Entries in Budget Cuts (3)


At White House Request, Lockheed Martin Drops Plan to Issue Layoff Notices

Kari Goodnough/Bloomberg via Getty Images(WASHINGTON) -- Defense contractor Lockheed Martin heeded a request from the White House Monday -- one with political overtones -- and announced it will not issue layoff notices to thousands of employees just days before the November presidential election.

Lockheed, one of the biggest employers in the key battleground state of Virginia, previously warned it would have to issue notices to employees, required by law, due to looming defense cuts set to begin to take effect after Jan. 2 because of the failure of the Joint Select Committee on Deficit Reduction -- the so-called supercommittee, which was created to find a way to cut $1.5 trillion from the federal deficit over the next decade.

Such massive layoffs could have threatened Obama’s standing in the state he won in 2008 and is hoping to carry again this November.

On Friday, the Obama administration reiterated that federal contractors should not issue notices to workers based on “uncertainty” over the pending $500 billion reduction in Pentagon spending that will occur unless lawmakers can agree on a solution to the budget impasse, negotiations over which will almost definitely not begin until after the election.

Contractors had been planning to send out notices because of the WARN Act (Worker Adjustment and Retraining Notification Act) which according to the Department of Labor requires “most employers with 100 or more employees to provide notification 60 calendar days in advance of plant closings and mass layoffs.”  

In a statement Friday, GOP Senators John McCain, Lindsey Graham and Kelly Ayotte accused Obama of putting “his own reelection ahead of the interests of working Americans and our national security by promising government contractors that their salary and liability costs will be covered at taxpayer expense if they do not follow the law that requires advance warning to employees of jobs that may be lost due to sequestration. … Apparently, President Obama puts politics ahead of American workers by denying them adequate time to plan their finances and take care of their families. The people who work in the defense industry and other government contracting companies deserve as much notice as possible that they are on track to lose their jobs.”

In July the Labor Department issued legal guidance making clear that federal contractors are not required to provide layoff notices 60 days in advance of the potential Jan. 2 sequestration order, and that doing so would be inconsistent with the purpose of the WARN Act.

In Friday’s memo, the Office of Management and Budget reiterated that notice, urging agencies’ contracting officials and CFOs to “minimize the potential for waste and disruption associated with the issuance of unwarranted layoff notices.”

The guidance issued Friday told contractors that if the automatic cuts happen and contractors lay off employees the government will cover certain liability and litigation costs in the event the contractor is later sued because it hadn’t provided adequate legal warning to its employees, but only if the contractor abides by the administration’s notice and refrains from warning employees now.

After “careful review” Lockheed announced Monday that it will abide by the administration’s guidance.

“We will not issue sequestration-related WARN notices this year,” Lockheed announced in a written statement. “The additional guidance offered important new information about the potential timing of DOD actions under sequestration, indicating that DOD anticipates no contract actions on or about 2 January, 2013, and that any action to adjust funding levels on contracts as a result of sequestration would likely not occur for several months after 2 Jan.  The additional guidance further ensures that, if contract actions due to sequestration were to occur, our employees would be provided the protection of the WARN Act and that the costs of this protection would be allowable and recoverable."

“We remain firm in our conviction that the automatic and across-the-board budget reductions under sequestration are ineffective and inefficient public policy that will weaken our civil government operations, damage our national security, and adversely impact our industry.  We will continue to work with leaders in our government to stop sequestration and find more thoughtful, balanced, and effective solutions to our nation’s challenges,” Lockheed said.

Copyright 2012 ABC News Radio


As 'Fiscal Cliff' Looms, Obama to Sign Bill Detailing Budget Cuts

Ingram Publishing/Thinkstock(WASHINGTON) -- Layoff notices could begin going out this fall, warning many of those who work for and with the federal government that they'll lose their jobs if previously agreed upon spending cuts take effect.

Unless a deal to avoid the so-called "sequester" is reached, taxes will go up on everyone and the nation will go over the so-called "fiscal cliff."

A bill passed by both houses of Congress would require the administration to detail the drastic government cuts that would kick in Jan. 2.  White House spokesman Jay Carney says President Obama will sign that bill, saying there won't be a way out of the sequester unless Republicans agree to the president's tax proposals.

"Congressional republicans are trying to get out of what they agreed to because they’d rather protect tax cuts for some of the wealthiest Americans than make tough choices needed to reduce the deficit," Carney said Thursday.

Republicans contend tax increases would kill hundreds of thousands of jobs.

Copyright 2012 ABC News Radio


Aquarius, World's Only Undersea Lab, Endangered by Budget

National Oceanic and Atmospheric Administration(NEW YORK) -- Sixty feet down in the waters off Key Largo, Fla., the water around the National Oceanic and Atmospheric Administration's Aquarius laboratory is clear, warm and blue.  Marine scientists -- aquanauts -- have been coming to live in this underwater habitat since 1993.

But the future of Aquarius is, at the moment, dark and clouded.  The lab, the only one of its kind in the world, has fallen victim to budget cuts from Washington. NOAA was under orders to tighten up, and the $3 million annual budget for Aquarius was eliminated.

"There were signals that the budget was tight, but we didn't think it would be zeroed out," said Thomas Potts, Aquarius' director at the University of North Carolina at Wilmington, which has operated the lab for NOAA.  "By the end of July we will have lost two permanent and three temporary staff members and will no longer be mission-ready."

"Mission-ready," as Potts put it, means keeping the lab in condition to be a safe habitat for up to six visitors at a time.  The lab, a 48-foot-long cylinder, made it possible for ocean scientists to study coral reefs or other ocean life, typically on 10-day "missions."

The lab has basic amenities -- bunk beds, laptops and a mini-kitchen -- but its greatest advantage is that scientists do not have to dive from the surface, do their work and come back up repeatedly.  That protects them from the bends, the debilitating condition that can happen if one surfaces too quickly and nitrogen bubbles form in one's muscles.

More than 100 groups of divers have gone to live in Aquarius in the last two decades, studying biology and the ocean environment.  NASA used Aquarius for its own missions, called NEEMO -- a chance for astronauts and engineers to get practice at living in closed quarters like a spacecraft, with limited support from mission control.

But while the lab had an aura of adventure to it, and the scientists who used it said it was valuable, Washington is struggling with budget realities.

"NOAA's core mission is to conduct and support scientific research and exploration of the oceans," said NOAA Administrator Jane Lubchenco -- herself a marine ecologist -- in a statement.  "The Aquarius program has been a vital part of this research and we fully recognize its importance.  Unfortunately, our budget environment is very, very challenging and we are unable to do all that we would like."

There is an Aquarius Foundation trying to raise private funds to keep the lab going, but Potts said its goal is $750,000 -- a fraction of what it would take to fund active work.  One disadvantage the lab has always faced is that it's expensive to maintain; even when it's not being used, divers need to go down each week to keep its systems working in salt water.  As it is, the lab's metal skin is encrusted in marine vegetation.

The lab's defenders say they hope a large donor will come forward.  They say there are possibilities, but so far nothing solid to report.

"Unless we get some pretty good news," said Potts, "our staff is going to start to drift away.  They're very talented people; they won't remain unemployed long."

Copyright 2012 ABC News Radio

ABC News Radio