Government Shutdown: What Contractors Need to Know
The federal government has officially shut down after Congress was unable to reach an agreement on federal spending. While many government operations are paused, not all construction projects will be affected in the same way.
What This Means for Contractors
According to the Associated General Contractors of America (AGC), the impact depends largely on the type of contract and funding source:
Federal-Aid Contractors
Projects funded by the Infrastructure Investment and Jobs Act (IIJA) — including highway, transit, and airport programs — will continue as planned.
These programs receive advance appropriations.
Funding is not directly tied to annual congressional approval.
Contractors should expect minimal to no disruption in operations.
Direct Federal Contractors
Those working directly with federal agencies such as the U.S. Army Corps of Engineers or the General Services Administration (GSA) may experience temporary suspensions.
Fixed-price contracts already awarded will generally continue as planned.
Cost-type, time and materials, and IDIQ/MATOC/MACC contracts could be paused or delayed until funding resumes.
New awards and task orders are likely to be put on hold until after the shutdown ends.
If the shutdown extends beyond a few weeks, AGC warns that additional projects and funding streams could begin to feel the effects, especially as agencies run out of carryover funds or delay approvals.
AGC’s Ongoing Guidance
AGC is actively monitoring developments and providing resources to help contractors navigate the potential impacts.
Read the full report: What Contractors Need to Know During a Shutdown (PDF)
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