Impacts for Transportation If the Federal Government Shuts Down

As the federal government approaches another threatened shutdown on September 30 at midnight, federal agencies are preparing to cease all non-essential operations funded by discretionary spending. A shutdown would remain in effect until either a Continuing Resolution is passed or an appropriations bill is enacted.

Traditionally, many toll operators have not relied heavily on federal funding. In fact, most IBTTA members receive little to no federal financial support. However, certain Infrastructure Investment and Jobs Act (IIJA) programs did attract toll operator interest and grant awards.

In the event of a shutdown, essential services funded through discretionary spending (such as certain medical services, federal law enforcement, air traffic control, and border protection) would continue. Programs and accounts funded by mandatory spending, such as Social Security, Medicare, and trust funds like the Highway Trust Fund (HTF), would remain unaffected.

For IBTTA members, this means that U.S. Department of Transportation (USDOT) activities supported by HTF contract authority would not be disrupted. Additionally, programs funded by IIJA’s five-year advance appropriations from the General Fund would also continue to operate. Since these sources fund the majority of federal highway, transit, and highway safety programs, most of these programs will be insulated from a shutdown.

There is one change from previous shutdown deadlines. The Office of Management and Budget (OMB) recently released a memo instructing all federal agencies to develop plans to initiate the dismissal of employees determined to not be necessary to meet the goals and objectives of the White House. We do not yet have details from USDOT on how this OMB memo will impact programs important to IBTTA members.

While the direct impact of a federal shutdown on transportation programs relevant to IBTTA members may be limited, a prolonged shutdown could have broader economic consequences. For instance, the five-week shutdown from 2018 to 2019 resulted in an estimated national economic loss of $3 billion, according to the Congressional Budget Office.
The IBTTA Government Affairs team will continue to monitor the situation closely and keep members informed of any significant developments. 

If you have any questions, please contact Mark Muriello at [email protected].