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Federal government shutdown won't affect Missourians - Yet

JEFFERSON CITY - The budget battle in Washington won't have any major state casualties so long as the war ends soon, state administrators say.

In other words, the federal government shutdown will not directly affect Missouri's economy - not for the next two weeks, anyway.

"We don't anticipate any difficulties, at least for the rest of this month," said Chris Kelly, chairman of the Missouri Labor and Industrial Relations Commission.

For now, state agencies are relying on state money to replenish what the federal government usually supplies.

"Most agencies that receive federal money would have matching state money so for a short period of time they could switch over to the matching money," said Dick Hanson, commissioner of the state's Office of Administration. "But that won't work for a whole year."

Mark Ward, Directory of the Budget and Planning Division, said that depending on the length of the shutdown there could be problems.

"If it continues it will have a significant effect on the economy," Ward said. "It will increase unemployment in the federal sector and there will be spill-over effects into other sectors as well."

The longer it takes to resolve the budget fight, the less there will be for federal employees to spend on consumer and luxury items, services and activities. The loss of revenue would affect the economies in those areas.

Although the economic impact of the shutdown won't be felt in the state's economy for awhile, the pocketbooks of the federal employees who were sent home Tuesday will be affected when payday rolls around.

"The more direct effect is on federal employees deemed inessential," Ward said. "Those people are feeling the full brunt of Congressional inaction right now."

State officials just hope the budget squeeze is only temporary.

"If it doesn't last too long it shouldn't have an effect besides not accessing federal programs," Hanson said, "but through the state programs, there won't be much of an effect for a while."

Hanson said all state agencies have contingency plans to keep them alive through the shutdown.

"The contingency plan is agency by agency - some departments are highly dependent on federal funds, some just a little," he said.

State agencies that receive the most federal money are the Social Services, Mental Health, Natural Resources, Elementary and Secondary Education, and Public Safety Departments, Hanson said.