Federal Government Shutdown:

The State Legislator’s Guide to the 2025 Federal Budget

This is the new installment of a multi-part series, The State Legislator’s Guide to the 2025 Federal Budget, where we’re unpacking the full impact of the federal budget bill and equipping state legislators with the resources and strategies they need to lead at this critical moment.

On October 1st, the U.S. federal government shut down and put approximately 750,000 federal employees on unpaid leave for as-yet an unknown amount of time—on the heels of a $4.5 trillion tax cut for the wealthy at the expense of lifesaving programs like Medicaid and food assistance.

As the 2025 shutdown stretches into a fourth week, states and communities are feeling the direct impacts of the partisan gridlock in Washington.

What the Shutdown Means for…

What the Shutdown Means for States

• While many states are able to pull from rainy day funds to cover the initial gap in federal funding for vital programs, states have reported that they only have enough funds for a limited period of time, often a few weeks to a month. If the shutdown continues, critical programs that help people access food may have to be stopped.

• As the shutdown continues, states are staring down billions of dollars in lost economic revenue from furloughed federal employees to lost money in tax revenue, all with no guarantee of backpay once the shutdown ends.

• With the uncertainty of this shutdown, states are worried they will be left “holding the bag” when lifesaving programs shutter, compounding an already challenging situation after months of mass layoffs and budget cuts from the Trump administration.

What the Shutdown Means for Millions of Children and Families

• The U.S. Department of Agriculture (USDA) recently directed states to pause the issuance of Supplemental Nutrition Assistance Program (SNAP) benefits in November, and at least 25 states have already announced plans to pause payments next month. But the suffering is preventable: the administration already has the authority to draw from emergency contingency funds to protect nearly 42 million Americans from hunger.

• Without federal or state action, Women, Infants, and Children (WIC) programs across the country are at risk of turning away millions of children and expecting parents from nutrition and breastfeeding support. States can provide stopgap funding that would ensure that WIC programs can continue to operate through the shutdown.

What the Shutdown Means for Farmers, Rural Communities, and Tribal Communities

• Farmers can’t access loans, disaster relief, and other help already promised by the USDA. Payments for conservation programs and critical information about livestock and commodity prices have ceased.

• Public lands remain open, but visitor centers and services are closed. Prolonged closure will harm tourism and local economies that depend on visitor spending. Wildfire prevention work is suspended, increasing fire risk in vulnerable areas.

• Shutdowns have a severe impact on Tribal communities due to the federal government’s trust obligations for providing essential services, including healthcare, education, and public safety to Tribes. This destabilizes and delays vital services, creating widespread and compounding crises.

What the Shutdown Means for Our Economy

• Over 80% of federal workers live outside Washington, D.C., and the shutdown impacts every state and congressional district. Furloughs cause immediate financial strain due to missed paychecks and can lead to long-term economic hardship.

• Small Business Administration (SBA) loans are suspended, halting approximately $100 million in daily capital access for businesses that rely on these funds for growth and operations. Federal contracts are frozen, jeopardizing contractors and leading to potential layoffs across various industries.

How to Talk about the Shutdown 🗣️

• With the ongoing shutdown, this is a big opportunity to message about the issues that our community cares about. Prior to the shutdown, Rural Democracy Initiative reported that only a third of Americans had heard much about a possible shutdown, leaving a huge opportunity to shape viewpoints.

• When messaging on the shutdown, it is important to name our priorities, focus on building a federal budget that supports existing vital programs rather than starting from zero.

• Make clear what part of the opposition agenda you’re fighting to stop — don’t focus on process opposition (like recissions); instead, make the conversation about substantive priorities that are worth fighting for and that will support your state and community.

• When speaking about solutions and demands, they should be framed as a desired compromise to keep the government funded and our communities supported, not as just an opposition to Trump and conservatives.

• Shutdown Talking Points, Fair Share America

• Resource Federal Government Shutdown: What It Means for States and Programs, National Conference of State Legislatures

• Explainer: Why Government Shutdowns Keep Happening In The United States, Harvard Kennedy School

• How the Government Shutdown is Impacting Farmers, National Sustainable Agriculture Coalition

We want to hear from you! What questions do you have about the budget reconciliation bill? What strategies or ideas are you working on with colleagues and partners in your state that we should share with the SiX network?

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