U.S. Government Shutdown Looms: Essential Freight Operations to Continue, But Risks Remain

In the event of a U.S. government shutdown, essential freight operations like port and border inspections are expected to continue, but non-core services could be disrupted, causing delays and supply chain risks.

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Container transport (Photo: GoodLoading / Phaata)

In the event of a U.S. federal government shutdown, most essential freight operations are expected to be unaffected. The reason is that the agencies running these programs are often funded by separate mechanisms, such as the Highway Trust Fund, or their employees are considered "essential" and will continue to work.

This year, however, the Trump administration has threatened to use a shutdown as a reason to further cut federal personnel, creating uncertainty about the extent of the impact on government employees, including those at agencies under the U.S. Department of Transportation (DOT).

"DOT modal agencies are largely charged with safety functions, so anytime you cut from that you run the risk of decreasing safety," said Jameson Rice, a transportation attorney and partner at the law firm Holland & Knight. "It may not be felt immediately, but you will in the long term.”

Essential Operations to Continue

According to the latest contingency plans, short-term safety functions related to domestic freight will continue, including:

• Roadside inspections conducted by the Federal Motor Carrier Safety Administration (FMCSA).

• Rail accident investigations and safety recommendations by the Federal Railroad Administration (FRA).

• Vessel and port infrastructure security programs by the U.S. Maritime Administration (MARAD), which will continue using "carry forward balances".

• Inspection of imported goods at land borders and seaports by U.S. Customs and Border Protection (CBP), with approximately 93% of personnel retained.

• Vessel inspections and port security by the U.S. Coast Guard, with about 95% of personnel retained.

Risk of Delays from Other Agencies

While most CBP employees are considered essential, the same may not be true for other agencies that also have cargo inspection oversight, such as the Food and Drug Administration (FDA), the Environmental Protection Agency (EPA), the Department of Agriculture (USDA), and the Consumer Product Safety Commission (CPSC). Activities like CPSC's field investigations, product testing, and recalls could be halted, potentially causing supply chain disruptions.

“What sometimes is not considered essential are additional reviews of cargo shipments that might be required and are conducted by government agencies other than CBP,” shared Cindy Allen, an international trade consultant and former CBP executive director.

“So products subject to government oversight that may require additional review or testing might be impacted, which means potentially slowing freight flows,” she added.

Specific Impact on Regulatory Agencies

• Federal Maritime Commission (FMC): Will be heavily affected. According to its plan, all “that furthers the agency’s mission to ensure a competitive and reliable international ocean transportation supply system that supports the U.S. economy and protects the public from unfair and deceptive practices,” will be halted.

• Surface Transportation Board (STB): Activities related to case processing, legal filings, and most litigation will likely be suspended. This could affect the review schedule for the $85 billion merger between Union Pacific and Norfolk Southern.

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