A political deal struck in the summer of 2011 will begin to affect the economy in late winter 2013, unless feuding lawmakers in Washington can agree on a compromise by Friday.
The sequester will mandate significant cuts to the federal budget, with few if any government agencies immune to reductions in funding. Defense and domestic spending will be evenly slashed, and the impacts on local economies are far from clear.
San Diego County has almost 70,000 federal employees and retirees, according to Eye on Washington, and their fate could include furloughs or worse. Media reports include warnings on delays in air travel and tax refunds. Civilians employed by the Department of Defense face the possibility of furloughs.
“The possibility exists for a 22-day furlough of Federal employees,” said Brian O’Rourke, spokesman for Navy Region Southwest.
But what does that mean for La Mesa?
The cuts could trickle down to six local companies that did business with the Department of Defense last year to the tune of about $1.1 million.
According to the Center for Defense Policy, which in September released updated data from several federal sources, these La Mesa companies did business with the Pentagon in 2011 (with the value of contracts noted):
- Helix Environmental Planning Inc. ($130,294) on El Cajon Boulevard in the category of “Environmental Consulting Services.”
- Hunter Steel Construction Inc. ($3,960) on El Cajon Boulevard for “Commercial and Industrial Building Construction.”
- Partners Data Systems Inc. ($17,523) on Via Mercado for “Custom Computer Programming Services.”
- Pisces Seafood International Inc. ($304,018) on Grandview Drive for “Fresh and Frozen Seafood Processing.”
- Stephen J. Wencho ($280,123) on Avenida Thomas for “General Medical and Surgical Hospitals.”
- Turbo CM Inc. ($363,893) on La Mesa Boulevard for "Engineering Services."
Spring Valley had 10 federal contracts in 2011 totaling almost $10.7 million, including Hugo Alonso, Inc. on Presioca Street, with a $7,291,810 contract for "Specialty Trade Contractors."
The San Diego Military Advisor Council estimates that between 4,000 and 5,000 ship repair jobs will be lost due to fewer surface ship availabilities, a loss of $219 million to the local economy.
“Sequestration presents a serious threat to jobs and our economy. Across-the-board cuts to federal programs would hurt families across San Diego County,” said county Supervisor Dave Roberts. “This is especially bad news as the nation is trying to climb out of the recession. It couldn’t come at a worse time.”
The Obama administration released on Sunday a report for each state detailing the impacts of the sequester’s budget cuts, and Republicans have accused the president of using scare tactics for political gain.
The seven-page report for California paints a grim picture for education, environmental protections, the military, law enforcement, child care, public health and government services. The report is attached to this article in the PDF section.
The nation has been through this drill before. The sequester was set to begin on Jan. 1, 2013, if lawmakers weren’t able to reduce the budget deficit. That deadline came and went, but they were able to agree on postponing the sequester for two months. That time is running out.