. The lost wages during that period are estimated to be $138 million,” he said.

Gov. Abercrombie said he has contacted local financial institutions to encourage them to assist federal workers in the islands who may experience financial difficulty. “This is a time when we need to show and practice aloha to those directly affected by these nation-wide cuts,” he said.

Today, President Barack Obama urged Congress to take a responsible approach to deficit reduction as the nation faces a sequestration deadline and potential $85 billion in automatic spending cuts.

Hawaii’s senatorial delegates in Washington said the impacts of across-the-board-cuts would hurt middle-class families.

US Senator Brian Schatz said the cuts can be averted through smart reductions in domestic and defense spending, and by closing tax loopholes. Fellow US Senator Mazie K. Hirono called the proposed cuts bad for national security, the economy and jobs.

Those in Washington remained deadlocked today over the issue, failing to reach a deal on how to avert the automatic spending cuts.

***Supporting information courtesy Governor’s Office, State of Hawai’i.