The longest government shutdown in U.S. continues. The U.S. House of Representatives is out of session, and the Senate has repeatedly failed to pass a continuing resolution. Democrats are holding firm that any spending agreement must include an extension of subsidies under the Affordable Care Act, otherwise known as Obamacare, while Republicans argue that discussions on those subsidies should be kept separate from the funding negotiations. AGC has called on Congress to quickly pass a clean continuing resolution.
Impact on highway and transportation contractors. Highway contractors should mostly be unaffected because programs funded by the Infrastructure Investment and Jobs Act (IIJA) will continue uninterrupted. This includes programs funded by the Highway Trust Fund and advance appropriations for highways, airports, and transit.
Impact on direct federal contractors. For contractors performing direct federal work – such as with the U.S. Army Corps, Naval Facilities Engineering Command, or General Services Admin – the situation is more nuanced. Construction contracts already awarded on a fixed-price basis should be largely unaffected by the shutdown. However, for most cost-type contracts, time and materials contracts, IDIQ/MATOC/MACC contracts and those contracts that have yet to be awarded, the shutdown will likely suspend operations completely.
AGC breaks it down for you. Be sure to check out AGC’s Guide: What To Know in the Event of a Government Shutdown.
When will it reopen? Senate Republicans need a total of eight Democrats to cross over and support a short-term continuing resolution to reopen the government as Senator Rand Paul (R-Ky.) has been a consistent “no” vote. At this point, Senate Republicans need five more Democrats to cross over since they have already picked up three with Sens. John Fetterman (D-Pa.), Angus King (I-Maine), and Catherine Cortez Masto (D-Nev.). On the other hand, Democrats are insisting on negotiations for an extension of healthcare subsidies in exchange for voting to reopen the government.
Federal agencies have posted their shutdown plans:
· Department of Transportation
· National Telecommunications and Information Administration
· Environmental Protection Agency
· Small Business Administration
· Department of Veterans Affairs
· Department of Homeland Security
· NASA
· IRS
But there is an asterisk. There is a lot of room for discretion from the Trump administration, meaning they could halt projects based on politics. In addition, if the shutdown lasts beyond a few weeks, projects could face delays that require approvals or interactions with other agencies, such as environmental reviews and permitting. We have already seen threats of massive staffing cuts from the Office of Management and Budget, and we could see more announcements in the days ahead. Stay tuned, AGC will keep you updated on the latest developments.
For more information, contact Jordan Howard at Jordan.Howard@agc.org or (703) 837-5368.