“Now is the time,” said Lee Saunders, president of the American Federation of State, County and Municipal Employees, in an interview in which he predicted more layoffs in the public sector. “The essential services upon which the citizens of this country depend will be cut, and they will be cut, and the people of these respective communities will be hurt.”
Congress allocated $ 150 billion to state and local governments under the CARES Act in March, but limited the use of that money to coronavirus-related costs. Senate Majority Leader Mitch McConnell rejected calls for more support of $ 500 billion and said the money was better spent elsewhere.
With local economies ravaged by the pandemic, officials “are very opportunistic in trying to find ways to bridge the gap and provide credit where they can to help people and businesses stay prosperous during the pandemic” Dave Wallack, head of the Association of Democratic Treasurers, said in an interview. “Every state in the country thirsts for federal funds, and nothing can replace the federal government.”
Here’s a look at how six states and one city – Washington, DC – are using their own scarce resources to boost the economy, protect vulnerable people, and keep money flowing to their own agencies.
The Colorado state legislature called a special session in the first week of December to pass a series of bills channeling state cash to local restaurants and pantries.
The $ 342 million package directs $ 5 million toward the state pantry assistance grant program, $ 60 million in rental and mortgage assistance, $ 50 million in tax breaks for restaurants, $ 45 million for child care providers, $ 20 million for high-speed internet access for educators and students, and $ 5 million to help residents pay utilities and $ 57 million for the creation of a program to help small minority businesses and arts organizations.
The state also launched a new program this month that leverages $ 200 million in private capital and $ 50 million in government revenue to provide below-market loans to small businesses.
The federal paycheck protection program “was a lot of money, but it ended up going to big business across the state,” Treasurer Dave Young, an elected Democrat, said in an interview. “And the smaller… businesses that didn’t have a banking relationship were left out of the mainstream.”
To fill the gap, the state created a “very small” grant program, the Colorado Energized Gap Program, to channel funds from the CARES Act to “our smallest of our small businesses,” Young said. “But along the way, we also started thinking about companies that had been successful for one, two or three years before the pandemic hit, but are now struggling and, if they get the kind of support they need. , would have a lifeline and be able to survive.
“We wanted to provide these businesses that we know have been viable… working capital that they use to get their businesses going,” Young said.
In Wisconsin, state legislators have been the least active of all full-time state legislatures.
So Sarah Godlewski, the elected state treasurer, took matters into her own hands.
“These are unprecedented times,” Godlewski, a Democrat, said in an interview. “And so we must take unprecedented action.”
Godlewski began making calls around the state to see what she could do in her capacity 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. But we don’t have all the tools and resources to meet this need for distance learning, ”said Godlewski.
Godlewski’s mind turned to the state’s Common School Fund: when Wisconsin became a state, he acquired public land which he then sold. The proceeds from the sale were then put into the fund, managed by the Council of Public Lands Commissioners, which pays annually to public schools across the state.
It was time to retire on rainy days, reasoned Godlewski.
The distribution of $ 5.3 million was announced in April, and schools received the money a few weeks later. This was in addition to the $ 38.2 million already planned for distribution in 2020.
The money added a spending jolt to the state’s slump in the economy – and provided the learning tools needed to help close the distance learning gap.
“Teachers could buy these hot spots, could buy these Chromebooks, to help kids who were really at a disadvantage because their parents didn’t have the resources to install them,” Godlewski said.
Godlewski took another step to support the economy: He was working with county and municipal treasurers to identify people who were on the verge of becoming in default of their property taxes for the first time. She helped pilot a program – the COVID Property Tax Foreclosure Prevention Program – that contacted underemployed or jobless homeowners “through no fault of their own” to help them meet the payment and avoid being dragged into a cycle of higher interest rates.
In addition, the state set up a program that assisted local governments, mostly located in rural communities, who were not eligible for CARES law funds and were unable to obtain loans to finance projects in a context of declining income and increasing expenses.
“I have to be creative because it’s my only option during this crisis,” she said.
New Mexico officials passed a bipartisan relief bill last month that will issue a one-time check for $ 1,200 to every unemployed person and provide $ 100 million in small business grants.
Democratic Governor Michelle Lujan Grisham signed the bill a day after both houses of the Legislature overwhelmingly passed the bill.
“I am grateful to the Legislative Assembly, both houses and both parties, for their work,” Lujan Grisham said in a statement after signing the measure. “New Mexico will always stand up, even if the federal government won’t.”
More than 100,000 New Mexicans are expected to receive the $ 1,200, the governor’s office said.
The pandemic relief package also included other assistance, such as $ 15 million for emergency housing and other homeless assistance; $ 5 million for emergency food bank services; $ 5 million for direct assistance to low-income residents who have not received an “economic impact payment” from the federal government; and $ 10 million for contact tracing, testing and vaccine distribution.
District of Colombia
The District of Columbia has received less funding from the CARES Act than any other state: about $ 500 million. To keep workers and businesses afloat, Mayor Muriel Bowser and DC council have been forced to strongly complement their own initiatives. More recently, in November they announced a $ 100 million bridge fund to support struggling businesses and test infrastructure. While $ 20 million was CARES Act money, $ 80 million came from the city. The program set aside $ 35 million for restaurants, $ 30 million for hotels, $ 20 million for entertainment and $ 15 million for retail.
“Before the pandemic, the government was in very good financial health,” Council President Phil Mendelson, a Democrat, said in an interview. “So we took this excess money and we put it into relief and also to help fill the budget deficits.”
The district also took a number of measures that did not involve drawing on contingency reserves. Most recently, council members passed a bill in December requiring employers in restaurants, establishments and retail with 50 or more employees to reinstate workers made redundant during the pandemic as soon as their jobs reopen. Previously, the Council had promulgated other measures such as caps on the amount of delivery services that can charge restaurants, the requirement for utilities to provide payment plans, and the release of “offenders of less concern” from prison. , Mendelson said.
But that’s about where the board draws, warned Mendelson. Without federal assistance, the district’s declining income means members’ hands are tied.
“It’s not sustainable in the long run,” Mendelson said. “There is little we can do more.”