As communicated to Council in late February, the Federal budget sequester was expected to impact the City’s revenues. The Budget Control Act of 2011 required the Federal administration to sequester FY13 discretionary funds. This included making across-the-board cuts of $1.2 trillion in savings over a ten year period beginning in 2013.
The City anticipated a 7.6% reduction to the Build America Bond (BAB) payments, which could have reduced the City’s payment by $30,021. However, the payment received from the federal government was $190,342, which was a reduction of only $18,138. Despite the reduced payment, issuing BAB’s will continue to save the City considerably as compared to issuing traditional tax-exempt bonds.