Capitol Corner: Impacts of the Federal Shutdown
On the evening of September 30, 2025, the Senate rejected the Republican-sponsored Continuing Resolution (CR) (H.R. 5371) by a vote of 55-45 and the Democrat-sponsored CR (S. 2882) by a vote of 47-53. Since neither measure reached the 60 votes needed to pass in the Senate, the federal government entered its fourth shutdown of the 21st century.
It appears unlikely a compromise agreement will be reached quickly. Since Congress has not enacted any FY 2026 appropriations bills, the shutdown applies to all departments and agencies across the federal government.
Federal government activities funded by permanent, mandatory or advanced appropriations will continue. Examples include Social Security, Medicare, Medicaid, Supplemental Nutrition Assistance Program (SNAP) and veterans’ healthcare benefits. Activities supported by user fees or trust funds may also continue.
The Office of Management and Budget (OMB) may also deem certain activities to be essential to protecting human life or safety or property, to discharging the President’s constitutional duties or power or to performing statutorily required activities. The OMB has significant discretion in defining and interpreting how these exemptions are applied.
In the past, federal agencies posted their shutdown contingency plans on the OMB’s website. However, the OMB directed federal agencies to post their approved contingency plans exclusively on each agency’s own website.
As in prior shutdowns, impacts are expected to include furloughed federal employees, delays in services and program administration, disruptions for federal contractors and financial uncertainty for families and communities. Though, historically, federal employees have received back pay once funding is restored. More information about specific agency guidance and an overview of the impacts from a federal government shutdown can be found here.
