Fiscal Harms of Federal Firing Act

This legislation directs the Comptroller General of the United States to conduct a comprehensive study on the fiscal and economic impacts of federal reductions in force (RIFs) on State and local governments. Congress finds that RIFs can displace workers, increase demand for State-administered services like unemployment insurance and Medicaid, and reduce local economic activity and tax revenues, noting the current lack of a comprehensive federal assessment. The study will analyze how these events affect government budgets, services, and regional economies, including changes in expenditures for social programs, impacts on tax revenues, and administrative challenges. The study's scope also considers variations based on RIF size and geographic concentration, incorporates historical case studies, and requires consultation with State and local officials, federal agencies, and experts. Within 18 months, a detailed report must be submitted to Congress, outlining findings, an analysis of RIF efficiency, and recommendations for supporting displaced individuals and affected State and local governments. This report will identify the most impacted governments, project budgetary effects, and propose policy options such as federal assistance or advance planning tools, ultimately being made publicly available.