Kirsten Gillibrand United States Senator for New York

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Gillibrand, Schumer, Maloney, King, Nadler Press Feds to Protect Zadroga Funds from Any Sequester Cuts

New York Lawmakers Fight to Protect 9/11 Health & Compensation Programs from Looming Budget Ax

September 28, 2012

New York, NY – U.S. Senators Kirsten Gillibrand (D-NY) and Charles Schumer (D-NY), joined by Representatives Carolyn Maloney (D-NY), Peter King (R-NY), and Jerrold Nadler (D-NY) today urged the Office of Management and Budget (OMB) to preserve funding for the critical 9/11 health programs that were passed into law under the James Zadroga 9/11 Health and Compensation Act should any sequestration budget cuts go into effect next year. A preliminary report by OMB shows that $24 million is slated to be slashed from the Victim Compensation Fund, and an additional $14 million would be cut from the World Trade Center Health Fund in 2013, as part of the deal to cut over $1 trillion in defense and domestic programs, known as sequestration. 

The lawmakers wrote in a letter to OMB Acting Director Zients, “[W]e all agree that applying sequestration to these two programs [established by the James Zadroga 9-11 Health and Compensation Act] does not make sense, is not consistent with Congressional intent, does not follow precedent regarding trust funds provided for victims, and we would urge OMB to reconsider this initial finding if it is required to proceed with a sequester… We are concerned that OMB has not fully investigated the facts under which these programs operate.” 

“Nothing exemplifies this unbalanced and draconian approach to deficit reduction more than asking our heroes who have already sacrificed so much to sacrifice yet again,” said Senator Gillibrand. “Our 9/11 heroes who answered the call of duty should be treated with the same dignity as our veterans. Just as we have come together as Democrats and Republicans to fight for our heroes, I urge our colleagues to do the same and work towards a balanced approach that keeps struggling families from sacrificing the most.” 

“This is one of the most poignant examples of why we must work to avert the sequester,” said Senator Schumer. “We can entirely avoid this problem if both parties agree to support a balanced deficit reduction plan that includes revenues as well as sensible savings.  But in the event that they don't, we must work to make sure there that the burden does not fall on the national heroes who are finally receiving the help they deserve through the Zadroga Act.  Veterans have been exempted from sequestration and the heroes who have rushed to towers after 9/11 should be treated the same.  They risked their lives in a time of war and suffered for it.” 

“Sequestering 9/11 health funding would be a monumental misapplication of the law and a gross affront to those who continue to suffer the health consequences of the terrorist attacks and their aftermath,” said Congresswoman Maloney. “The World Trade Center Health Program and the Victim Compensation Fund are both paid for with a dedicated funding stream and do not contribute one cent to our nation’s budget deficit. Needlessly cutting health funding for responders, workers, and residents who are sick or dying as a result of their exposure to Ground Zero toxins would literally be adding insult to injury.” 

“We have come too far and our 9/11 heroes have endured too much for this funding to be subjected to a bureaucratic reduction,” said Congressman King.  “It would be a cruel hoax to finally allow these individuals to start their necessary treatment, only to find out they will not be able to continue it through no fault of their own.” 

“I am quite concerned that, among the vast devastation that sequestration would bring, it will also include cuts to Zadroga Act funding,” said Congressman Nadler.  “We have all worked extremely hard, with the help and support of 9/11 first responders and survivors, to obtain health care and compensation for those who need it, and we must not now, all of a sudden, ration assistance for the sick.  We are urging the Office of Management and Budget to reconsider its determination on Zadroga’s exemption from the sequester.  The health and well-being – not to mention peace of mind – of thousands of responders and survivors of 9/11 depend on it.” 

In addition to noting that cuts to these programs would be devastating for the families of 9/11 victims and first responders, the five members of Congress also listed three key reasons why the 9/11 programs should be exempt from automatic cuts: 

  • The preliminary budget fails to take into account New York City’s agreement to voluntarily pay 10% share for the 9/11 program. Under federal rule, “activities financed by voluntary payments to the government” are exempt from sequester. Lawmakers pointed out that according to this statute, the City’s voluntary contribution should be protected from the sequester process. 
  • The 9/11 health programs should be added onto the list of federal health and compensation programs that are already immune from cuts. There are currently 150 exemptions, including at least six programs established for injuries and illnesses, signed into law by February 2010—nearly a year before the 9/11 health bill was passed. Had the 9/11 health bill existed then, the 9/11 programs would have been among the items protected from sequestration.
  • The proposed budget cuts are an affront to the 9/11 health law that was already formulated to cut the deficit. The 9/11 law was already devised to be fully paid for and to cut the deficit. According to the Congressional Budget Office's estimate, the law slashes $433 million from the deficit. 

The budget already spares veterans from most of the automatic budget cuts.  OMB released a letter in April assuring that programs under the Veterans Affairs agency would be exempt from sequestration.  

Full text of the lawmakers’ letter is below:

Dear Acting Director Zients, 

 

We are writing to convey our deep concern about the Office of Management and Budget’s (OMB) initial determination that the programs established by the James Zadroga 9/11 Health and Compensation Act are subject to sequestration under the Sequestration Transparency Act of 2012.  As Members of Congress, some of whom voted for the “Budget Control Act of 2011” and some of whom voted against, we all agree that applying sequestration to these two programs does not make sense, is not consistent with Congressional intent, does not follow precedent regarding trust funds provided for victims, and we would urge OMB to reconsider this initial finding if it is required to proceed with a sequester.

 

The September 14, 2012  “OMB Report Pursuant to the Sequestration Transparency Act of 2012 (P. L. 112–155)” identifies the World Trade Center (WTC) Health Program, administered by the Department of Health and Human Services and the September 11th Victim Compensation Fund (VCF), administered by the Department of Justice as programs subject to sequestration.  Both of these programs are listed as being subject to a 7.6 sequester percentage with the WTC Health Program’s $190 million budget authority for FY 2013 slated for a $14 million reduction and the VCF’s $322 million budget authority reduced by $24 million.  Not only would these cuts be devastating for the victims that need assistance, we are concerned that OMB has not fully investigated the facts under which these programs operate.  

For example, the 7.6% sequester estimate was applied to the total $190 million health program instead of subtracting the 10% payment volunteered by the City of New York prior to calculating the cut.  Pursuant to the PAYGO Statue, Section 11(g) ‘‘Activities financed by voluntary payments to the Government for goods or services to be provided for such payments” are exempt from sequester.  The City of New York has voluntarily agreed, through a memorandum of understanding (MOU), to pay a 10% share for the program.  Therefore, including their portion of the funding violates the sequester process. 

In addition, as OMB is aware, the PAYGO Statute which was signed into law in February 2010 includes 150 exemptions.  Among the programs exempted are similar health and compensation programs that have been established for other injuries and illnesses such as: the Payment to Radiation Exposure Compensation Trust Fund, Radiation Exposure Compensation Trust Fund, Energy Employees Occupational Illness Compensation Fund, Vaccine Injury Compensation, Vaccine Injury Compensation Program Trust Fund, and the Black Lung Disability Trust Fund to name a few.  But the 9/11 health and compensation funds did not exist at the time the PAYGO Statute was enacted.  The James Zadroga 9/11 Health and Compensation Act, which established these funds, was not passed by the Congress until December 2010 and was signed into law by the President in January of 2011.  Clearly had the 9/11 Heath and Compensation programs existed in February 2010, when the PAYGO law was passed, they would have been included on the list of specific exemptions and therefore we request that both the health and compensation programs are excluded from sequestration.

Moreover, the James Zadroga 9/11 Health and Compensation Act, when enacted, was not only fully PAYGO compliant with a dedicated stream of revenue that fully pays for the program, but in fact provided an additional $433 million in deficit reduction, revenue above what the Act spent. Given that it was fully PAYGO compliant and in fact in the end will lead to over $400 million in deficit reduction we do not believe that subjecting the two programs to sequester is proper or consistent with the precedent set by similar health and compensation programs provided to injured workers.  

In conclusion, we know that the task before OMB is difficult and it is our sincere hope that Congress will find an alternative to sequestration.  However, as your report states on page one, “The estimates and classifications in the report are preliminary. If the sequestration were to occur, the actual results would differ based on changes in law and ongoing legal, budgetary, and technical analysis.” We therefore write to you in the hope of pointing out that we do not believe that Congress intended to have these two programs fall under sequestration.