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Shutdown Hitting Virginia Hardest, Survey Finds

The federal fiscal uncertainty stands to hit Virginia harder than any other state, a new survey finds.

The federal fiscal uncertainty stands to hit Virginia harder than any other state, a new survey finds.

The state tops the ranking, followed by Alaska, Alabama, Washington and Maine, according to Wallet Hub, a financial website.

The Wallet Hub survey took into account a series of factors, including the number of federal workers per capita and the amount of federal contract money per capita, both of which helped push Virginia to the top.

It also considered areas in which people either have lost — or could potentially lose — federal funding, including students, small business owners, senior citizens and veterans.

Stephen Fuller, director of the Center for Regional Analysis at George Mason University, said he's not surprised to hear that Virginia topped the list.

Fuller calculates that in the Washington metro area, the shutdown has meant a roughly $200 million hit each work day in loss of federal wages, loss of federal contractor wages and the effects of those lost wages on the economy.

Fuller's analysis doesn't include other impacts, including tourism.

“Some of these losses are permanent,” Fuller said, stressing that much depends on how long the shutdown lasts.

In Fuller's survey the Washington metro area covers Washington itself, five counties in Maryland and eight counties and six cities in Northern Virginia stretching down to the Fredericksburg area.

Gov. Bob McDonnell's chief of staff, Martin Kent, has said that 300 full- and part-time state employees had been affected in some way by the partial federal government shutdown and of those, about 200 are either part-time employees who will be furloughed or are full-time employees who will switch to part-time status.

An update on the state situation was not available Monday, which was a holiday and the governor's office was closed.

The uncertainty comes at an inopportune time for Virginia as it enters its budget and revenue forecasting process.

McDonnell and state lawmakers met this month with bond rating firms in New York City and on that same day, Moody's Investors Service deemed the federal shutdown a “credit negative” for the local governments close to the D.C. metro area.

In the event of an extended shutdown, Northern Virginia localities could see declining sales tax revenues and potentially less aid from the state if it's trying to manage its own financial strain, it reported.

The fall revenue forecasting process has also started, Secretary of Finance Richard D. “Ric” Brown noted in his September revenue report.

The Joint Advisory Board of Economists will meet Wednesday to “assess recent economic developments and the outlook for the current and next biennia,” and the Governor's Advisory Council on Revenue Estimates will convene in November to evaluate JABE's recommendations and revenue collections through October, he said.


Copyright 2013 – Richmond Times-Dispatch, Va.