State Budget Director Linda Luebbering said the federal government shut down will hit state programs with a loss of funding if it is not resolved within a few weeks, but a Congressional failure to compromise on how much money the United States can borrow would be more catastrophic.
"The federal debt limit will have a much more immediate and broad-spread impact," Luebbering said. "The budget discussion is not as widely spread and will take a little more time to work through the system and impact everything."
Some of the departments Luebbering said could lose funding for some of their programs are education, public safety, senior services, and transportation because of the government shut down.
"The state has some federal cash still available that we've already brought down, and we'll be able to continue those programs at least for a very very short time period," Luebbering said.
Congress has until mid-October to reach a deal on the "debt ceiling" before the government loses the ability to borrow money, and programs face an immediate loss of funding. Luebbering said if Congress fails to meet that deadline, even programs like Medicaid and unemployment benefits would face a loss of funding.
"If the debt limit is not worked out, there won't be federal funding available for much of anything," Luebbering said. "We've not gotten specifics from the federal government yet about exactly what that would mean, but we do believe that that would have a larger impact on our program."
Luebbering said the shut down will hit different programs with varying levels of funding cuts depending on how much of the departments are funded by federal grant money.