Lawmakers on Capitol Hill could strike a partial budget deal to temporarily avert a government shutdown “as soon as today,” a source familiar with the negotiations said Wednesday.
Negotiators are working on an agreement for six funding bills, four of which expire Friday.
Congressional leaders have been optimistic so far about getting the deal settled, especially after a Tuesday White House meeting with President Joe Biden and Congress’ top four leaders, including House Speaker Mike Johnson, R-La.
“We are very close to getting it done,” Senate Majority Leader Chuck Schumer, D-N.Y., said Wednesday on the Senate floor.
But a partial shutdown is still not out of the question.
Should negotiations end Friday without a deal agreed upon, Johnson does not plan to sign a short-term spending bill to keep the government fully open this weekend, according to the person familiar.
The source said if talks “fall apart, there could be a shutdown.”
A partial shutdown would impact several government agencies, including agriculture, Veterans Affairs, transportation and housing. The rest of the government is due to run out of money on March 8.
Once a deal is reached, Johnson has agreed to a short-term spending bill, called a continuing resolution, to push the first funding deadline to March 8 and the second to March 22.
“Any CR would be part of a larger agreement to finish a number of appropriations bills, ensuring adequate time for drafting text and for members to review prior to casting votes,” Johnson Press Secretary Athina Lawson said in a statement.
What a partial shutdown looks like
If the four funding bills do expire Friday, their corresponding agencies would shut down Saturday at 12:01 a.m.
Budgets for Medicare and Social Security would be left untouched, as they are not funded by appropriations bills. And government shutdowns do not tend to move markets significantly, though they can stoke perceptions of economic uncertainty.
The immediate impact is felt most harshly in government halls.
A partial shutdown would leave those agencies’ roughly 100,000 federal employees without pay for any new work during the shutdown, whether they are furloughed or not. Those workers are legally required to receive back pay when the government is back up and running.
But some contract workers do not enjoy back-pay protections and may not get reimbursed for unpaid work during a shutdown.
“A lot of the subcontractors are never made whole, so a lot of the janitorial staff and cafeteria staff,” said Bobby Kogan, a former budget adviser under Biden.
“You talk to people around D.C., there are a gillion people who have lost and never been made whole during a government shutdown.”
Besides pay roll, day one of a government shutdown looks different depending on the agency and the program, according to Kogan.
For example, most of the Department of Housing and Urban Development’s fair housing-related activity “will stop right away,” according to Kogan. That means that housing discrimination cases will take longer to adjudicate.
The Department of Agriculture would also specifically halt most of its Rural Development loan and assistance programs during a shutdown, which could delay funding for health care, emergency response and other services within rural communities.
Many veterans programs will remain funded since much of their budgets are penciled in a full year in advance, which keeps them largely protected from shutdowns. However, the legal services arm of Veterans Affairs, would halt, according to Kogan.
But these are day-one effects. The longer a shutdown carries on, the worse it gets.
“If it goes long enough, our states are going to start freaking out and backing out of their own programs,” said Kogan. “Shutdowns are bad, but the longer and longer they go, they become disasters.”
