What's the latest on the latest (possible) government shutdown

The U.S. House of Representatives and Senate are facing a Sept. 30 deadline

Congress remains divided on how best to fund the federal government. If lawmakers fail to reach an agreement before Saturday, spending authority for most federal agencies will expire and the federal government will shut down.

The Senate is trying to pass a short-term, bipartisan resolution to keep the government running. It would likely exclude any policy provisions that do not already have broad bipartisan support. For its part, the House is trying to advance a handful of year-long spending bills with Republican backing alone.

The League of California Cities is working with the National League of Cities (NLC) to urge Congress to support the bipartisan resolution currently under consideration in the Senate. However, without a dramatic change in direction, a shutdown is likely. 

What would a shutdown mean for local governments?

A government shutdown could create significant challenges for cities as they navigate impacts to basic programs, such as funding for supportive services, disaster response, infrastructure projects, and environmental reviews.

These impacts could also extend to the historic funding cities received through the American Rescue Plan Act (ARPA). The deadline to spend those funds is Dec. 31, 2024. City staff have been working closely with the U.S. Treasury Department staff to navigate ARPA’s complicated rules. If the federal government shuts down, the Treasury Department would have to furlough those workers. That could lead to project delays.  

State-level employees funded by federal dollars could also be furloughed, creating even more uncertainty for cities.

It's impossible to know how long a government shutdown would last. Some have lasted a little over a week. The most recent shutdown lasted 34 days. Either way, a government shutdown would create unnecessary fiscal uncertainty at a time when many cities are still recovering financially from the pandemic.

For more information about how a government shutdown could impact your city, please refer to the following resources:

• Why a government shutdown is complex for state and local governments
• Federal agency contingency plans for a lapse in appropriations
• Government shutdowns and executive branch operations: Frequently asked questions

For questions, please contact Legislative Affairs Lobbyist Caroline Cirrincione.