A cash flow problem that may leave the city of New Orleans without enough money to pay its bills for the rest of the year is due in part to the fact that it has not received an expected $120 million advance from the Federal Emergency Management Agency.

It’s a reality that city officials blame not just on the ongoing federal government shutdown but also on policies the Trump administration has leveled against “sanctuary cities” that don’t cooperate with federal government’s hard-line immigration policies.

The city may now be at risk of not having enough funding to cover payroll for thousands of its employees.

The news comes as the city stares down a $160 million budget deficit that will require it to spend down its reserve fund as well as adopt new revenue-generating measures — all while it prepares and passes its budget for next year.

That $120 million in FEMA funds was supposed to come as part of the $2 billion Joint Infrastructure Recovery Request program, wherein the city and the Sewerage & Water Board pooled federal post-Katrina recovery funding to work together to fix long-neglected roads and drainage infrastructure. The city, which was slow to spend the money at first, has since signed extensions with FEMA, so that it can continue to upgrade infrastructure, especially roadwork.

According to interim Chief Administrative Officer Joe Threat, the city put in a request in August to again extend its agreement with FEMA, so it could continue to receive regular advances on that funding. While that request got approved by regional administrators, it has been sitting on national administrators’ desk without movement, Threat said. Now, with the federal government going into its third week of a shutdown, there appears to be little movement on paying the $120 million expected by city officials.

“In the change of the administration and the way FEMA looks now and the whole federal government, there was an initiative to claw back grants, cancel grants and close out the Katrina disaster,” Threat said at the Wednesday council hearing.

But the shutdown wasn’t the only factor throwing this program into question, city Director of Intergovernmental Affairs Arthur Walton said. It was also the fact that the Trump sees New Orleans as a “sanctuary city,” meaning it limits its cooperation with federal immigration enforcement.

FEMA did not immediately respond to a request for comment.