OMB Sequestration Memo

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OMB released its memo on February 27 outlining Federal agencies’ responsibilities under the sequester.  The full memo is here:Sequestration memo from OMB m-13-05

Agencies will need to:

• reduce approximately 9% for non-defense programs and 13% for defense programs

• maintain and prioritize mission

• identify any major contracts and grants they plan to cancel, re-scope delay or change payment amounts

• identify the number of employees furloughed, length of the furlough and timing

•  inform stakeholders – including Federal contractors – and partners in a timely and complete manner of sequestration using as many specifics as possible

• agencies should assure that any contract actions are cost-effective and minimize the impact on mission

• program, acquisition, financial/budget management, information technology and legal should work together to make contract determinations

• new contracts or exercise options should only be entered in to if they support high priority initiatives or failure would expose the government to significant costs in the future

• de-scope or terminate for convenience contracts that are no longer affordable — after evaluation of the cost and benefits and appropriately inform and negotiate with contractors

• in the case of grants, loans, and other Federal financial assistance, agencies should ensure that new obligations or existing agreements protect the mission at the post-sequestration level and inform recipients as early as possible

• implement internal risk management strategies and internal controls that provide hieghtened scrutiny of certain types of activities from sequestered accounts including:  hiring new personnel, issuing discretionary monetary awards to employees, incurring obligations for new training, conferences and travel.