Managing Risk in Real Time During a Government Shutdown

Managing Risk in Real Time During a Government Shutdown

The US government officially shut down on October 1, 2025, after Congress failed to reach a funding agreement. As reported by Doug Benevento, Andrew Wheeler, and Troy Lyons of Holland & Hart, the Senate rejected a House-passed continuing resolution that would have extended funding through November 21. Instead, Senate Democrats advanced a shorter package through October 31 that restores Medicaid funding and permanently extends Affordable Care Act tax credits, leaving the two chambers deadlocked and federal agencies without appropriations.

With agency operations curtailed and staff unavailable, organizations dependent on federal approvals, permits, or funding are already feeling the strain. Benevento, Wheeler, and Lyons caution that the most damaging response is inaction. They recommend that organizations immediately assess which projects, contracts, or compliance obligations depend on federal engagement and take steps to mitigate any potential disruptions. Requests for critical information or documentation should be expedited through any available channels before further communication delays occur.

The authors also note that shutdown effects are not uniform. Some agencies and offices, such as those within the Environmental Protection Agency, may remain open temporarily using carryover or special funds, while others have halted operations entirely. The uncertainty extends to state governments, which often rely on federal funding and coordination for their operations.

For risk managers, the path forward centers on proactive assessment and communication. Identifying vulnerabilities, securing essential data, and clarifying timelines now can help mitigate the operational and financial fallout of the ongoing government shutdown.