Chances are increasingly likely that Congress will be unable to pass a continuing resolution through both the House and Senate that can besigned into law by the President before the end of the fiscal year (FY) on September 30, creating what we call a “government shutdown.” Below we cover what a government shutdown means and the implications for many of the federal government programs impacted by a shutdown.
Most functions of the federal government are funded through the annual appropriations process that consists of 12 individual appropriations bills. If Congress fails to pass all of them by the end of the fiscal year on September 30, Congress must pass a continuing resolution (CR) to ensure the agencies and the programs those bills administer have funding to keep operating.
Prior to a lapse in appropriations, the Office of Managementand Budget (OMB) circulates guidelines to all federal agencies on how to prepare for and operate during a government shutdown. The guidelines are contained in a document known as Circular A-11 that is updated regularly. Each agency head must determine which functions can remain in place during a lapse in appropriations. As part of this process, agency heads determine which workers are considered “essential” and need to report to work during a lapse in appropriations and which employees are considered “non-essential” and, therefore, will be furloughed during a lapse in appropriations. There are a number of federal programs that are not funded by annual appropriations bills and, therefore, are not disrupted during a government shutdown. Such programs include Social Security, Medicare, the Supplemental Nutrition Assistance Program (SNAP), among other programs considered to be mandatory.
During previous government shutdowns, parks, monuments, recreation areas, and other public spaces operated by the National Park Service have been closed because park rangers are not considered essential employees. In past shutdowns, mine safety inspections have been halted as have safety inspections conducted by OSHA personnel. The Food and Drug Administration does receive funding directly from companies it regulates but that does not provide sufficient financing to keep the agency fully staffed during a lapse inappropriations and there are, consequently, delays in their review and approval of medications and medical devices they regulate.
In previous shutdowns, significant numbers of furloughed federal workers went unpaid. Should a shutdown occur this year, however, those workers will receive backpay after the appropriations are restored. After an extended government shutdown during FY 2019, Congress and President Donald Trump enacted the Government Employee Fair Treatment Act of 2019 (P.L. 116-1), which statutorily requires retroactive pay for furloughed employees following the end of a lapse in appropriations.
Past government shutdowns have endured anywhere from one day to 35 days. The latter starting on December 22, 2018, and ending on January 25, 2019. There is, at present, no way to know with certainty whether there will be a government shutdown this year or, if it occurs, how long it may last. The second longest shutdown lasted 21 days, starting on December 15, 1995, and running until January 6, 1996. The government shutdown of 2013 lasted 16 days.
Regardless of certainty or potential length, federal agencies have already been contemplating the possibility of a shutdown, scouring their current budgets, and making tentative plans. In many cases, the agencies will be putting final touches on their shutdown plans up until the final hours of September 30. As the fiscal year winds to a tenuous end, Prime will be monitoring Congressional negotiations and agency announcements and will be providing updated information, insight, and analysis.