Obama signs sequester cutting $85 billion from federal budget, federal work-study funding decreased

Hansook Oh

President Barack Obama officially signed the Sequestration Order for Fiscal Year 2013 Friday evening on Capitol Hill. The $85 billion worth of immediate cuts to the federal government–delayed by the American Taxpayer Relief Act of 2012 passed on Jan. 1, which averted much of the “fiscal cliff”–will now proceed.

According to the Congressional Budget Office, the sequester will decrease spending on domestic programs and the defense budget by $42.7 billion each, resulting in little over $85 billion. The American Taxpayer Relief Act of 2012 had decreased the sequester from its $1.2 trillion price tag by $24 billion.

Discretionary domestic spending, which includes the budget for the federal Department of Education, will be decreased by 5.3 percent, amounting to $28.7 billion. The cuts will not affect Pell grants or loans, but will decrease funding for programs such as Federal Work Study (FWS), a type of federal financial aid that that allows students to earn money to help pay for school.

Lili Vidal, director of the financial aid and scholarship department, previously told the Sundial that sequestration would result in an 8.2 percent loss of Federal Supplemental Educational Opportunity Grant (FSEOG) and FWS funding for the 2012-13 school year. However, on Vidal said in an email that the sequestration will not affect FWS programs until 2013-14.

“We expect that our tentative funding that we have already received notice of will be cut by approximately 5.1 percent,” said Vidal. “The possible good news is that our tentative allocations for these programs were increased for 2013-14 and the sequestration cut may still leave us a little ahead of the 2012-13 allocation we received this year. But nothing is known for sure until we receive our final allocation for 2013-14 and no one knows when that will be.”

Vidal said that as usual, her office will include language in award notices warning students that their financial aid may be reduced if federal, state or institutional funding levels change.