Government Shutdown Could Deal Blow to City

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The federal government is bracing for a possible shutdown if Congress fails to reach a budget deal before Friday’s deadline.

New York City is home to more than 51,000 federal employees, and those deemed "non-essential" by their agencies would be furloughed without pay. Employees in positions essential to protecting life or property – such as air traffic controllers and law enforcement officers – would stay on.

The Bloomberg administration is looking at what happened during the last federal shutdown in 1995 to see other ways the city would be affected. A shutdown could deal a blow to the tourism industry: The Statue of Liberty, Grant’s Tomb and Ellis Island would be closed along with all other national parks, which city officials said could hurt tax revenue from sales and hotels.

Applications for passports would also be put on hold, as well as requests from foreigners for visas. Up to 30,000 visa applications went unprocessed each day during the 1995 shutdown, along with 200,000 passport applications nationwide.

Existing beneficiaries would continue to get payments from Social Security and Medicare, though new applications to those programs would likely be stalled. Officials said it’s also possible that doctors might not accept new Medicare patients.

And as tax day approaches, returns filed on paper would not be processed, leaving nearly a third of all tax returns in limbo.