“It is now the time of crisis,” said Lee Saunders, president of the American Federation of State, County and Municipal Employees, in an interview in which he predicted further layoffs in the public sector. “Basic services that citizens of this country depend on are being cut and cut, and people in their communities are being hurt.”
Congress allocated $ 150 billion to state and local governments under the CARES Act in March, but limited the use of that money at coronavirus-related costs. Majority Leader of the Senate Mitch McConnell turned down requests for an additional $ 500 billion in assistance, saying money is better spent elsewhere.
With local economies ravaged by the pandemic, officials “are very opportunistic to find ways to fill that void and provide loans to help people and businesses stay successful during the pandemic,” said Dave Wallack, director the Democratic Treasurers Association said in an interview. “Every state in the country is hungry for federal funding, and there is no substitute for the federal government to step in.”
Here’s a look at how six states and one city – Washington, DC – are using their own scarce resources to boost the economy, protect the vulnerable, and keep money flowing to their own authorities.
Colorado state legislature convened a special session the first week of December to forward a series of bills that will transfer state money to local restaurants and pantries.
The $ 342 million package leads $ 5 million for the government’s Food Pantry Assistance Grant program, and $ 60 million for rental and mortgage assistance. $ 50 million in restaurant tax breaks$ 45 million for childcare workers, $ 20 million for broadband Internet access for educators and students, and $ 5 million for resident utility payments and $ 57 million for the creation of a program to support small and minority businessesalong with arts organizations.
The federal paycheck protection program “was a lot of money, but it really went to the bigger corporations in the state,” Treasurer Dave Young, an elected Democrat, said in an interview. “And the smaller … non-banking companies were taken out of the mainstream.”
To fill these loopholes, the state launched a “very small” grant program, the Colorado Energized Gap Program, to channel CARES Act funds to “the smallest of our small businesses,” Young said. “But then along the way we also thought about those companies that were successful a year or two or three before the pandemic but were now struggling and, if they got the kind of support they needed, would have a lifeline and can survive. “
“We wanted to offer these companies that we know are profitable some working capital that they can use to get their businesses back on track,” said Young.
Wisconsin was state legislature the least active of all full-time legislators.
So Sarah Godlewski, the state’s elected treasurer, took matters into her own hands.
“These are unprecedented times,” said the Democrat Godlewski in an interview. “And so we have to take unprecedented measures.”
Godlewski began making calls across the state to see what she could do as state treasurer. Her first call, she said, was to a librarian in northern Wisconsin.
She said, ‘Look, Sarah, we want to prepare our children for success. However, we don’t have all the tools and resources to meet this distance learning need, ”recalls Godlewski.
Godlewski’s thoughts went to the state’s Common School Fund: When Wisconsin became a state, it acquired public land which it later sold. The proceeds from the sale then went into the fund, which is administered by the Board of Commissioners of Public Lands and which is paid out to the state’s public schools each year.
It was time for a big retreat on a rainy day, argued Godlewski.
The distribution of $ 5.3 million was announced in April and the schools received the money a few weeks later. This was on top of the $ 38.2 million already earmarked for distribution in 2020.
The money added a spike in spending to the state’s dwindling economy – and provided the learning tools needed to fill the gap in distance learning.
“Teachers could buy these hotspots, buy these Chromebooks, to help children who were really disadvantaged because their parents didn’t have the resources to set them up,” Godlewski said.
Another step Godlewski took to stimulate the economy was working with county and town treasurers to identify individuals who were about to become criminals for the first time on their property taxes. She helped pilot a program – the COVID Property Tax Foreclosure Prevention Program – that contacted homeowners who were underemployed or unemployed “through no fault” to help them meet the payment rather than enter a cycle of higher interest rates getting involved.
In addition, the state has launched a program called local governments, many of which are located in rural communities, who were not eligible for CARES funding and were unable to obtain loans to fund projects when revenues fell and expenses increased.
“I have to get creative because that’s my only option in this crisis,” she said.
Last month, New Mexico officials passed a bipartisan relief bill that issues a one-time check for $ 1,200 to every unemployed worker and provides $ 100 million in small business grants.
Democratic Governor Michelle Lujan Grisham signed the bill the day after both houses of the legislature overwhelmingly passed the measure.
“I am grateful to the legislature, both chambers and both parties, for their work,” said Lujan Grisham in a statement following the signing of the measure. “New Mexico will always rise even if the federal government doesn’t.”
More than 100,000 New Mexicans are expected to receive $ 1,200, the governor’s office said.
The pandemic aid package also included other helplike $ 15 million for shelter and other aid to the homeless; $ 5 million for food bank emergency services; $ 5 million in direct assistance to low-income residents who have not received an “economic impact payment” from the federal government; and $ 10 million for vaccine tracking, testing and distribution.
District of Columbia
The District of Columbia received less CARES Act funding than any state: about $ 500 million. In order to keep workers and businesses alive, Mayor Muriel Bowser and the DC Council needed to add heavily to their own initiatives. They last announced in November a $ 100 million bridge fund to stop difficult companies and test the infrastructure. While $ 20 million of that was CARES Act money, $ 80 million came from the city. The program was $ 35 million for restaurants, $ 30 million for hotels, $ 20 million for entertainment, and $ 15 million for retail.
“Before the pandemic, the government was very healthy financially,” Democratic Council President Phil Mendelson said in an interview. “So we took the excess money and took it for relief, and also to help with budget constraints.”
The district has also taken a number of steps that were not delved into the contingency reserve. Last council member in December passed an invoice This will require restaurant, venue and retail employers with 50 or more employees to reinstate workers laid off during the pandemic once their jobs reopen. Previously, the council had enacted other measures such as capping fees for restaurant delivery services, requiring utilities to submit payment plans and the release of “less concerned offenders” from prison, Mendelson said.
But this is where the Council taps, warned Mendelson. In the absence of government assistance, the district’s declining revenues mean members’ hands are tied.
“It’s not sustainable in the long run,” said Mendelson. “We can hardly do more.”