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Posted on Mon, Mar 25, 2013 : 5:58 a.m.

Local agencies, institutions grappling to plan for cuts in federal funding due to sequestration

By Amy Biolchini

As the federal government continues to deliberate the extent and timing of forced budget cuts known as sequestration, local agencies and organizations are grappling with the possibility of extensive cuts to their funding.

The exact meaning of the cuts is relatively unknown, and local agencies and institutions that utilize federal funding are trying to adjust their plans to deal with shrinking budgets.


The University of Michigan Health System anticipates $6 million less in Medicare reimbursements as a result of sequestration, but the exact amount is still unknown as the federal government deliberates.

Melanie Maxwell | file photo

A number of Washtenaw County services that help poor individuals are readying for cuts that total about $437,000 -- or about a 5 percent cut to federal funding award amounts across the board, according to information compiled by Mary Jo Callan, director of the Office of Community and Economic Development.

“We’re trying to literally keep meals on the tables,” Callan said. “We’re doing triage.”

Callan said the cuts will mean fewer people can be helped in programs funded through departments including U.S. departments of Housing and Urban Development, Labor, Health and Human Services, Energy and Agriculture.

About 11,000 fewer meals would be served through the Senior Nutrition Program and about 630 fewer people could be helped through the Employment Service Program, Callan said.

At the state level, those departments will be receiving cuts to their budgets exceeding $52 million.


Sequestration includes a number of forced budget cuts throughout the next 10 years.

The Federal Aviation Administration announced Friday the closure of a number of airport control towers it contracts out would be closing.

Control tower staff at the Ann Arbor Municipal Airport and the Willow Run Airport -- who are full FAA employees -- have yet to be notified that their hours would be cut or reduced, respectively.

Medicare is expected to reduce payments by physicians, hospitals and private insurers by 2 percent as of April 1.

For the University of Michigan Health System , reductions in Medicare reimbursements means a $6 million reduction in reimbursements for the remainder of the 2013 fiscal year, which ends June 30.

In the 2014 fiscal year, the health system will receive about $14 million less in Medicare reimbursements, according to information provided by UMHS.

To date, no layoffs at UMHS have occurred as a direct result of sequestration, said Pete Barkey, spokesman for the organization.

Barkey said UMHS anticipates that there could be ramifications with federal funding cuts.

“We’re well aware of what the potential impacts of this are and keenly watching to see how this unfolds,” Barkey said.

The potential cuts in federal funding were taken into account during the development of the budget for the current fiscal year, Barkey said.

However, researchers at UMHS and across the state will likely face less grant funding for their work and increased competition for the number of grants that are offered.

In 2012, researchers in Michigan received $655 million in funding from the National Institutes of Health and a total of $1.02 billion in federal research dollars.

Research institutions that make use of National Institutes of Health grants will likely see a 5 percent decrease in their funding.

About $33.4 million in NIH funding to Michigan researchers could be at risk for being cut this year, according to an estimate from the Federation of American Societies for Experimental Biology. The University of Michigan is anticipating a cut as high as $40 million in its research funding.

Researchers at UMHS will likely receive lower levels of funding in grants that are non-competitive and renewed each year, and they may have to renegotiate the amount and scope of certain grant awards they have received from NIH.

There will also likely be several hundred less grants awarded from the National Science Foundation in the 2013 fiscal year.

Amy Biolchini covers Washtenaw County, health and environmental issues for Reach her at (734) 623-2552, or on Twitter.



Tue, Mar 26, 2013 : midnight

Shame on this administration they new these cut were coming for over a year why would they not make cuts in other places we all know about how they waste are hard earned money.


Mon, Mar 25, 2013 : 11:57 p.m.

Why are they cutting 5% when the actual amounts being paid out are still the same and the only decrease was the rate of increase? We are being played hard by this administration. They are targeting areas like this, the Blue Angles, Whitehouse tours, chidrens programs, non-union FAA trafic control towers (no union members cut). This is all a big game to try and paint those who won't vote for more spending as heartless, when in actuallity these cuts are being selectively targeted by this administration. I'm outraged as a taxpayer they would stoop this low....................


Mon, Mar 25, 2013 : 11:42 p.m.

Lights out at Willow Run? Now that is scary. Especially since this is a busy airport and there are homes all around. Wow.

Roger Kuhlman

Mon, Mar 25, 2013 : 8:52 p.m.

Why doesn't the Feds cut all the money for the new Amtrak railroad station and the low-speed rail service in southern Michigan? Such cuts would not hurt anybody in any real sense!


Mon, Mar 25, 2013 : 4:04 p.m.

Trim the fat and tighten the belt like the rest of us on a budget. It's not the end of the world.

Seasoned Cit

Mon, Mar 25, 2013 : 3:54 p.m.

Isn't it amazing how the sequester cuts are supposedly impacting local agencies etc......especially when you realize that the "cuts" are from 2013 budgeted funds which in reality are still greater, even after the "cuts", than was budgeted in 2012 ! That should scare us all as we see how government and its programs have continued to grow, of course, using borrowed funds for the growth.


Mon, Mar 25, 2013 : 1:17 p.m.

The UN food agency is voluntarily funded. President Obama said today the US will provide $ 200 million in additional humanitarian aid. As the conflict continues the humanitarian needs will grow. Along with the other hundreds of millions he'll be passing out to countries to support democracy quit your complaining be happy your tax ( borrowed) dollars are being well spent.

Jay Thomas

Tue, Mar 26, 2013 : 1:55 a.m.

@ J-smith: Bush did give away a lot of money (for which he received no credit from the democrats for being a humanitarian). Obama is sending more to Egypt right now, even as he cuts things at home to make people feel the pinch.

Jay Thomas

Tue, Mar 26, 2013 : 1:43 a.m.

The U.N. food aid budget always needs more money because it always has more mouths to feed. When you live in a desert but have 5-6 kids that's what happens. Sending contraceptives by the boatload would make more sense. Coincidentally, if you look at a chart of Africa's population over the past century you will see it heading to the moon as soon as international food relief was guaranteed. So the aid given and needed is actually self perpetuating.


Mon, Mar 25, 2013 : 1:56 p.m.

J-smith, relax don't get your shorts in a bind, just passing information along, the point being whether it's this administration or others, we need to take care of this country and all the issues we have today, stop giving to other countries and help this country, I've been adamant with all Politicos since Nixon was in office, If I don't support what I feel is right then I have every right to object and vote or voice my opinion as I see fit.


Mon, Mar 25, 2013 : 1:37 p.m.

Hey J-smith, don't you get it yet? No one is blaming Obama. it's BOTH parties and it started decades ago. Let's stop pointing fingers and start solving the problem. We will either pay now (give-up goodies we all think we deserve) or really pay in the not too distant future.


Mon, Mar 25, 2013 : 1:26 p.m.

Could you list foreign aid given by presidents you voted for, tally it all up and let us know how many letters/faxes you sent in worry about deficit spending. For instance, -In March 2002, Bush proposed an increase of 50 percent over the next three years through the creation of a Millennium Challenge Account (mca), a fund that would provide $5 billion per year to a select group of countries that are "ruling justly, investing in their people, and establishing economic freedom." Then came his 2003 State of the Union address, in which he called for $10 billion in new funding ($15 billion total) over the next five years to combat hiv/aids in Africa and the Caribbean. This proposal was rapidly signed into law in late May, on the eve of the G-8 summit. And Bush's 2004 budget included two smaller initiatives: a $200 million famine fund and a $100 million fund for "complex emergencies." If these programs are funded as proposed, they will increase U.S. foreign aid from approximately $11 billion in 2002 to $18 billion in 2006 -- the largest increase in decades. - The interesting thing about this is that it increased our debt, and much of it was approved by a congress controlled by the GOP, including Paul Ryan.

Kai Petainen

Mon, Mar 25, 2013 : 12:25 p.m.

this is almost completely off topic... but you mention airports. I love the shots that Melanie took of the city from above. you should go up and take some more at different times of the year... and then go up at least once a year to document how ann arbor changes.... and photograph some of the big events too (if they allow planes to do that) great photos...

Kyle Mattson

Mon, Mar 25, 2013 : 12:50 p.m.

We do plan on heading up for future trips Kai. If spring ever arrives this year we hope to make it up to catch the city in bloom. Not sure about big events due to the time/cost commitment for it, but it is worth considering, thanks for the idea.


Mon, Mar 25, 2013 : 11:59 a.m.

Hopefully this is the starting point of the collective sacrifice that our society must make to get our financial house in order. We still need more spending cuts at all levels.


Mon, Mar 25, 2013 : 12:23 p.m.

I think the suggestion that our politicians get no pay until they have a balanced budget would be a great start.


Mon, Mar 25, 2013 : 11:46 a.m.

Beltway extortion plain and simple..biden spends $1,000,000.00 on a Paris junket on our tab and they pull this kind of crap to scare the sheeple into believing they know whats best to do with OUR $$$$$......hows that " hope and change " working now...


Mon, Mar 25, 2013 : 1:38 p.m.

At least Biden didn't go to Paris to start a multi-trillion dollar war.


Mon, Mar 25, 2013 : 11:19 a.m.

Let's see. . . Our government will cut lifeline services for the poor to save $437,000. Meanwhile, our Department of Energy will subsidize a $1.5mil Ann Arbor wind turbine for "renewable energy", in an area where there is non-viable wind. . . It's a sequestration of funds, as well as common sense and good. . . aka penny wise, pound foolish.


Tue, Mar 26, 2013 : 7:17 p.m.

Sparty - But the $12 billion in "high speed" rail boondoggle continues, even CNN is having fun with this mis-named and poorly planned activity.


Mon, Mar 25, 2013 : 12:46 p.m.

umm... hey, ever check out how much we subsidize fossil fuels...?


Mon, Mar 25, 2013 : 11:52 a.m.

Did you miss the $40 MILLION in Research funding cuts at U of M, the $14 MILLION cuts at UMHS, the 2% cut to physicians, etc. These Sequestration cuts are very real and are affecting a lot of people. How much is the cost to subsidize renewable energy? And is it the Federal Govt doing it or DTE, in order to meet their requirements?


Mon, Mar 25, 2013 : 11:07 a.m.

Are these really cuts? How much did they get the prior year?


Mon, Mar 25, 2013 : 11 a.m.

Reductions in the gravy train will certainly hurt those whose livelihoods depend on gravy. There's no way around it.


Tue, Mar 26, 2013 : midnight

1bit- "Danger" is my middle name.


Mon, Mar 25, 2013 : 4:05 p.m.

This is a very silly and dangerous perception.