Captains Call Kit on Continuing Resolution and Sequestration 
From Navy Office of Information  
WASHINGTON - With the budgetary uncertainty associated with the ongoing continuing resolution and the looming threat of sequestration, the Navy must begin seriously considering options to deal with what could be a $4-$9 billion shortfall in operating and maintenance accounts. It is exceedingly important that Navy leaders do all they can to ensure their people are as well informed about what it all means to them. The information and links below provide commanding officers with background information they can use to speak frankly with their people on these issues.

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CONTENTS:
1. CR/Sequestration Comm Points for CO's
(Added Feb. 7, 2013)
2. Plan of the Day Notes
(Added Feb. 7, 2013)
3. All Hands Magazine Interview with Navy Spokesman Rear Adm. John Kirby
(Added Feb. 7, 2013)
4. NavyLive Blog - CNO Guidance on Yearlong CR
(Added Feb. 7, 2013)
5. NavyLive Blog - Civilian Media Interviews with Navy Spokesman Rear Adm. John Kirby
(Added Feb. 7, 2013)
6. AFPS Release: Panetta, Dempsey List Consequences of Sequestration
(Added Feb. 8, 2013)

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1. Continuing Resolution and Sequestration Communication Points for Commanding Officers

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2. Plan of the Day Notes

Continuing Resolution Defined
The current continuing resolution (CR) went into effect Oct. 1, 2012 when a fiscal year 2013 budget was not passed. The CR limits federal spending to an amount equal to the previous year's budget amount (fiscal year 2012). On Jan. 2, 2013, the President signed the FY13 National Defense Authorization Act (NDAA), the budget for the Defense Department, but Congress has so far not passed the appropriation bill to fund it, leaving the Navy to continue to operate under the continuing resolution which expires March 27, 2013.

Continuing Resolution: The $4.6 Billion Bottom Line
The continuing resolution (CR) underfunds our FY13 operation and maintenance accounts by $3.2 billion. We've also incurred unplanned expenses in the amount of $1.4 billion since last year's budget was enacted. These expenses cover increased naval operations in the Middle East, increased fuel costs, as well as unexpected ship repairs. In total, our operation and maintenance accounts will come up $4.6 billion short.

Sequestration Defined
Sequestration is an element of law that requires automatic, across the board, nine percent budget cuts for all federal agencies if Congress cannot agree to legislation that reduces the federal deficit by March 1, 2013.

Sequestration: The $4-$5 Billion Bottom Line
The other side of the budget coin is sequestration. If Congress has not passed a deficit reduction bill by March first we will face an additional $4-$5 billion cut for this year alone, further reducing training and readiness. And because sequestration will be triggered in March - nearly half-way through the fiscal year - the Navy must absorb the additional cut in only a few months, requiring draconian reductions to the operation and maintenance accounts.

Continuing Resolution Impacts
With a focus on preserving the readiness of our forward-deployed forces, we must look for reductions in spending on fuel, parts, ship and aircraft repairs, base operations, and maintenance for buildings, roads and runways. Without a budget for this year, we may have to execute others, like reducing underway training for ships and aircraft not deployed.

Sequestration Impacts
Actions being considered to deal with this budgetary shortfall include cancelling all Caribbean and South American deployments and exercises, limiting European deployments to only those supporting ballistic missile defense missions, cutting the number of ships and aircraft deployed to the Pacific by half, cutting by 25 percent the days at sea and flying hours for all Pacific forces, and stopping stateside training and other operations for ships and aircraft preparing to deploy.

Continuing Resolution and Sequestration: What They Mean to Our People
Neither the continuing resolution nor sequestration will affect active duty pay, retirement, medical benefits, tuition assistance and family programs. Although many benefits are off the table, reduced maintenance, training, infrastructure repairs, and civilian pay all come at a price that will in part be borne by all of you. Continue to follow the news on these issues as closely as you can.

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3. All Hands Magazine Online sat down with Navy Spokesman Rear Adm. John Kirby to find out what Navy people and their families need to know about sequestration and continuing resolution. (Commanding officers are encouraged to use the below questions and answers in their online communication efforts. The video clips also serve as good examples of how they should be discussing the issue with their people and with the public).

What is the most significant impact of continuing resolution becoming a reality?
http://www.youtube.com/watch?v=18YZmY5flTw

What should Navy families do to prepare for continuing resolution and sequestration?
http://www.youtube.com/watch?v=VnYQk-AbAuE

What changes will our people see?
http://www.youtube.com/watch?v=a0wikf8aXLg

What are the most important things we need to know about CR and Sequestration?
http://www.youtube.com/watch?v=Cd-rRSIBPNA

What is meant by the authority to transfer funds between accounts?
http://www.youtube.com/watch?v=6sdMNi8aR1s

Is Navy leadership taking sequestration seriously?
http://www.youtube.com/watch?v=9EHp3di_tAQ

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4. NavyLive Blog - Chief of Naval Operations Guidance on Yearlong Continuing Resolution
http://navylive.dodlive.mil/2013/01/26/chief-of-naval-operations-guidance-on-yearlong-continuing-resolution/.

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5. NavyLive Blog - Navy Spokesman Rear Adm. John Kirby spoke with reporters from Norfolk, San Diego and Honolulu to discuss the impacts of sequestration and continuing resolution on the Navy and the communities in which it lives. (These video clips are another set of good examples of how commanding officers should be discussing the issue with media in their local areas).
http://navylive.dodlive.mil/2013/01/31/what-you-need-to-know-about-the-navys-current-budget-issues/.

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6. Panetta, Dempsey List Consequences of Sequestration
American Forces Press Service Release
http://www.defense.gov/news/newsarticle.aspx?id=119232
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