Here’s What A Government Shutdown Would Do To Niceville.

Meet Manuel - His Small Business Will Suffer From a Government Shutdown. Here's What He Thinks:

Manuel Rojas started his restaurant Guaco Tacos, which opened just a few months ago on John Sims Parkway between Eglin Air Force Base and the Niceville/Valparaiso city limits. It’s a small building that used to hold a German restaurant and seats about 30 people at any time.

I’d recommend the burrito with medium salsa. Tasty corn tortillas and perfectly seasoned carne asada are a wonderful treat for lunch, especially when you only have an hour and need a quick lunch near the base.

The government shutdown, which could happen this Sunday, October 1, 2023, could mean some financial difficulty for Rojas – but he’s willing to sacrifice. He wants to see what he views as expansive, wasteful spending take deep cuts. The time is now, he says, for the government to rein spending, which seems to increase every year. “Of course, I’m concerned about the flow of business [into my restaurant],” Rojas says, “but I’m also concerned about the growing debt and polarization of Washington between the parties. On one hand, I’m concerned about my business, but I’m also concerned about the people in Washington making the right decision.”

Rojas believes the rate of deficit spending the federal government has taken up in recent years is the bureaucratic version of kicking the can down the road. He wants to see it stop – even if it hurts his business during a shutdown. “There is too much waste, corruption and greed in Washington,” Rojas says, “The federal government’s way too big.”

Should the shutdown affect his business, Rojas says he will do what he must in the interim to survive – including laying off workers, reducing food orders, and other cost-saving measures to make ends meet.

Who's Doing the 2023 Government Shutdown and How Does The Shutdown Affect Niceville?

Well, it depends on whom you ask.

In 1884 (I know, a long time ago), President Ulysses Grant signed a law that made it illegal for the federal government’s functionaries and bureaucrats to spend money not allocated to them by Congress. The law was called the Antideficiency Act.

So, the government bureaucrats have to freeze all work that does not have money allocated for the project whenever they run out of money: no email checking, no stapling, no weapon modernizing. No nothing.

On Sunday, the entire federal government will run out of money and cause what’s known as a government shutdown.

People on the left blame the shutdown on the Republican-controlled House of Representatives, who want to see cuts to spending

The first Government Shutdown as we know it today took place in 1980 at the end of the Carter administration, according to the Washington Post. The shutdown was minuscule by today’s standard. Only about 1,500 employees of the Federal Trade Commission were furloughed for a total of one day.

As the years went on – and Washington D.C. became more of a divided place to be, more and more shutdowns took place. The length of the shutdowns also increased. So far, the most protracted shutdown (which did not affect the Department of Defense and the Air Force) lasted 34 days and took place in 2018-2019.

If nothing changes, starting October 1, 2023, all federal employees and service personnel stop getting paid. Essential personnel would still work – but wouldn’t get paid until after Congress has come to a funding agreement, and the president signs the bill into law.

Who's Essential?

The Federal Office of Personnel Management defines essential personnel as “employees whose work is funded through annual appropriations but who are not furloughed because they are performing tasks that, by law, are allowed to continue during a lapse in appropriations. Such tasks may include emergency work involving the safety of human life or the protection of property or the performance of certain other types of “excepted work activities” as defined in DOJ and OMB guidance.”

While that is a decent definition – it doesn’t lay out who works and who doesn’t. The government is so used to the dysfunction of Congress that it has made an FAQ for who is and isn’t considered essential during government shutdowns. Something to be said for that, I suppose. Military members and some civilian employees will stay on the job – but 804,000 employees will be sent home on a high-stress vacation. The government does not pay any employees or service personnel. Still, everyone would get paid, in theory, on the ‘back end’ when the government passes a new appropriations law – thanks to a law passed after the 34-day shutdown in 2018-2019.

What Are The Effects Of The Potential 2023 Government Shutdown In Niceville, Florida?

Okaloosa County, where Niceville and Valparaiso, Florida are located, has a federal government addiction. Despite being one of the country’s most fiscally and socially conservative areas, more than 65 cents on every dollar of economic output in Okaloosa County is directly related to military missions on bases.

The economic dependency of our area on federal dollars means a shutdown, especially a prolonged one, could have lasting long-term effects on the area’s financial health.

Alan Wood, the Florida President of CCB Community Bank, says plenty of knock-on effects would last after a closure. “It could impact credit quality with the banks. If [the government shutdowns] people may not be able to make their mortgage payments, credit card debt will increase, too.” Those problems would lead to less spending power for consumers in Niceville – which would, in turn, hurt local businesses like Guaco Tacos.

It’s not just credit cards and mortgage payments. The shutdown could also affect homebuying, selling, and military moves, putting more stress on a housing and homebuying economy, feeling the pinch of higher interest rates.

Amanda Grandy serves on the Niceville Chamber of Commerce’s Military Affairs Committee and is a military spouse. She says frustration stacks up on frustration for people who rely on the military mission for their income. “We’ve definitely gone through it in the last couple of years. It’s just an inability, it seems, for Congress to pass an appropriations bill in order to fund [the government]. So, [military and essential personnel] will still work, but they won’t get paid until Congress comes up with a way forward.”

Grandy says the Congress, who gets paid during a shutdown, should suffer like everyone else if the government is shut down. “If they can’t fund our defense, why should they get paid?” Grandy asked rhetorically. “If they can’t get their ducks in a row, then they too should suffer the consequences of their poor planning.”

The frustration generated from the situation is not from the abstract for Grandy. In addition to being a military spouse who will see a hold on her husband’s income due to the shutdown, her clients who want to buy homes will also see delays. Programs like the National Flood Insurance Program (NFIP) through the Federal Emergency Management Program are essential in this part of Florida. Many closings can’t go forward without flood insurance. Grandy says that government-backed loans, like VA loans, also stop in their tracks while America waits for a budget resolution.

Would The Federal Government Shutdown Affect Local Government?

As for the local government itself, Okaloosa County Public Information Officer for the Board of County Commissioners Nick Tomecek says, “A federal government shutdown would not affect Okaloosa County greatly in the short term. Some federal grants and permits may be delayed, but County daily operations would continue as normal.” In response to a question about the airports from Mid Bay News, Tomecek said he believes that Okaloosa County Airports (VPS, Destin Executive, and Crestview-Bob Sikes) operation would also not be affected by a government shutdown

How Do We Avoid a Government Shutdown?

It’s pretty simple: either Congress passes, and the president signs a budget that would allow for the government’s funding, or Congress passes a continuing resolution to keep the status quo regarding our spending now. According to the Peter G. Peterson Foundation, continuing resolutions are not unheard of but require Congress’s consent to make them a reality.

The Peterson Foundation says continuing resolutions are bad for the country because “Lawmakers’ dependence on CRs to fund the government on a short-term basis undermines the budget process and introduces uncertainty to government agencies. By enacting full-year funding bills on time, lawmakers can focus on other important legislative duties and government agencies can operate more efficiently.”

But the Defense Department says a shutdown would be worse. “Also, people are not going to be able to travel to work on acquisition and sustainment projects, “so, it’s just extremely disruptive,” said Department of Defense undersecretary for acquisition and sustainment William LaPlante to DoD news, “The message it sends to the government workforce is, we’re sending people home, our engineers, our acquisition professionals, our sustainers our contracting officers, we’re just sending them home and saying you’re not essential.”