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Latest on Goverment Shutown: How Many Millions Will It Cost Virginia and DC?

Federal workers, local businesses wait to see what Capitol Hill will do.

U.S. Capitol building; photo courtesy of Architect's Office.
U.S. Capitol building; photo courtesy of Architect's Office.
A government shutdown could cost the region millions in lost revenue — upwards of $200 million a day, according to an economist at George Mason University, the Washington Post reports.

In addition to local economies taking a hit from losing tourist dollars if federal museums and parks close down, DC and Northern Virginia are home to thousands of federal workers who won't get paid if the government is shut down, meaning less spending at local retail and dining spots, said the economist, Stephen Fuller, director of George Mason University's Center for Regional Analysis.

Northern Virginia has about 65,000 federal employees who live in the area, and there are about 110,000 federal workers who work in Northern Virginia, according to Congressman Jim Moran's (D-8th) office.

The region could be hit hard by lost income tax revenue from tens of thousands of idled federal workers, the Washington Post story points out. Local governments have set aside funds in anticipation of a possible shutdown. Arlington County set aside $3 million, and Fairfax County has $8 million, the newspaper reported. 

In Fairfax County, one of the wealthiest in the nation, a looming shutdown is a big question mark for local government.

"We have discussed possible impacts on Fairfax County, but it is unclear at this time what this would mean for Fairfax County," said spokeswoman Merni Fitzgerald. "No detailed impact analysis has been done because there are too many unknowns." 

One concern is how a federal government shutdown would impact the local economy, Fitzgerald said. Some of the questions unanswered, she said, are:
  • The length of the possible shutdown.
  • Whether furloughed federal workers would be retroactively paid.
  • Would there be a delay in processing federal grants?
  • Would the loss of daily federal commuters impact Metro revenues?
  • Would a shutdown and loss of income to federal workers who live here in Fairfax County lead to foreclosures? 
  • Would there be more need for local social services for federal workers on the margin?
  • Would a federal government shutdown cause people to stop buying things and thus reduce our sales tax revenue?
  • Would a federal government shutdown impact business and sales tax revenue related to those segments of our business community that receive federal contracts?
  • How would a shutdown impact the bond market?

"These questions and others might not be resolved immediately, since many are based on the amount of time the federal government could possibly be shut down and whether or not any furloughed federal employees would be reimbursed," she said. "We will continue to stay informed about this and other issues that could possibly impact the county budget."

Local lawmakers, mostly Democrats, blame Republicans for "holding the country hostage," Congressman Gerry Connolly (D-11th) said Monday morning. 

Republicans are attempting to make changes to the Affordable Care Act aka "Obamacare" set to roll out Tuesday. "It is wrong to do a shutdown of government as the leverage to make change," Sen. Tim Kaine, D-Va., told "Fox News Sunday."

"It's like mass psychosis has taken over the GOP" and they're holding the country hostage, said Connolly on MSNBC's The Daily Rundown program.

"We’ve wasted a week on political shenanigans while every minute we wait brings us closer to a govt shutdown, which will hurt economy and unfairly punish Virginia workers and families," Sen. Mark Warner (D), said Friday, also on Twitter. "We cannot allow ideological issues to stop us from funding basic operations of government and we should be working to get the nation’s fiscal house in order."

“House Republicans have announced their intentions to move forward with a plan they know will shut down the government,” Moran said Saturday. “The Republican majority has campaigned time and again on the premise that government doesn’t work and these theatrics only serve to fulfill that pledge.”

“This maneuver will leave nearly a million federal employees without a paycheck in two weeks, jeopardizing our economic recovery and further eroding confidence in this institution," Moran said.

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