Indian Country and the Federal Budget

Feb 28, 2013

Native American Legislative Update - February 2013

A major deadline looms at the end of this month. According to the Budget Control Act adopted last August, and then delayed by a bill that passed in December, Congress must figure out how to reduce deficit spending (or adding more to the federal debt) by the end of February. If Congress fails in that task – and failure seems virtually assured at this time – a formula of across-the-board spending cuts will go into effect. For most programs in federal budget, this will mean about an 8 percent spending cut in the remainder 2013.

Apocryphal news stories of government collapse aside, these cuts will be very hard to absorb for programs that support or even rescue people in poverty. Funding for most of these programs has already been reduced dramatically since 2010—the across-the-board (or sequestration) cuts will go even deeper. They will affect education, housing, transportation, infrastructure, economic development, and health care programs. Although Medicaid funding is currently protected from cuts, and Medicare funding cuts are limited to 2 percent, Indian Health programs are not protected, nor is the Special Diabetes Program for Native Americans.

The National Congress of American Indians has released a report on how the across-the-board cuts would impact Indian Country. In 2013 alone, NCAI estimates that tribes will lose a total of $130 million if all the cuts required by the sequester are implemented. Read the full report here.

What will happen next?

There’s always a next step. Currently, federal programs are funded through a “continuing resolution” – a bill passed in December that allowed funding to continue for a few months (at last year’s levels). As of March 27, Congress has to agree on funding for the rest of the fiscal year - that is, until September 30, 2013. That agreement will probably have to comply with the across-the-board cuts. So beginning in April, most federal programs will probably feel the impact of the reduced funds.

It’s possible, however, that Congress will arrive at a solution that protects some high-priority programs from cuts and ends some programs that are no longer needed. So during the month of March, everyone who is concerned about a line item in the budget will be lobbying to protect their interests. From major defense contractors to child hunger advocates, many voices will be heard in Washington. You can help Congress identify the right priorities by contacting your own representative and senators and telling them what you think is most important to preserve or even strengthen.

The Federal Budget for FY2014

Even as Congress works its way from one self-imposed emergency to the next one, the Budget Committees are already beginning work on next year’s budget – for FY 2014.

The National Congress of American Indians (NCAI) has submitted a very thorough budget request for FY 2014, outlining tribal needs in areas ranging from public justice, natural resources, telecommunications, transportation and infrastructure, to child welfare, health care and education.

In its budget submission, the NCAI stresses two important points:

  • Though many Indian programs are part of the so-called “discretionary” section of the federal budget, they are not simply voluntary contributions to be made out of excess available funds. Through treaties and other obligations, the U.S. has already committed itself to supporting the health and welfare of Indian country, and the U.S should keep its promises.
  • Tribal governments are not permitted to collect taxes within the borders of their lands, so they have no other source for investments in their future other than those that come through the federal government. Even Indian-owned businesses that are doing well and contributing generally to the local economy cannot be taxed by the tribal government. The taxes they pay go to the federal government, without a set-aside for the tribes.

Download part or all of the NCAI’s FY 2014 Indian Country Budget Request here.

Return to the index of the February 2013 Native American Legislative Update.

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