On March 27, the U.S. House is expected to approve the approve the Coronavirus Aid, Relief, and Economic Security Act, or CARES Act, intended to bring financial relief to Americans and businesses impacted by the coronavirus. The Senate passed the relief measure by unanimous vote on March 26 and the President is expected to sign the legislation.
Although the CARES Act provides for many of the immediate needs of municipal governments to prevent economic decline, for the governments themselves and their residents, GMA thinks that it will prove to be insufficient for intermediate and long term economic stabilization. The Coronavirus Relief Fund established under the CARES Act will primarily help states, and the potential impact on local budgets is largely unknown at this point because Governors will have maximum flexibility to allocate resources from the fund as they see fit. A summary of key provisions is available here (Word document).
We are encouraged that Congressional leadership is thinking ahead to a possible fourth Emergency Supplemental Appropriations and Stimulus bill. This could be considered in tandem with the annual FY2021 spending bills. For local governments, the fourth bill should:
- Allocate federal funding directly to local governments for local budget relief. 75% of Georgia’s cities have a population of 5,000 or less. All local governments should have access to federal relief funds.
- Approve additional supplementary funding to put residents impacted financially by the COVID-19 response on the path of economic mobility, to the greatest extent possible.
- Use this as an opportunity to reduce regulatory burdens and unfunded mandates on local government.
- Provide governmental employers the access to tax credits for the paid sick and paid emergency leave that they are required to provide to employees. (Note: the 2nd supplemental (HR6201, the Families First Coronavirus Response Act) included provisions for workers. NLC shared two factsheets on the bill, which can be found here and here. GMA joined NLC and other organizations representing local governments to oppose a provision that provides credits against payroll taxes for only some employers, excluding local governments.)
The stabilization fund for cities and states was a contentious issue throughout the development of the supplemental package, and at one point was pulled from a draft text of the bill. GMA and city officials across Georgia have been engaged with our federal leaders and with the National League of Cities with requests last week and this week to lower the population threshold or set aside a percentage of funds for local governments, but unfortunately House and Senate Leadership and the Administration felt that allocating to states and local governments over 500,000 would be the most effective and efficient way to allocate funds. We appreciate the efforts of Georgia city officials who have worked during this time to stay in touch with Georgia’s Senators and House members to advocate for the interests of all cities in this legislation. Our work must continue to address cities’ needs.
In the coming weeks, we urge city officials to remain in touch with Georgia’s Congressional delegation to make them aware of these priorities. GMA will continue to advocate on behalf of our 538 member cities, but it is important for Congress to hear directly from municipal leaders.