How Will a Government Shutdown Affect Contracts?


How Will Government Shutdown Affect Contractors?If you’ve checked the news lately, you’ll see there’s a huge buzz about a government shutdown seeming eminent.  Everyone likely has questions, but contractors whose livelihood depends on payments from the Federal government are certain to be the most on edge in this time of uncertainty.

While we don’t have definitive answers, here’s the basic breakdown.  During a “‘shutdown” the government will cease funding to what it considers “nonessential” services.  So any contract which is meant to maintain the health and safety of the American people will generally not lose funding.  Also, contracts which have already received their funding prior to the shutdown should not be affected.

Is a contract you’re working on affected by the shutdown?  Prime contractors should have already been contacted by the Contracting Officer at the agency which awarded the contract concerning whether funding will continue in the event of a shutdown.  If you have not been contacted, we’d recommend giving them a call to find out if they will stop work on the contract until funding is resumed.

For more information or to find out how the shutdown is affecting other around the nation, check these links out:

Huffington Post – Government Shutdown 2013

Nixon Peabody Article from March

Government Shutdown Effect on Construction Contracts

Gawker Article:  How Government Shutdown is Affecting Contractors and Other Federal Employees

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