Government Shutdown:

Permanent Funding Lapse Legislation Needed

GGD-91-76: Published: Jun 6, 1991. Publicly Released: Jun 28, 1991.

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Pursuant to a congressional request, GAO reported on the: (1) results of a questionnaire sent to government agencies in October 1990 on effects of a partial shutdown of the government during the Columbus Day weekend, and (2) potential effects of any future shutdowns.

GAO found that: (1) to avoid obligations of funds during a lapse in appropriations, the Office of Management and Budget (OMB) directed agencies to close down operations; (2) 6 of 22 agencies surveyed estimated that they authorized approximately $843,000 in compensation to employees who were regularly scheduled to work; (3) 7 of 22 agencies surveyed reported that the shutdown costs totalled approximately $3.4 million due to lost revenue, administrative costs for shutdown plans, compensation for time employees did not work, and salaries of nonessential employees for time spent devoted to the termination of operations; (4) the agencies reported that, had the government shut down for a comparable 3-day period during a normal work week, the costs and disruptions would have been much more severe; (5) legislation providing agencies with authority to obligate funds during a lapse in appropriations would have prevented disruptions in government services; (6) shutting down the government during temporary funding gaps was an inappropriate way to encourage compromise on the budget; (7) the shutdown did not convey an image of a well-managed government to the public; (8) forcing agency managers to choose who would be furloughed during temporary funding lapses severely tested management's ability to treat employees fairly; and (9) the shutdown disrupted government services and was counterproductive from a financial standpoint.

Matters for Congressional Consideration

  1. Status: Closed - Not Implemented

    Comments: GAO cannot predict the future likelihood of OMB ordering agencies to shutdown due to the lack of enactment of agency appropriation bills. The potential for such a shutdown order to encourage congressional compromise on the budget, however, remains an option for the executive branch to use in the future. To minimize the effects of any OMB shutdown order, the Congress should enact permanent legislation like GAO has recommended since March 1981.

    Matter: Congress should enact permanent legislation that authorizes agencies to incur obligations but not expend funds when agency appropriations expire. The only exception Congress should grant is when program authorization has expired or Congress has expressly stated that a program should be suspended during a funding hiatus pending further legislative action.

  2. Status: Closed - Not Implemented

    Comments: GAO cannot predict the future likelihood of OMB ordering agencies to shutdown due to the lack of enactment of agency appropriation bills. The potential for such a shutdown order to encourage congressional compromise on the budget, however, remains an option for the executive branch to use in the future. To minimize the effects of any OMB shutdown order, the Congress should enact permanent legislation like GAO has recommended since March 1981.

    Matter: Congress should, at a minimum, enact permanent legislation to allow agencies to incur obligations to compensate employees during temporary funding lapses but not pay them until an appropriation bill is passed.

 

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