Fiscal Update


Hello Shipmates,

In my last blog post I briefly discussed the budget situation and how it might affect you and our Navy. I’d like to give you some facts as they pertain to you and let you know what we are doing to prepare for the consequences of a year-long continuing resolution (CR), as well as the impending threat of sequestration.

First and foremost, my main priority remains making sure we provide for you and your families, and fund our most important current missions and deployments. Your pay will not be reduced and your benefits will not be affected in fiscal year 2013. I’ve said before, retirement for those on active duty, and current retirees, will not be affected. Family programs and Tuition Assistance will remain intact and available.

This brings me to the “CR.” Since Congress has not passed a FY 2013 funding bill, we are operating under a CR. This limits us to FY 2012 spending levels in all our accounts, and prevents us from changing funding to programs or adding new programs in FY 2013. Further, the FY 2012 operating account funding levels are inadequate for our FY 2013 operating needs. We do not yet have permission from Congress to transfer money from other accounts to our operating accounts to make up for the shortfall. Therefore, to avoid running out of money in our operating accounts and to ensure we support deployed operations, we have to cut our spending in the operating account on maintenance and lower priority operations, starting now.

About sequestration. If this occurs in March as currently written in a previous law, we will endure across-the-board cuts, in all accounts, of about 9%. This cut will be on top of the shortfall due to the CR if we don’t have a funding bill at that point. These sequestration budget cuts could further reduce training and operations, unless Congress gives us permission to reprogram funding from other accounts.

I remain hopeful that Congress will pass a funding bill and sequestration will be averted. However, it’s important that you are aware of the potential events that affect us as an organization. Despite an unsettled budget climate, you continue to do exceptional work in accomplishing the mission at hand. Keep your focus on: war fighting first, operating forward and being ready and we’ll keep you posted on the budget developments.

 As always thank you for your service and keep up the great work.

Admiral, U.S. Navy


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