Agencies brace for possibility of lengthy standoff

A short shutdown of federal government services and operations likely will have little economic impact on the state of New Mexico, but agencies on Friday were preparing for the possibility of a budget standoff that could last more than a few days.

“A few days is not a big deal,” said Jim Peach an economics professor at New Mexico State University. “Several weeks would be a really big deal for New Mexico and other states.”

He said the impact also will depend on how many of the 21,000-plus federal workers in the state are exempt from furloughs because they are involved in defense or national security work.

The last government shutdown, in October 2013, lasted 16 days. It was the longest on record, with 850,000 government workers sent home and 6.6 million lost workdays.

All national parks and monuments were closed,

which slowed tourism in the state. Although Los Alamos National Laboratory remained open, uncertainty over whether paychecks would continue affected employee spending.

“The dollars and cents of federal spending matter,” Mark Zandi, chief economist for Moody’s Analytics, told CNN Money, “but [the problem] was really the impact on confidence due to the uncertainty,”

Moody’s Analytics said the 2013 shutdown cost the economy an estimated $20 billion, shaving 0.3 percent from the nation’s economic activity.

The 2013 shutdown was especially costly in New Mexico because the state was teetering on the edge of a recession.

The federal government today is still by far the largest employer in New Mexico. The state has the fifth highest concentration of federal employees in the United States.

But many operations in the state are related to national security and defense, and a large number of those at Kirtland Air Force Base, Cannon Air Force Base and White Sands Missile Range, as well as Los Alamos National Laboratory and Sandia National Laboratories, would likely be exempt from a shutdown and expected to work.

And this time around, the state is on firmer financial footing with a stronger energy sector.

The U.S. Energy Department receives direct government spending, but the two national laboratories are managed for the department under a contract with private companies. The dollars for those agreements are often dished out in installments and a short shutdown would not necessarily furlough workers.

An email sent to Energy workers Friday stated just that: “The Administration does not believe it is necessary for a lapse in funding to occur, and looks forward to working with the Congress to finalize appropriations for this year. All DOE Federal employees are expected to report to work on your next scheduled work day and subsequent work days unless you have previously approved leave or are given formal notice by your management not to report to work. Similarly, contractors should continue to execute on contracts unless and until otherwise notified.”

The Interior Department has said it will strive to keep as many national parks and monuments open as possible, even if that means closing backcountry areas and culturally sensitive sites or campgrounds that require staffing.

The U.S. Forest Service has 28,000 employees nationwide and more than 1,500 permanent employees in New Mexico.

“Many Forest Service activities would be shut down or significantly reduced and many employees will be furloughed pending reinstatement of funding by Congress,” said spokeswoman Babete Anderson. “However, certain Forest Service activities would continue because they are related to law enforcement and the protection of life and property, including fires.”

A New Mexico National Guard spokesman said its volunteers will remain ready for emergencies.

“Activities will continue notwithstanding the absence of available appropriations if they are determined to be required to maintain national security or to provide protection of life and property,” said spokesman Joe Vigil. “Military personnel and ‘excepted’ civilian personnel continuing to work will accrue pay, but may not receive pay until enactment of appropriation or a continuing resolution.”

Staff writers Rebecca Moss and Robert Nott contributed to this report.