In face of federal shutdowns, local leaders take time to plan
By Stephanie Lulay and Kalyn Belsha firstname.lastname@example.org, email@example.com September 30, 2013 8:36PM
A federal budget impasse closed the government in 1995-96, including the Washington Monument. | File~AP
Updated: November 2, 2013 6:32AM
As Congress mulled, Fox Valley leaders were forced to plan.
As the possibility of a federal government shutdown loomed, local leaders — from heads of federal offices in the Fox Valley to chiefs of towns, schools and banks — pushed aside daily tasks to crunch numbers.
If the federal government shutdown, would the ripple effect be felt swiftly in the Fox Valley?
For some local agencies, a few-day government shutdown would have little to no effect on their day-to-day operations. But for others, the shutdown would curb activities immediately.
For those in line for a federal loan during a shutdown, the cash is put on hold until Congress can come to a resolution. All Fed-backed mortgage loans, tax refunds, Small Business Administration loans and student loans are not processed. Those in need of a passport could be stuck in limbo, too.
Under a shutdown, “discretionary spending,” which by federal officials’ definition includes operations at national parks and historic sites, would halt immediately Tuesday.
On Monday morning, Greg Rivara, didn’t know whether a federal government shutdown would halt unemployment checks in Illinois.
Rivara, a spokesman with the Illinois Department of Employment Security, a state agency 100 percent funded by the federal government, said his office had more questions for the government, even after weeks of planning by state agency officials.
“We’re still waiting for direction,” Rivara said Monday morning. By afternoon, he had an answer from the U.S. Department of Labor: the state would continue to pay unemployment benefits if the federal government shutdown.
“We expect to pay those benefits as long as there is someone in Washington, D.C. available to push these dollars to the state,” Rivara said.
If the shutdown lasted a few days, Rivara didn’t expect a few-day shutdown to affect unemployment benefits, but he said state officials would be working late into the night to analyze numbers and work out employee plans.
“There are still questions as to what we can and can’t spend money on during a shutdown,” he said.
Social Security payments to beneficiaries would also continue with no change in payments dates, according to Doug Nguyen, deputy regional communications director at the Social Security Administration.
But if the government were to shutdown for more than 21 days, as it did beginning in December 1995, Social Security, unemployment disability benefit payments could be delayed, warned officials in U.S. Rep. Bill Foster’s office Monday.
Under a shutdown, local post offices would operate as normal, too.
With quarterly funding in flux, Aurora Housing Authority Executive Director Keith Gregory said that employees have been engaged in budget sessions, awaiting word from U.S. Department of Housing and Urban Development. If the quarterly funding came through, about a week later than expected, the agency would be fully funded through December. If not, the AHA would have to tap into cash reserves.
Gregory received word Monday that the quarterly federal dollars, 96 percent of the agency’s operating budget, was approved. The agency keeps about four months of operating cash in reserve.
“The way it looks right now, this would have to go on well into the spring before we’d have to seriously look at the loss of funding,” Gregory said
Despite the federal government shutdown, all air traffic controllers and technicians working at the Chicago Air Route Traffic Control Center at 619 Indian Trail Road in Aurora will stay on the job, said Tony Molinaro, FAA spokesman.
“Safety is our top priority,” Molinaro said. “The FAA continues to support President Obama’s Fiscal Year 2014 budget, and strongly believes that Congress still has time to act and a lapse in appropriations should not occur.”
According to a plan developed by the Department of Transportation, out of 46,070 total FAA employees, approximately 15,5134 would be furloughed. Molinaro, a federal spokesman, confirmed that he would not be on the job Tuesday if the government shuts down.
A shutdown would also not affect day-to-day operations at the Kane County Veterans Assistance Commission, but it could cause some delays on the VA side, said Jake Zimmerman, superintendent of the organization.
“We will continue doing everything the same,” Zimmerman said Monday. “The VA is a massive bureaucracy so some of those services are described by them as essential whereas others are not.” He also noted that the VA has a contingency plan in place for any shutdown.
Fermilab spokesman Andre Salles said the Batavia-based national research lab’s employees would be at work Tuesday, shutdown or not.
If the federal government shuts down Tuesday, public schools and universities likely won’t feel the effects right away, even though the Department of Education plans to furlough more than 90 percent of its staff in the first week.
According to the department’s contingency plan, last updated on Friday, $22 billion in federal education funding normally paid on Oct. 1 already has been approved and will flow to states regardless of a shutdown.
That includes Title I dollars for low-income districts, Title II dollars for teacher and principal training, money for special education services for students ages 3 to 21 and funds for career and technical education.
Federal Pell Grants and Direct Student Loans for college students “could continue as normal,” according to the plan.
West Aurora spokesman Mike Chapin said 9 percent of the school district’s total funding comes from the federal government. The cash primarily funds supplies and services for Title 1, school lunch and special education programs.
“We get paid by the federal government after submitting expenses. We will be submitting expenses for the first quarter of 2014 and part of 2013 later in October,” Chapin said.
If the shutdown continued and the school district was not reimbursed in a timely manner, the district would most likely slow down on purchases of supplies, or temporarily cover the costs with revenue from other sources, like Local property tax dollars.
In Carpentersville-area Community Unit School District 300, spokesman Allison Stupeck said a government shutdown would not affect funding.
“We would not initially anticipate any impact on our school system,” Stupeck said.
But if the shutdown goes on longer than a week it “would severely curtail the cash flow to school districts, colleges and universities, and vocational rehabilitation agencies that depend on the Department’s funds to support their services,” according to the DOE plan.
Jeff McLaughlin, manager of Aurora’s Neighborhood Redevelopment division, said a federal shutdown would not immediately impact the department because program funding is obligated by HUD through contracts. Aurora fronts payments to non-profit partners for the provision of projects and programs, and then requests reimbursement from HUD.
The office is keeping a close eye on the budget situation in D.C., he said.
“The largest impact, particularly if the shutdown is long term, is that reimbursements to the City may become delayed,” McLaughlin said.
Elgin City Manager Sean Stegall said a federal shutdown would not immediately impact Elgin, as the city does not receive any regularly scheduled payments or services from the federal government.
“With respect to the city’s federal allocation of Community Development Block Grant (CDBG) funding, HUD has issued a contingency plan stating it will ‘continue to disburse CDBG, HOME funds and other block grant funds in cases where failure to address issues result in a threat to safety of life and protection of property,’” Elgin Assistant City Manager Rick Kozal said. “The city’s CDBG funding cycle does not necessitate disbursements from HUD at this time”
Emily McFarlan Miller and Mike Danahey contributed to this story.