State can handle shutdown — for now
October 2, 2013
The head of Nevada’s Department of Administration says the state can handle the federal government shutdown for up to three weeks, but if it goes longer, there will be serious problems.
Gov. Brian Sandoval issued a statement saying he hopes Congress can find a way to move forward, adding, “however, if that does not occur, the state of Nevada is prepared.”
Jeff Mohlenkamp said that agencies could survive three weeks; that’s how long the shutdown lasted in 1995, when Speaker Newt Gingrich and the GOP House closed the government down.
“The biggest programs we’re worried about are SNAP (food stamps), TANF (Welfare) and WIC (nutrition for women, infants and children),” said Jeff Mohlenkamp. In addition, there could be problems for child nutrition, school lunch and commodity foods programs.
“These are critical services because if those don’t get funded, people don’t eat,” Mohlenkamp said.
He said Medicare, Medicaid, Social Security and unemployment benefits are mandatory instead of discretionary programs and will be funded through the shutdown.
“In the short run, we’re well-positioned to be able to manage, but anything beyond that (three weeks) poses more significant challenges for us,” Mohlenkamp said.
“One question we haven’t really gotten an answer to yet is whether this will be a delay or a reduction,” he said.
The difference is whether, when the government reopens for business, Congress make the states whole, replenishing the money they used to keep programs going during the shutdown.
Mohlenkamp said if the government decides those losses are a reduction that Congress won’t make up to the states, “all bets are off.”
“That would be a big problem,” he said, because the state will have used up what little reserves it has keeping essential programs going.
Mandatory program such as Medicare and Social Security are funded by preset factors and won’t be cut off. But discretionary programs can be hurt unless they are “forward funded.” Those include such programs as the Children with Disabilities programs and special education, which Mohlenkamp said won’t be affected — at least through the end of December.
“Disability services from DETR will have a short-term cash-flow problem, but we’ve been assured by the federal government they will make us whole so we’re continuing those services,” he said.
He said TANF funding (Welfare) will be cut off but that welfare division officials have assured him they have sufficient non-federal funding to handle a three-week shutdown.
“Some states are really worried about that,” he said.
He said the same is true for the food stamps program, which can survive a short shutdown with cash on hand. But the school lunch, school breakfast and other child nutrition programs are without funding during the shutdown.
Child Care Development is also cut off, as is the Low Income Home Energy Assistance program, but Immunization Grants will continue as will most Head Start programs.
While Medicare, Medicaid and unemployment services will continue, he said he has been advised there may be “some real challenges” for those not already on benefits.
“New access to services or modifying services could be very difficult,” he said.
Mohlenkamp said the departments of Transportation and Public Safety are largely unaffected, and there will be no disruption of critical services there.
He said the more global concern is what even a brief shutdown will do to consumer confidence. He said that could put the state’s economy back into a slump just when it was looking like it was in recovery.
“If there’s a real drop in consumer confidence, it could be serious,” he said.