Maple Lawn, MD | March 16, 2011- If you are a government contractor, March 18, 2011 is a date that should be marked in bold on your calendar. That is the date after which, unless Congress comes to agreement on the budget, the federal government will run out of money and will shut down. (Lest you think it cannot happen, it did in 1995 and lasted over three weeks.) With a federal government much more dependent on government contractors than it was sixteen years ago, the ramifications this time will likely be more broad and damaging. While repercussions will vary from contractor to contractor, indeed from contract to contract, it can be said with some certainty that a government shutdown will adversely affect many government contractors. And the effects can be for some, catastrophic. For those performing non-mission essential services (e.g., those not involving safety, security and legally mandated activities not subject to annual appropriations), the shutdown could affect performance on contracts (e.g., work stoppage, access to government personal and facilities), cash flow (payment on invoices), employee retention, potential business (RFPs), to name just a few. While there is still time for the shutdown to be averted, given the potentially widespread and deep consequences, government contractors of all sizes would be wise to have a contingency plan in place. (Even if the shutdown is averted, such planning makes sense, as the potential for this circumstance arises every year, with the finalizing of the federal budget.) Planning for contingencies should be an essential part of the planning of any organization doing business with the federal government (or any other customer). As with any “life event” (i.e., those events that are inevitable and over which we exert little, if any, control), prudence dictates planning for contingencies, in this case, the potential shutdown of the federal government, of whatever duration. A truism of life and business: In all planning, the timing is paramount. Actions taken before the need arises are almost always better (i.e., more options; more cost-effective) than solutions put in place after the fact.  There is no one size fits all solution.


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