How do continuing resolutions affect federal agencies?

1. How CRs Force Agencies to Operate with One Hand Tied Behind Their Back

Continuing resolutions generally fund agencies at prior-year levels or an annualized rate, which locks agencies into past budget assumptions and prevents normal reallocation to emerging priorities. That funding formula limits the ability to launch new initiatives and adjust for inflation or changing needs, producing a concrete planning problem: program managers cannot reliably schedule multi-year grants or start new procurement because the legal authority for expanded activity is absent or ambiguous ^{[1] [3]}. Agencies face specific operational limits such as hiring freezes, curtailed travel, and delayed contract awards, which ripple into slowed program delivery and reduced service responsiveness. The net effect is administrative rigidity that reduces programmatic agility even while avoiding a shutdown’s abrupt stop to services ^{[4] [5]}.

2. Administrative Costs and Inefficiencies That Don’t Show Up in Headlines

CRs create predictable but often invisible administrative burdens: extra reporting, repeated re-planning, and the time agencies spend tracking funding authorities and anomalies. These burdens translate into real staff hours diverted from substantive work to compliance and contingency planning, increasing overhead and eroding productivity. The Government Accountability Office and related analyses document that agencies repeatedly adopt mitigation strategies—like prioritizing certain activities or using flexibility in existing statutes—but those adaptations themselves require managerial time and sometimes expensive stopgap measures. The cumulative administrative cost can be considerable, particularly for agencies with large grant portfolios or seasonal operations where timing matters ^{[2] [5]}.

3. Concrete Program Disruptions: Examples Where CRs Bite

Real-world examples show how CRs can delay or disrupt essential services: education grant awards to institutions, energy assistance seasons, rental-assistance payments, and statistical survey schedules have been postponed or complicated by temporary funding rules. These disruptions reflect the structural feature of most CRs: they prohibit or limit new starts while carrying forward old funding levels, which means agencies either delay actions or execute them under risk of later funding reconciliation problems. While CRs avert the immediate harm of a shutdown by maintaining basic funding flows, they produce staggered impacts that can impair program effectiveness, particularly for time-sensitive operations ^{[1] [4]}.

4. Agencies’ Coping Playbook: Mitigate, Prioritize, and Patch

Agencies employ a consistent set of mitigation strategies under CRs: delaying awards, shifting personnel to high-priority tasks, exploiting statutory flexibilities, and using carryover balances where available. These tactics allow continued operation with minimized public-facing disruptions, but they do not erase the strategic harms of delayed investment, staff attrition, or the inability to respond to new challenges. Oversight reports emphasize that while mitigation can blunt the immediate impact, it imposes opportunity costs—missed policy windows, reduced morale, and decreased leverage in procurement or hiring markets—especially when CRs are long or cover an entire fiscal year ^{[2] [5]}.

5. Trade-offs: Better Than a Shutdown, Worse Than Full Appropriations

CRs are a political and operational compromise: they provide short-term continuity and prevent the abrupt service interruptions of a shutdown, which is why Congress and agencies often prefer them. The trade-off is reduced fiscal and programmatic flexibility, potential waste from annualized spending that conflicts with final appropriations, and the possibility of austerity by default if CRs persist for months. Different stakeholders frame CRs differently: proponents stress continuity and stability, while critics highlight the stagnation of policy priorities and the cumulative harms to agency effectiveness. Both characterizations are supported by operational evidence showing partial continuity coupled with concrete disruptions and costs ^{[1] [3]}.

6. What the Record Shows and What It Leaves Unsaid

Empirical examinations converge on the view that CRs are operationally disruptive in measurable ways: they constrain new activity, complicate planning, and add administrative burdens, while still preventing the far worse impacts of a shutdown. That consensus leaves open important questions about scale and distribution of harms—which agencies or programs suffer most, and how repeated CRs over years change institutional capacity—areas where existing summaries identify anecdotes and patterns but less systematic long-term measurement. Oversight documents and agency reports provide consistent, recent evidence about mechanisms and consequences, and they underline that mitigation reduces but does not eliminate the policy and managerial costs of operating under continuing resolutions ^{[1] [2]}.