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Federal Government Shutdown's Impact on Marketers

 

During week of Jan. 7, the House passed three appropriations bills that would fund the Department of Transportation (DOT), Department of Homeland Security (DHS), Department of Housing and Urban Development (HUD), Department of Agriculture (DOA), Food and Drug Administration (FDA), Department of Treasury (DOT) and the Internal Revenue Service (IRS) as part of an effort to end the ongoing government shutdown. Additionally, the House is set to vote on their fourth and final appropriations bill on Jan. 11 that would fund the Environmental Protection Agency (EPA) and Department of Interior (DOI). However, the votes are largely symbolic because Senate Majority Leader Mitch McConnell (R-KY) has said the Senate will not bring to the floor any bills that President Trump wouldn’t sign, and President Trump has said he would veto all four bills.

Due to disagreements on the appropriations bills and their lack of funding for the border wall, day 22 of the partial government shutdown left EPA without funding. The E-Verify electronic verification employment system’s website had been shut down, and USDA is working with states to issue February SNAP benefits earlier than usual. EPA has also announced it will begin “orderly shutdown procedures” of non-essential functions. There is no immediate resolution in sight and no other votes are expected today. House leadership have committed to giving 24 hours’ notice before calling for a vote.

The Department of Homeland Security (DHS) E-Verify electronic verification employment system’s website that verifies the information on a worker’s Form I-9 with Social Security Administration records, was shut down. For employers who use E-Verify, until the website is operational, simply go back to the rules for hiring documents that the majority of employers’ use, which includes employee Form I-9/Employment Eligibility Verification. According to DHS, the three-day rule for creating E-Verify cases has been suspended during the shutdown. There continues to be strong Administration support for the program. President Trump would like to mandate DHS’s E-Verify program nationwide, and his fiscal 2019 budget plan requested $23 million to expand the online program for all 50 states.

Meanwhile, on Jan. 8, Agriculture Secretary Sonny Perdue announced that in order to ensure that participants in the Supplemental Nutrition Assistance Program (SNAP) receive their benefits in February if the shutdown persists, USDA will work with states to issue February benefits earlier than usual.

Based on language in the recently-expired Continuing Resolution (CR), programs like SNAP can incur obligations for program operations within 30 days of the CR’s expiration. USDA will instruct states to request early issuance of SNAP benefits, and states will have until January 20th to request and implement the early issuance. SNAP retailers are urged to prepare for early transactions and to staff and stock stores appropriately.

If Democrats continue to refuse funding for a border wall, President Trump has said that he will likely use his presidential power to declare a national emergency. If this were to happen, the money for the wall would likely come from unused money in the Army Corps of Engineers budget, specifically from a disaster spending bill that Congress passed last year. If an emergency declaration is issued, House Democratic leadership have been discussing the possibility of suing the Trump Administration, although they may not have standing to sue. With no end in sight, it remains to be seen when the government will fully reopen.

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