The Effect of a Federal Government Shutdown on Major State Grants

With just a few hours remaining before the beginning of federal fiscal year (FY) 2014, attention has turned to the possibility that Congress will be unable to agree to a continuing resolution (CR) to maintain funding for the federal government. A CR is necessary because no appropriations bills have been enacted for FY 2014. Last week, the House passed a CR that incorporated “defunding” of the Affordable Care Act (ACA; P.L. 111-148). In response, the Senate stripped the defunding provision from the CR and sent it back to the House, where new language was added to delay implementation of the ACA, and repeal its medical device tax. The Senate rejected these provisions in its latest vote, and it is unclear how the House will proceed.

FFIS has summarized the impact of the House CR (H.J. Res. 59) in Budget Brief 13-12. This brief discusses the impact of a federal government shutdown on major grant programs, should it come to pass.