Clock ticks toward federal shutdown, with impacts on Long Island and New York State uncertain

The U.S. government is moving closer to a partial shutdown next week that risks landing many of Long Island’s nearly 31,000 resident federal civilian employees on unpaid furloughs while halting or reducing a range of vital services and operations.

The possibility that Congress and the White House will reach a deal to keep agencies operating past a midnight Sept. 30 deadline is not gone. But it took a dire turn Tuesday, with President Donald Trump canceling a meeting with House and Senate Democratic leaders.

Trump objected in a social media post to their "ridiculous demands," and they hit back that he is running away from negotiations — all as Congress itself is not in session this week as the clock ticks.

"A federal shutdown is always a devastating prospect," said Russell Weaver, director of research at the Cornell School of Industrial and Labor Relations lab in Buffalo, who tracks the roles the federal government plays in the state in jobs and other aspects of local economies, including on Long Island.

The full extent of the potential economic and other disruptions to Long Island and New York State from even a partial federal shutdown — some operations are required to continue — remain clouded because the White House has yet to publicly reveal its contingency plans.

If a shutdown does occur next week, it would be the nation’s 15th since 1980 — with the longest lasting 34 days between December 2018 and January 2019. "That resulted in at least $3 billion in permanent economic damage nationally," said Bill Hoagland, senior vice president at the Washington-based Bipartisan Policy Center.

But this year, Hoagland said, "the lack of shutdown contingency plans from all federal agencies adds another layer of uncertainty and confusion." There remains little public notice about which services or programs would be halted or continued with reduced funding.

There is little direction yet from the White House on which federal workers will be furloughed, like National Park Service staff, or have to work without pay, like members of the military and Transportation Security Administration.

Federal workers

There are roughly 111,100 federal government jobs in New York State. More than 16,000 federal civil employees work on Long Island, according to Weaver’s research, which largely parallels that finding from the state Labor Department.

Weaver’s calculations go further, to show there are nearly 31,000 total federal workers who live on Long Island — if also counting those employed outside Nassau and Suffolk.

According to the Pentagon, there are more than 28,000 active-duty military troops stationed across New York State that could be impacted, along with other National Guard and reservists who are expected to show up for work during a shutdown, but unpaid, unless Congress passes special legislation to pay them.

"The economic consequences to communities are self-evident," Weaver says. "Purchasing power is removed from the places where federal workers live, the uncertainty tends to negatively affect private sector hiring and investment decisions, federal permits and federal loan programs become difficult to access or obtain, et cetera."

It’s not only that thousands of Long Island residents might face furlough and be unable to collect a paycheck. Vital programs like Social Security, Medicare and Medicaid, and food and nutrition programs for low-income families could face distribution issues even though the programs themselves would still be funded.

Last week, House Speaker Mike Johnson (R-La.) pushed a stopgap bill through passage to keep government operations funded into late November, which would allow more time to negotiate a fuller bill. But that bill and a competing temporary funding bill pushed by Senate Minority Leader Chuck Schumer both failed to get enough Senate votes to advance.

Senate Republicans are insisting on a "clean" bill that does not extend enhanced Affordable Care Act tax subsidies that are set to expire at the end of the year. But Democrats want those subsidies, or perhaps even a reversal of Trump-backed Medicaid cuts. Democrats also are seeking guarantees that Trump will not unilaterally later make cuts to agreed-upon spending.

Political debate

The blame-game volley between Trump with Schumer and House Minority Leader Hakeem Jeffries is being echoed by Long Island’s two Democratic and two Republican House members.

"The new Mamdani-Hochul Democratic Party has become so extreme, it's now blocking even Biden-era, status-quo funding — putting pay for our troops, support for air traffic controllers and operations at VA medical centers at risk," said Rep. Nick LaLota (R-Amityville), referring to New York City's front-running candidate for mayor.

Rep. Tom Suozzi (D-Glen Cove) warned that health insurance premiums will skyrocket on Long Island and nationally if they are not continued. "I think there’s been zero effort by the White House, and the Senate and House majorities, to negotiate, and this 'my way or the highway' attitude is not going to work," said Suozzi, co-sponsor of a bipartisan bill to extend the expanded ACA tax credits for a year.

Fellow Democrat Laura Gillen (D-Rockville Centre) noted she spoke to the White House Office of Legislative Affairs last week and also urged restoration of those tax credits in the bill and funding for law enforcement. "I hope my GOP colleagues decide not to shut down the government," Gillen said.

But Rep. Andrew Garbarino (R-Bayport) said the House did pass a bill last week to keep government open and that Schumer and Democrats voted instead to not allow that bill to advance in the Senate. He said "that risks leaving our troops, air traffic controllers and tens of thousands of federal employees on Long Island without pay," while also jeopardizing other essential programs American rely on.