On March 26, 2013, the President signed the FY 2013 budget bill.  The Census Bureau’s FY 2013 enacted discretionary budget is $858 million, $112 million or 11 percent below the President’s request of $970 million.  The enacted budget reflected specific cuts to selected periodic programs as well as across the board sequestration and rescission reductions to each of the Census Bureau’s fifteen program budgets. The Department of Commerce submitted individual bureau spend plans to the Congress in May and the spend plans were finalized on June 13, 2013.  This blog describes the impact of the FY 2013 enacted budget.

The Census Bureau is committed to transforming the way we do business. This year we halved the number of Regional Offices from twelve to six; changed the way we manage and conduct our reimbursable surveys; significantly expanded internet data collection for both the American Community Survey and the 2012 Economic Census; cut administrative costs; and began transforming the way we process surveys and censuses through the use of adaptive design and shared services.  While these initiatives helped address some of the budget shortfall, additional actions were required to operate at the lower funding levels.

Strategically, our goal was to minimize the impact on our employees, seeking to avoid furloughs, while sustaining our core mission and preserving our most important programs within the limited flexibility provided.  In order to minimize program terminations, we have cancelled, reduced the scope of, or not awarded over $30 million in contracts originally planned for the second half of this fiscal year.  These contract reductions, of course, will have programmatic impacts.  Additionally, we have imposed a hiring freeze for all but the most mission critical positions.  We will not fill over 100 critical vacancies, we have reassigned 26 employees to other work, and we terminated the appointments of 41 temporary employees at the National Processing Center who were working on the Economic Census.  In addition, we have reduced training, travel, and other discretionary spending.

In terms of major programs, the impacts of reduced funding levels are described below.

Economic Programs:  In March, the Census Bureau suspended all work on the 2012 Survey of Business Owners (SBO) in anticipation of reduced Economic Census funding.  This survey, conducted every five years, is the only source of information on women, minority, and veteran-owned businesses and small business entrepreneurial activity.  In order to initiate SBO data collection this fiscal year, the Census Bureau is reprogramming $2.25 million from the 2010 Census to the Economic Census.

Reductions to the 2012 Economic Census staffing levels, both in the National Processing Center and at Census headquarters, may cause up to a six-month delay in the delivery of over 1,600 Economic Census products, which ultimately support the accuracy of the Gross Domestic Product (GDP).  The Census Bureau has suspended all work on the 2012 Information, Communication, and Technology Survey, which is an important source of business investment data used for economic forecasting.

2020 Decennial Census Programs:  Planning for a Decennial Census is a decade-long endeavor, based on planning and research.  The substantial cuts to the 2020 Census threaten the Census Bureau’s ability to deliver the preliminary design options for the 2020 Census in FY 2015, as scheduled.  At the reduced funding level, we cannot carry out the planned research and testing plan needed to inform the design options.  The reduced FY 2013 funding level also has forced us to delay field tests and preparatory work related to FY 2014 field tests, which pushes back the evidence needed to make design decisions in FY 2015. Delays in research related to more cost-effective census methods could result in higher census costs later in the decade.

Geographic Support Program:  Reductions to the Geographic Support program will delay important research related to the Master Address File, likely delaying decisions about the viability of cost-saving designs associated with the 2020 Census address canvassing operation, scheduled for later in the decade.

American Community Survey:  Cuts to the American Community Survey (ACS) eliminate much needed investments in the ACS processing infrastructure, program management, and research program.  These reductions undermine the ACS’s ability to serve as a test bed for the 2020 Census and will likely delay planned ACS content and instrument research and testing.

Demographic Programs:  Cuts to these programs prevent the implementation of new supplemental poverty measures.  These new measures would have supplemented the official measures of poverty with annual measures from the CPS Annual Social and Economic Supplement that more accurately measure economic deprivation.  These cuts will also delay data releases for the 2014 panel for the Survey of Income and Program Participation.

2010 Census:  In order to provide funding for the 2012 Survey of Business Owners, the Census Bureau requested and the Congress approved the reprogramming of $2.25 million from the 2010 Census.  The loss of this funding will delay, or possibly cancel, the release of the 2010 Census Public Use Microdata Sample (PUMS) file.  The staff working on the 2010 PUMS file have been reassigned to work on the 2020 Census program.

The actions described above permit us to operate at the lower funding levels for FY 2013.  However, these reductions are not sustainable in the future.  The Census Bureau needs full funding – and needs it early in FY 2014, in order to avoid terminating additional programs and causing major disruptions to the 2020 Census Research and Testing Program.