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key takeaway

Federal government shutdowns can significantly disrupt California’s essential safety net programs, potentially affecting millions of residents and underscoring the importance of ongoing support for these vital services.

Access to health care, affordable food, safe housing, and a safety net to turn to during unexpected challenges is essential for everyone. Safety net programs provide critical support to more than 1 in 3 Californians every year. Without these important public supports, California’s poverty rate would be much higher.

During a federal government shutdown, safety net programs that receive federal funding can be affected, potentially causing disruptions to the lives of millions of Californians. This Q&A provides an overview of California’s safety net programs and how they can be impacted during a federal government shutdown.

What Are Safety Net Programs and How Many Californians Do They Support?

Safety net programs provide financial assistance, health care, and other essential services to millions of Californians. These programs help people with low-incomes or people experiencing unexpected challenges — such as losing a job — receive the care and support they need to get by. California safety net programs are supported by state and federal funding.

Why Does a Federal Government Shutdown Happen?

A federal government shutdown occurs when the United States Congress fails to pass annual or temporary spending bills before the start of the new federal fiscal year, which begins on October 1st. Federal policymakers can enact temporary spending bills, or continuing resolutions, that allow the government to continue operating while policymakers reach an agreement on the federal budget. Shutdowns typically happen due to political disputes, disagreements over spending priorities, and legislative gridlock.

How Can a Federal Government Shutdown Impact Safety Net Programs?

The duration of a federal government shutdown would determine the impact on safety net programs. Prolonged shutdowns can have devastating consequences for Californians who receive health, food, and housing assistance. If a shutdown persists, California policymakers should allocate additional state funds to sustain critical programs and services.

In contrast, shorter federal government shutdowns, lasting only a few days, generally cause less disruptions. Californians can still access various health and safety net supports during these brief closures. For instance, Californians who rely on Medi-Cal can maintain access to health care services, as Medi-Cal providers could continue to receive reimbursement in the short term. This is partly due to advance funding provisions within the Medicaid program, which can be secured in prior federal budgets.

What Are the Potential Impacts of a Brief Government Shutdown?

Community health centers, including Federally Qualified Health Centers, are more susceptible to adverse impacts. Even a brief shutdown would affect community health centers’ ability to provide services and meet operating expenses because they rely on funding from federal grants.

Short shutdowns can also have repercussions for other safety net programs. Some government employees would be furloughed during shutdowns, which means programs could experience staffing shortages. Staffing shortages could negatively impact Californians. For example, even though Californians could continue to receive rental assistance through HUD (Housing and Urban Development), nearly all of HUD’s fair housing activities would cease due to a reduced staffing.

What’s At Stake?

A prolonged federal shutdown could have disastrous effects on our state and disrupt the lives of millions of Californians, especially communities of color. Past and current racist wage and employment policies concentrate people of color into under-valued occupations with lower wages and minimal benefits. As a result, Black, Latinx, and other Californians of color are more likely to have trouble affording basic needs — like housing, groceries, and diapers — and are also more likely to qualify for safety net programs. If a prolonged shutdown leads to a suspension or reduction of critical programs and services, it would disrupt the lives of millions of Californians and exacerbate economic inequality. This underscores the need to ensure that every Californian, regardless of their race, age, zip code, or gender, can thrive and share in the state's prosperity.

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