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Wednesday, October 16, 2013

Federal Funding Gaps: A Brief Overview

Jessica Tollestrup
Analyst on Congress and the Legislative Process

The Antideficiency Act (31 U.S.C. 1341-1342, 1511-1519) generally bars the obligation of funds in the absence of appropriations. Exceptions are made under the act, including for activities involving “the safety of human life or the protection of property.” The interval during the fiscal year when appropriations for a particular project or activity are not enacted into law, either in the form of a regular appropriations act or a continuing resolution (CR), is referred to as a funding gap. Although funding gaps may occur at the start of the fiscal year, they also may occur any time a CR expires and another CR (or the regular appropriations bill) is not enacted immediately thereafter. Multiple funding gaps may occur within a fiscal year.

When a funding gap occurs, federal agencies are generally required to begin a shutdown of the affected projects and activities, which includes the prompt furlough of non-excepted personnel. The general practice of the federal government after the shutdown has ended has been to pay furloughed employees for time missed, even when no work was performed.

Although a shutdown may be the result of a funding gap, the two events should be distinguished. This is because a funding gap may result in a total shutdown of all affected projects or activities in some instances, but not others. For example, when funding gaps are of a short duration, agencies may not have enough time to complete a shutdown of affected projects and activities before funding is restored. In addition, the Office of Management and Budget has previously indicated that a shutdown of agency operations within the first day of the funding gap may be postponed if a resolution appears to be imminent.

Since FY1977, 18 funding gaps occurred, ranging in duration from one day to 21 full days. These funding gaps are listed in Table 1. About half of these funding gaps were brief (i.e., three days or less in duration). Of these, most occurred over a weekend, and disruptions to federal operations were minimal.

Almost all of the funding gaps occurred between FY1977 and FY1995. During this 19-fiscal-year period, 15 funding gaps occurred.

Two of the three most recent funding gaps occurred in FY1996, when President Bill Clinton and the Republican-controlled Congress engaged in difficult and protracted negotiations over budget policy, resulting in the veto of a continuing resolution and several regular appropriations acts for FY1996. Two funding gaps, amounting to five days and 21 days, ensued leading to the initial furlough of about 800,000 federal employees. The chronology of regular and continuing appropriations enacted during FY1996 is illustrated in Figure 1.

The most recent funding gap commenced at the beginning of FY2014, on October 1, 2013. This report will be updated after this funding gap is concluded.

Date of Report: October 2, 2013
Number of Pages: 10
Order Number: RS20348
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