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New Starts, Federal Transit Administration (FTA) and Hurricane Sandy relief funding could all face cuts under the "sequestration" federal budget-cutting process that began March 1, according to an American Public Transportation Association (APTA) Legislative Update.

Currently, the Highway Trust Fund, including the Mass Transit account, is exempt from the sequestration, so the formula funding to transit agencies should not be impacted, the Update stated. However, the federal General Fund transfers to the Highway Trust Fund, and programs financed through the General Fund — such as New Starts, FTA operations, FTA Research and Hurricane Sandy emergency relief funds — are subject to sequestration cuts, APTA said.

Sequestration kicked in March 1 after Congress and President Barack Obama could not reach an agreement under the Budget Control Act. Initially, the act was considered a "last resort" option that would not come to fruition, but would force Congress and the Obama administration to reach an agreement on federal deficit reduction in order to avert large cuts to defense and non-defense programs. The sequestration provision requires across-the-board spending cuts of $1.2 trillion.

Final numbers will be subject to the Office of Management and Budget's report to federal agencies, but according to the Congressional Budget Office, the revised automatic spending cuts for discretionary programs in 2013 will amount to a 5.3 percent cut, according to APTA.

"While Congress continues to grapple with sequestration, it will also need to address the remainder of fiscal-year 2013 appropriations," the Update stated. "The federal government continues to operate under a continuing resolution that largely extended FY2012 funding levels, although the continuing resolution did provide funding consistent with the New MAP-21 authorized program structure."

The current continuing resolution is slated to expire on March 27, which leaves Congress with less than four weeks to pass remaining appropriations bills, provide another continuing resolution or wrap up FY2013 appropriations intone an omnibus appropriations bill in order to avoid a federal government shutdown, the Update stated.