WASHINGTON -- A congressional leader arranged an $8 million federal grant to his alma mater two weeks ago, but that small act may end up setting off spending cuts in a wide range of domestic programs.
Representative Dan Rostenkowski, D-Ill., chairman of the House Ways and Means Committee, arranged the grant for Loyola University of Chicago as part of $4.5 billion legislation to cover U.S. military expenses in the Persian Gulf.
The grant, which would go toward a $24 million Center for Commerce and Industrial Expansion at Loyola's business school, was one of several non-military items in the bill.
The money for Loyola had been put into the Pentagon's budget, but because of concerns by the university that it would be required to conduct military-related research, Mr. Rostenkowski won approval to shift the money to the Education Department's budget. The congressman attended Loyola from 1948 to 1951.
The revision does not change overall government spending. But, the Bush administration now says, the shift from military spending to domestic spending, a separate category in the federal budget, means the government will exceed its $189.2 billion spending authority on domestic programs by $7.3 million.
In a letter to congressional leaders Friday, Richard G. Darman, director of the Office of Management and Budget, warned that the shift could set off automatic across-the-board spending cuts, or what he referred to as a sequester, of $40 for every $1 million in spending on domestic programs.
To avoid the automatic cuts, he said, Congress would have to reduce domestic spending by $7.3 million to stay within the domestic spending limits.