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Congress is responsible for passing annual appropriations to fund government agencies. If Congress neglects to pass funding bills, government agencies are forced to shut down. Follow all of Federal News Radio's government shutdown coverage from the past several years.
Government shutdown cost feds 6.6 million days of work
Thursday - 11/7/2013, 2:55pm EST
The 16-day government shutdown forced federal employees to miss millions of days of work, agencies to forego millions of dollars in revenue and programs to grind to a halt.
In a new report issued Thursday, the Office of Management and Budget estimated both the economic, programmatic and budgetary costs of the longest closing of government since 1995.
OMB estimates that federal workers missed 6.6 million days of work and the shutdown cost more than $2.5 billion in lost productivity and pay and benefits for employees, most of which didn't work.
OMB Director Sylvia Mathews Burwell said that $2.5 billion is one of the biggest measurements used to signify the impact of the shutdown. "Overall, federal agencies furloughed roughly 850,000 employees per day in the immediate aftermath of the lapse in appropriations, or roughly 40 percent of the entire civilian federal workforce," the report stated. "Those employees that were not furloughed were retained either because they were performing activities that are 'excepted' under the applicable legal requirements (such as activities necessary to maintain the safety of life or the protection of property), or because funding remained available to pay their salaries and expenses during the lapse from sources other than annual appropriations."
The Defense Department lost the most days, 1.6 million, followed by the departments of Treasury (985,000), Agriculture (737,000) and Interior (646,000).
Burwell said OMB used a formulaic approach to figure out the costs. Agencies submitted the number of employees under furlough and OMB multiplied it by the average salary by agency to get the total 2.5 billion dollar figure.
"The other thing this does not cover is the issue of all the preparation leading up to and what happens post [shutdown]," Burwell said Thursday during a briefing with reporters. "As I'm sure you can imagine, there was a lot of preparation that went into taking care of preparing for the shutdown and actually doing the shutdown, so those were thousands and thousands of man hours across all the agencies and departments, and as we moved to reopen things, we had those costs too."
She added the report also tried to detail the impact on the workforce in the short term and long term in terms of recruitment and retention. OMB stated the shutdown and sequestration-relate furloughs undermine the competitive advantage the government has in hiring workers.
OMB's report also details lost revenue among agencies, such as the Smithsonian, which is estimated to have missed out on $4 million in additional revenue, and the National Park Service, which missed out on $7 million in revenue as well. The IRS couldn't collect $2 billion in taxes, and the Social Security Administration delayed completing 1,600 medical disability reviews and 10,000 Supplemental Security Income redeterminations.
She said the National Science Foundation had to put basic research on hold because it furloughed 98 percent of the staff.
"To give you a sense of that, on average NSF issues about 765 grants and continuations in a two-week period so you can get a sense of the magnitude of something like that from a programmatic sense," Burwell said. "The other thing I want to highlight is the other direct budgetary costs. That came in things like uncollected fees at national parks. The National Park Service estimated that it was unable to collect about $450,000 a day."
The federal government also had to pay additional interest on payments that were late because of the shutdown under the Prompt Payment and Cash Management Improvement acts, Burwell added.
Burwell said programs didn't bounce back right away either. It took more than a week to restore normal operations at the National Nuclear Security Administration, and it could take more than a week to restore operations at some Energy Department labs and plants, where they also lost three weeks of mission work.
Burwell said the report shows that there are a number of negative ramifications because of the shutdown, including on the economy and government efficiency.
"The impacts that occurred because of programmatic things that were occurring that affect people's daily lives whether those are their economic lives or their personal lives," she said. "By doing the report, [we wanted to] make sure there was clarity about that."
And it's not just federal employees not being at work that cost the government. OMB estimated that 10,000 contractors faced stop work orders and temporary layoffs. And those stop work orders could cost the government additional millions of dollars.
"Federal acquisition regulations allow contractors to request equitable adjustments for certain cost impacts associated with having to put operations on hold (e.g., costs of maintaining idle facilities, unabsorbed overhead)," the report stated. "There could be thousands of requests from contractors seeking to be reimbursed for costs incurred as a result of these suspensions."