Federal Relations

September 29, 2013

Impacts of Potential Government Shutdown

At this point, it does appear that we are headed for the first government shutdown in 17 years. The House amended and approved the CR that the Senate sent to them on Friday, so that bill now goes back to the Senate. But because the House amended bill contains language to delay implementation of the health care law, Senate Democrats are not likely to accept that language. At this point, it is anticipated that the Senate will attempt to amend the bill (AGAIN) to strip out the health care implementation delay but certain Senate Republicans are expected to object to that process and therefore prevent the bill from further consideration. They will work on this all day Monday, and then admit defeat sometime late Monday night.

So, what should we expect? The Office of Management and Budget (OMB) is the best place to get up-to-date information on how individual agencies will respond to shutdown. They now have a web page that includes the list of contingency plans for each federal agency.

The good news is that the Pell Grant programs and other federal student aid programs (grants and loans) will continue to operate through a government shutdown.

Normally, routine, ongoing operational and administrative activities relating to contract or grant administration (including payment processing) cannot continue when there is a gap in funding. Therefore, agency employees who are paid with annual appropriations and who perform an activity associated with contract or grant administration (including oversight, inspection, payment, or accounting) should generally not continue work during a funding hiatus.

However, active grant and contract activity funded with FY2013 (or prior year) appropriations can continue. However, agency personnel most likely will not be available for approvals, supervisory support, and other administrative functions.

The Office of Federal Relations will continue to monitor this situation. There won’t be much action again until Monday so we’ll know more in 24-36 hours.