With Minnesota's government shutdown now in its sixth day, credit unions have begun to see some slight logjams on loan paper processed by state agencies, but say the overall impact has been minimal so far.

However, CUs said they have been preparing for a possible surge of loan requests from furloughed workers, perhaps next week.

For one, the $833 million Hiway FCU of St. Paul said it had approved 100 “Skip a Payment” requests so far since the budget impasse began July 1.

Hiway, which has a large percentage of state employees as members, is also planning to roll out next week a loan relief program to the laid off workers though details of the program “we're not ready to outline at this point.”

Lien change paperwork on loans has been submitted routinely to the state but of course, “we aren't getting replies,” noted Jeff Schwalen, president/CEO of Hiway.

Under the shutdown, the Secretary of State's office was deemed a vital service by court orders and “therefore, credit unions can still use their services,” said a spokeswoman for the Minnesota Credit Union Network. CUs, she said, “are still able to conduct vehicle loans and can process them as long as they can obtain the titles but the titles are not being officially transferred until state starts back up.” Loan traffic overall has been slow, said Schwalen, as members apparently remain cautious “looking to see what happens.”

The state's Democratic governor, Mark Dayton and Republican legislative leaders, were to meet again today after a session Tuesday which failed to break the deadlock on a two-year budget deal that would close a $5 billion deficit before the new fiscal year started July 1.

The current shutdown is much broader in scope than a nine-day impasse in 2005 under then governor and now Republican presidential candidate Tim Pawlenty.