Federal government shutdown: Week 2

The federal government shutdown is entering its second week, and there are minimal signs of a resolution to the stand-off. We wanted to provide an update on the impasse.  Also, below you will find an overview of the impacts of the shutdown being felt by afterschool programs and the children, youth, and parents served by programs.

Few signs of the government reopening

Since the federal government shut down on October 1, 2025, due to failure to pass a continuing resolution that would extend funding into FY 2026, there have been no formal negotiations between the House and Senate Republican and Democratic leadership. Instead both sides appear to be dug in: Republicans insisting that 60 votes for the “clean" continuing resolution (CR) passed by the House on September 19 is the only path forward to reopening the government; while Democrats continue to support a CR that would extend enhanced Affordable Healthcare Act subsidies, roll back Medicaid cuts, and limits the authority of the Administration to withhold already appropriated funds.      

As of Tuesday, October 7, the Senate has voted five times on both the Republican House-passed Continuing Resolution (CR) and the Democrat CR. All of these attempts have failed to garner the 60 votes needed to pass. For the past few votes, two Democrats and one Independent have joined all but one Republican in voting for the House-passed CR that would fund the government through Nov 21. Only Democrats have voted for their alternate CR that would fund the government through October 31. House leadership cancelled its planned schedule for this week, keeping the pressure on the Senate to pass the House bill as-is. The Senate is in session this week, but is scheduled to be out next week.

Leadership of the two parties are not meeting nor negotiating but a small group of bipartisan senators are working towards a way to resolve the budget impasse. President Trump indicated on October 6 that he would be open to negotiating a compromise on extending healthcare subsidies, which could lead to a resolution. Additional pressure on finding a resolution is expected next week as military members and other federal employees will miss their next paycheck on October 15.

Impacts starting to mount

We continue to learn more about how the shutdown is impacting schools, communities and afterschool programs:

• The Department of Education posted its Contingency Plan in late September, calling for a furlough of 1485 of 1700 total employees. Impact Aid appears to be only K-12 education program currently affected – with schools that count on that funding not able to access it while the government is shutdown.  Federal education funding for the 21st Century Community Learning Center program, Title I Part A, Title IV Part A, Career and Technical Education, all continue to be accessible to states and programs. One exception to the federal funds flowing is Pennsylvania where the state budget impasse has resulted in all federal funds frozen including 21st CCLC  – with afterschool programs unable to be reimbursed while no state budget is in place.  
   
• The Department of Health and Human Services has about 41% of its staff furloughed; however, Child Care Development Funds are accessible to states. Head Start program funding, however, remains frozen for the length of the shutdown.
   
• The Department of Agriculture (USDA) has indicated that it has funding in place to provide reimbursement for school meals, including afterschool meals, until the end of October; however, a prolonged shutdown could cause delays. About 49% of USDA staff is furloughed.
   
• The Department of Defense, which operates schools worldwide on military bases, has kept schools open, however afterschool programs, extracurricular activities and sports have all been temporarily suspended due to the shutdown.
   
• AmeriCorps members are still working and will be paid once government reopens, depending on cost share/payment model of programs.

One important caveat to this: the Administration has made clear it will lay off federal employees permanently, not just furlough them, if the shutdown continues. It is possible some of those layoffs could come as early as this week. An Office of Management and Budget memo from late Sept. outlines plans to permanently lay off staff. Layoffs of federal employees could have long-lasting impacts. Further complicating matters is a recent report from the White House that challenges a 2019 law guaranteeing federal workers receive backpay in the event of a government shutdown.

What happens when the government reopens?

When a budget deal is eventually reached and government reopens, the House and Senate still need to agree on top line numbers for the FY 2026 spending bills to complete the FY26 budget– that is looking increasingly difficult due to policy disagreements over healthcare, withholding of appropriated funds, and rescissions. It remains difficult to predict when final FY 2026 spending bills will get enacted and it is still possible a full year continuing resolution for FY 2026 will be needed, as occurred for FY 2025. The weeks ahead remain critical to weigh in with Congress about the importance of federal afterschool funding, which provides support for local school and community-based organizations that serve almost 1.4 million children.