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Texplainer: What Happens To Texas If The Feds Shut Down?

Not much, unless you're one of the state's 130,000 civilian federal employees — or you’re scrambling to get your taxes done.

U.S. Congress


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Hey, Texplainer: If Congress and the White House can’t break their deadlock on the budget by midnight tonight, the federal government will shut down. What does that mean for Texas? 

Short answer: Not much, unless you're one of the state's 130,000 civilian federal employees — or you’re scrambling to get your taxes done.

If the 2011 shutdown happens it will likely only last for a few days. That's not enough time to disrupt payment for essential federal funding, which is usually doled out on a monthly or quarterly — not daily — basis. And most federal dollars that flow to programs like education and transportation are either forward-funded from the year before or reimbursed retroactively. (Impact Aid, money that goes to schools with federal property in their districts, is an exception.) Federal district courts have enough non-appropriated revenue to stay open for two weeks if the government closes. Social Security payments will continue.

But a shutdown would directly affect the 130,000 Texans who work for the federal government in a civilian capacity. They'll be furloughed, but in the past they have received their salaries after the fact. “Essential employees,” those who work in defense and public health and safety — like military personnel, border patrol agents and federal prison guards — are exempt, but military bases would still lose the services of their “non-essential” civilian staff. It would also shutter the state’s 14 national parks and historic sites, which, especially over a spring weekend like this one, could cost them in tourism dollars.

Economic impact on the state would be indirect — relating to furloughed federal employees’ loss in spending power or holdups for businesses waiting on federally guaranteed loans. Agricultural export and trade monitoring would also end, which would affect activity along the Texas-Mexico border.

And if you are waiting on a passport or tax refund, or are filing paper tax returns, even turning out the lights for a few days at the State Department and IRS service centers will cause some delays.

Of course, it’s possible that the shutdown could last more than a few days. During the 1995-1996 shutdown, the government closed its doors for three weeks. And the longer it lasts, the greater the impact on the state.

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