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Blogging for Change Blogging For Change
by Jesse Campbell on September 30, 2013

what happens when the government shuts down

For a lot of us, the national government is like indoor plumbing – you don’t think about it all that much until there’s a problem.

Well, here’s a problem: if the United States Congress does not pass a new spending bill before the previous bill expires, then the government is legally prohibited from spending money, resulting in a government shutdown.

The fiscal year runs from Oct. 1 through Sept. 30, meaning a new spending bill must be passed before midnight on Sept. 30th. There have been 17 shutdowns since 1977. Most last only a few days. The longest was the last shutdown, which ran from Dec. 16, 1995 to Jan. 5, 1996.

Obviously, if you work for the federal government, a shutdown could mean no work and no pay until the situation is resolved. Even if you aren’t an employee of the federal government, however, a shutdown of the national government could be more than a minor inconvenience. Here’s a quick rundown of all the ways a government shutdown could impact you.

You could be put on furlough

This is only a concern if you work for the Federal government. All employees deemed “essential” would maintain their jobs at full capacity. Each government agency creates their own contingency plan and names which positions they consider essential. Those contingency plans are then reviewed by the White House.

Workers deemed to be necessary to the protection of public health and safety are considered to be essential, but that includes the protection of both citizens and property, which may include important data or other intangibles. (All active duty military members are considered to be essential.)

Ultimately, CNN estimates approximately 783,000 or more workers would be placed on furlough – a little less than 25 percent of the 3.3 million government workers.

National parks will be closed

All 368 sites within the National Park Services will be closed, with no services available. Anyone camping in a national park will be given two days to leave.

Passport services may be reduced

According to the Department of State, all consular services will remain open as long as the revenue from fees is sufficient to maintain operations. These services will likely experience a significant slowdown, however, even as they remain open.

Tax refunds will be delayed

If you filed an extension on your tax returns, those extensions expire on Oct. 15, which means that a fair number of returns are filed in the fall. Those returns – if submitted as paper returns – would face delays in processing, resulting in a delay in refunds being generated.

IRS audits will be suspended

All audit activity conducted by the IRS would be suspended during a shutdown. Additionally, walk-in taxpayer assistance centers and telephone hotlines would be closed.

New federally-backed loans will be frozen

Federal loans for things like small businesses will not be processed during the shutdown, however, both the Federal Housing Administration and the Department of Veterans Affairs have stated that FHA and VA loans will still be approved and administered during a shutdown. Those departments may not be running at full capacity, though, meaning delays are likely.

What won’t happen?

  • The Post Office will not close – the USPS functions as an independent business unit.
  • Social Security benefits will still be administered – although certain administrative functions (such as requesting a new SSI card) will be delayed or discontinued during the shutdown.
  • The Supplemental Nutrition Assistance Program (SNAP) would not be impacted at this time.
  • The Special Supplemental Nutrition Program for Women, Infants and Children (WIC) is administered on the state-level, and should not be affected.
  • Food inspections will continue.

Whether or not a shutdown actually occurs this time around, it’s important to understand the potential outcomes and how you might be impacted. If you’ve been financially impacted and aren’t sure how to cope, counselors are available 24/7 to discuss your issues and help you find a solution.

Comment(s)

Richard Teeter says:
October 04, 2013

VA had some residual funds that were spread throughout this week, however, effective Monday COB, I will be furloughed unless an appropriation agreement is made. We are currently on the down-hill run for our debt-management... Only 8-10 months left ($9600). We are going to try and keep making our monthly payment of $1066.00 but things will be very tight.Thank you.Rick Teeter



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