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What a federal shutdown might do to your business

By Doug Caldwell
Central Valley Business Times
April 7, 2011

•  Tax refunds delayed and more

•  Lawmakers fiddle as the clock ticks

If the federal government “shuts down” Friday night at 9 p.m. Pacific time, here’s what might happen to Californians and their businesses. A caution about the list: It continues to change, there being no single source for all aspects of what will be impacted.

• About 170,000 people – the number of non-military federal workers in California – would technically lose their jobs

• Small business that sell goods and services to the federal government may find no one to take delivery, answer their calls – or send them a check

• With the Small Business Administration largely shut down, there would be no way to get approval for SBA-backed loans except for SBA disaster-assistance loans which are funded separately

• National parks, including those employing Central Valley workers such as Yosemite, Kings Canyon and Sequoia – would be closed

• The 27 Internal Revenue Service offices in the state would be closed

• Federal income tax refunds not already in the mail or slated for direct deposit will be halted

• But electronic tax filing will still proceed

• The U.S. Postal Service, an independent corporation, should function as it normally does

• Veterans Administration hospitals will stay open as normal as will federal prisons

• Military and border control operations as well as the TSA and air traffic control workers at airports, also deemed essential, are expected to continue without interruption

• The E-Verify program of the Department of Homeland Security, used by businesses in the hiring process, would be shut down

• Passports and visas would not be issued

• Social Security checks would go out as they normally do but applications and other services would be suspended

• Medicare payments and processing would continue

• Federal Housing Administration loan approvals would halt

• Review of environmental impact statements by the U.S. EPA would be ended for the duration

The Republican majority in the House of Representatives is demanding a $61 billion cut in spending in the current budget year before they will consider passing a measure permitting the government to spend money past Friday at midnight Eastern time.

“A government shut down would clearly have a major impact on small businesses all across the country. The federal government is the largest purchaser of goods and services in the world, and shutting down the flow of government dollars to small businesses may ripple across nearly every industry and cost countless jobs,” says Lloyd Chapman, president of the American Small Business League of Petaluma.

“Our President and Congress allowing the government to shut down would be just another major indicator of the gross incompetence that exists in Washington today,” Mr. Chapman says.

However, there are 535 federal employees who will continue to get paid: the members of Congress, who are paid an average of $174,000 a year.

Source: http://www.centralvalleybusinesstimes.com/stories/001/?ID=18091



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