Obama Admin's Decision to Retroactively Subject SRS Funds to Sequestration Cuts
The Committee is conducting an investigation into how and why the decision was made by the Obama Administration to subject 2012 Secure Rural School (SRS) funds to the 2013 sequestration cuts. The Administration has failed to fully comply with repeated requests for documents and Congressionally issued subpoenas to the U.S. Department of Agriculture (USDA) and the Office of Management and Budget (OMB). The SRS program helps provide rural counties with funds to pay for essential services such as education, police officers, emergency services, and infrastructure.
UPDATE (1/14/2014): Committee Majority staff releases report: “A Less Secure Future for Rural Schools: An Investigation into the Obama Administration’s Questionable Application of the Sequester to the Secure Rural Schools Program.”
Below are the documents and emails the Committee has obtained to date:
Due to the continued inability of the federal government to manage National Forest lands and provide local communities with a meaningful share of revenues from timber receipts, Congress has approved SRS payments to provide rural counties with funds for teachers, schools, police officers, emergency services and infrastructure. The SRS program was extended through fiscal year 2012 as part of the “Moving Ahead for Progress in the 21st Century Act,” that was signed into law by President Obama on July 6, 2012. The Department of Agriculture distributed $323 million to 41 states in accordance with that law in January of 2013. On March 19, 2013 the Obama Administration announced, citing the 2013 sequestration cuts, it was requesting repayment of $17.9 million in SRS and 25% fund payments that had already been disbursed to states.
Thirty-one Members of Congress sent a bipartisan letter to the USDA and OMB requesting that the repayment be halted and asked for a detailed explanation of the legal authority for demanding repayment of the funds. State Governors of both parties also informed the Administration that they would not repay the funds due to the questionable legal authority.
On May 20, 2013, Chairman Hastings sent oversight letters to the USDA and OMB requesting documents and information on how this decision was reached and the legal authority. After receiving no response by the Committee’s June 3rd deadline, initial follow up letters were sent to the USDA and OMB on July 18. Second follow up letters providing a final opportunity to comply voluntarily with the Committee’s document requests were sent on July 31. The same day, at a Full Committee markup, Chairman Hastings stated his plans to issue subpoenas if the Administration failed to respond in a timely manner.
On September 4, 2013, Chairman Hastings issued subpoenas to the USDA and OMB for documents. Since the September 18th subpoena deadline passed, the USDA produced 1049 pages of email communications and other documents, about 700 pages of which are copies of form letters. The OMB produced approximately 160 pages, consisting mostly of email communications between OMB and USDA and the Forest Service in January and February 2013.
The limited documents produced by the USDA and OMB raise significant questions about the rationale and legal authority behind the Obama Administration’s decision to sequester SRS money paid to states in January 2013. For example, internal emails show that the Forest Service notified OMB in February that, based on advice from the Office of General Counsel, money already paid to the states would not be subject to the sequester.
On November 5th, the Committee sent additional letters reiterating the Committee’s expectation of full compliance with the subpoenas and indicating the intention to hold an oversight hearing including testimony from Secretary Vilsack and Director Mathews Burwell.