PORTLAND — Because the federal government intersects with Maine’s private and public sector in myriad ways, trying to understand how the shutdown, which began Tuesday, will affect Maine’s wider economy is difficult at this early stage, according to Tim Woodcock, an attorney at Eaton Peabody in Bangor who focuses on public policy and litigation.

The major factor that will determine the shutdown’s effect will be how long it lasts, Woodcock said.

“If you were to try to generalize (the effect), the easiest thing to do would be to say, ‘Well, if it’s a real brief shutdown, the impact will not be great and not even fully noticeable, except by inconvenient experiences,” Woodcock, who’s also a former Bangor mayor, told the Bangor Daily News on Tuesday. “But the implications for any kind of significant prolonged shutdown would be profound.”

If the shutdown drags on, the lapse in federal funding has the potential to seriously harm the state’s economy by delaying payments to contractors, impeding the Small Business Administration’s ability to provide capital to small businesses and stalling research and development funds to the university system.

“There are so many variables, and different [federal] agencies handle this differently,” Melody Weeks, director of the Maine Procurement Technical Assistance Center, which assists Maine businesses to secure government contractors, told the BDN on Tuesday.”It’s very complicated, very confusing. The financial impact could be huge, but there’s not an answer at this time.”

The federal government is the largest buyer of goods in the world. It has contracts with businesses in Maine that do just about everything, Weeks said, from providing janitorial services to manufacturing apparel. During the federal government’s 2011 fiscal year, $5.1 billion in federal contracts flowed to Maine contractors (the vast majority of which, about $4.6 billion, was awarded by the U.S. Navy), according to the Center for Effective Government.

In general, if a business received a contract prior to Oct. 1, 2013, it should be fine if the shutdown doesn’t last too long, Weeks said. However, if the federal shutdown drags on, those payments may be delayed as there’s no one to service them. In that case, it’s the companies low on cash that could have problems, she said.

Scott Bourget, chief financial officer for Maine Machine Products, a precision manufacturer that acts as a subcontractor on government jobs mostly in the defense industry, said the shutdown isn’t expected to have an effect on the company, which employs 120 in South Paris.

“There’s no telling what can happen, but at this point we have no reason to believe that it will affect us one way or another,” Bourget told the BDN on Tuesday.

Larger federal contractors such as Bath Iron Works, a subsidiary of General Dynamics Corp., will not be affected. BIW is working on contracts approved and funded during previous fiscal years, and is not expected to feel any immediate pain from the shutdown, shipyard spokesman Jim DeMartini told the Bangor Daily News on Tuesday morning. BIW builds destroyers for the U.S. Navy and employs approximately 5,700 people.

DeMartini said the shipyard is planning to carry on its construction of warships as usual. A call to the spokesman for General Dynamics’ facility in Saco was not returned Tuesday morning.

The most obvious effect of the shutdown are the furlough of federal government employees in Maine. The total number of furloughed employees in the state is unclear, because each agency is different. Nationally, 800,000 are expected to be told to stay home from work, according to the Washington Post.

For example, it’s believed the 200 federal civilian employees who work in Bath at the federal Supervisor of Shipbuilding, Conversion and Repair office, which manages the design and construction of the destroyers built at Bath Iron Works, have been furloughed. Kristin Mason, a spokeswoman for the office, could not be reached on Tuesday. Her message said employees, including herself, had been furloughed “due to a lapse of federal funding.”

However, in Limestone, the shutdown will have no immediate effect on the federal Defense Finance and Accounting Service office, which has more than 540 employees.

“At the moment all employees are reporting to work and will continue to work,” according to Thomas Larock, deputy director of corporate communications for DFAS. “At the moment, all operations are normal.”

DFAS does not rely on federally appropriated funds, Larock said Tuesday morning. Rather, he said DFAS is paid on a contract basis by the military, which gives the service a working capital fund.

“We have cash reserves that will allow us to operate for at least the immediate future,” he said. “But depending on how long [the shutdown] continues we may have to look at those cash reserves and make some adjustments.”

With more than 540 employees at the Limestone facility, which is at the Loring Commerce Center, Larock said those cash reserves should keep things operating normally for about a week.

“At this stage it is too early to give a predictor date, but if this were to drag on for a week or so at that point we would need to sit down and look at things on a day-by-day basis,” he said.

When it comes to small-business lending, Yellow Breen, chief strategic officer at Bangor Savings Bank, said the shutdown will have little immediate effect. The bank was able on Monday to expedite five SBA-backed loans that had all their paperwork in order and was able to get them approved. About half a dozen more will remain in limbo until the shutdown ends, he said.

Given that it takes several weeks for a potential SBA-backed loan to work its way through the system, it would require a shutdown lasting weeks until a real impact is felt by the bank or its customers, Breen said.

If that happens, Breen said the bank would look at alternatives, such as the Finance Authority of Maine, to help back riskier business loans.

Within education, the length of the shutdown will also determine its effect on the University of Maine System.

“If the shutdown is short-term, we should see very little impact on the University of Maine System and it will be business as usual on our campuses. If the shutdown lasts for weeks, however, we may see some impact on student financial aid, or federal grants and contracts related to research and other activities,” Peggy Leonard, a spokeswoman for the system, wrote in an email. “As a result, we are keeping a close eye on what’s going on in Washington.”

BDN Reporters Seth Koenig and Julia Bayly contributed to this report.

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