June 18, 2012 in Idaho

Otter orders plans for less federal aid

 

BOISE – Idaho Gov. Butch Otter has told agency chiefs to start planning for possible reductions in federal aid and come up with a plan in dealing with having reduced budgets.

“I’ve asked them to factor in a 20 percent cut in their federal funds and then come back to me with an action plan on what we’re going to have to do,” Otter said in a speech last week to the Idaho Association of Commerce and Industry.

Federal aid supports more than one-third of state spending.

A possible $1.2 trillion in automatic, across-the-board budget cuts in domestic and military spending could be triggered under the Budget Control Act over the next 10 years. The cuts, known in Congress-speak as “sequestration,” are due to start in January because a special panel failed to reach a deal last summer to reduce the deficit.

“I want us to be ready because there is a lot of importance to those federal funds,” Otter said in the speech, the Idaho Statesman reported Sunday. “They do a lot of great things. But those things are going to have to be prioritized because I can’t fathom, nor would I ask the Legislature to replace, all of those federal funds that are not going to be coming to Idaho.”

Sen. Mike Crapo, R-Idaho, said it’s unclear what will happen after the November election but that Otter was doing the right thing.

“I think it’s very wise advance planning,” Crapo said.


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