The U.S. federal government shutdown on Wednesday, October 1, 2025, following Congress’ inability to pass funding bills, or appropriations, that keep federal agencies running for the next fiscal year, which begins October 1. If no agreement is reached by the end of September 30, a partial shutdown will begin the following day. Some essential employees still report to work, but others may be furloughed.
The U.S. Environmental Protection Agency (EPA) released a contingency plan in the case of a government shutdown. Key points from the September 29 document include:
- Out of roughly 15,000 employees, only about 1,700 remain active during a shutdown – most staff are furloughed.
- Employees kept on the job must fall into “excepted” (legally required, life/property protection, emergency response) or “exempted” (funded from carryover or special funds) categories.
EPA activities that will continue
Activities that the EPA will continue conducting in the event of a shutdown include:
- Protection of property and labs, including maintaining freezers, instruments, animals or ongoing experiments.
- Emergency response for environmental disasters, chemical and oils spills or Superfund sites posing imminent dangers to health and property.
- Some work funded by non0annual appropriations, including Superfund tax receipts and FIFRA/PRIA pesticide fees.
- Certain contracts and grants may proceed if funds were already obligated and don’t require furloughed EPA staff oversight.
- Contractors and grantees can continue to work only if funding was already obligated and work doesn’t require active EPA involvement.
- Payments can be made only if EPA staff deemed “excepted” can process them. Otherwise payments may be delayed.
EPA activities that will stop
Activities that the EPA will stop doing in the event of a government shutdown include:
- Issuance of new permits, guidance, rules or policy approval, including state requests such as NPDES permits, SIPs, TMDLs and water quality standards.
- Most research activities and publication of results.
- Civil enforcement inspections unless an imminent threat.
- New grants or interagency agreements except those tied to exempted funds or emergencies.
- Updates to EPA’s public-facing website except shutdown-related communications.
What it means for water utilities
The shutdown may result in regulatory delays that included new or pending permits, guidance documents and approvals. State-submitted programs like NPDES permits and TMDLS won’t be acted on during shutdowns.
Routine EPA inspections for drinking water systems, wastewater facilities or stormwater compliance are paused until a funding bill is passed. Enforcement only continues if it is tied to imminent threats to human health or property.
No new EPA grants for water infrastructure upgrades, stormwater resilience or research partnerships will be awarded during the shutdown. Utilities with existing obligated grants, like SRF or WIFIA projects already approved, may continue drawing down funds, but approvals and reimbursements requiring EPA involvement could face delays, according to an EPA document.
Emergency response
EPA’s emergency response functions will remain active during a government shutdown. If there’s a contamination event, spill or urgent water supply threat then EPA will respond. Superfund work continues only if lack of activity would pose an imminent threat to human health.
Business impacts
Engineering, consulting and construction firms working on EPA-funded water projects may see cash flow disruptions if invoices can’t be processed promptly. Technology vendors and contractors tied to EPA programs, like lab testing and research collaborations, may face suspended works orders unless they are already funded, according to an EPA document.
Bottom line for utilities
In the event of a government shutdown, day-to-day operations for water, wastewater and stormwater systems, which are largely state- or locally managed, will continue unaffected. However, federal oversight, funding approvals, new grants and non-emergency enforcement will slow or halt, creating potential backlogs once the shutdown ends.
Contractors and grantees should expect delays in payments and approvals, and utilities should anticipate regulatory uncertainty and slower EPA engagement until appropriations are restored.
