Struggling local governments may be on the cusp of getting much-needed aid.
With the power of the Senate shifting over to the Democrats, an effort to provide direct aid to counties and local governments may finally be successful.
Senate Majority Leader Mitch McConnell, who called such aid a “blue state bailout,” is moving to the minority post next week after Democrats gained control of the body by winning the two Georgia Senate seats.
Replacing him as Leader is Chuck Schumer of New York, who, with fellow New York Sen. Kirsten Gillibrand, announced the upcoming introduction of their bill, the Direct Support For Communities Act. It would provide localities with direct federal relief to provide essential services and help offset decreased revenues and increased costs from the COVID-19 pandemic.
Schumer and Gillibrand will reintroduce their Act in the new Congress to deliver what they called “urgently needed” relief for communities across the state as part of a broader state and local fiscal relief fund.
“Although we were able to secure billions of dollars to aid the state and local effort in the last COVID relief package, much, much more is needed to fully address the health and economic crisis municipalities are facing down,” Schumer said in a press release earlier this week. “With the new Senate majority, we will finally be able to prioritize state and local aid in the next COVID relief bill.”
Added Gillibrand: “At a time when more people are in need, our state and local governments are in critical need of resources to help citizens. Instead, they have had no choice but to lay off workers and cut essential services, and will soon be forced to raise local taxes. The federal government must deliver relief to close this gap.”
The senators said they are pushing for passage of the Direct Support for Communities Act, in addition to direct relief to states. New York currently faces a $15 billion deficit, much of it caused by the pandemic.
Under the proposed bill, the local relief fund would be split 50/50, with half committed to cities, towns and villages and half to counties.
In a call with reporters, Gillibrand did not have a figure on how much money would be allocated in the bill.
Local officials, many of whom were forced to trim budgets because of reduced revenues, including sales tax, will welcome the funding, whatever the amount.
Geneva Mayor Steve Valentino noted that Congress had tried in previous bills to find more aid for smaller local governments. He doesn’t want lots of strings attached to the money.
“My hope is that any bill to provide relief would be targeted directly to the municipalities and have minimal administration cost along the way,” he said. “Too often these funds are diminished, and so are the impacts by the time they make it to those that need it the most.”
Seneca Falls Town Supervisor Mike Ferrara said the town is in good shape fiscally, but that aid to the county would be welcomed.
“This will be great news for Seneca County,” he said. “The county has been severely impacted by the loss of revenue from sales tax, room occupancy taxes and loss of revenue from del Lago casino. Monies from reserves were needed to balance the 2021 budget and keep property taxes flat in these very difficult times.”
Ontario County Administrator Chris DeBolt welcomes the aid as well.
“In general, Ontario County is extremely supportive of the efforts of senators Schumer and Gillibrand to provide direct aid to state and local governments,” he said. “Counties fund critical public safety, public health, emergency benefits, mental health, substance abuse and other services that are in greater need than ever as we continue to struggle with the COVID pandemic. Forcing county governments to cut vital services that our communities need to emerge from this crisis will prolong the post-pandemic recover and add to the already significant level of pain our residents have experienced throughout this public health emergency.”
DeBolt said he “urges members of the House of Representatives and the United States Senate to put aside the current acrimonious political discourse and pass an aid to localities relief package immediately that will provide direct and immediate relief to our beleaguered communities.”
Wayne County Administrator Rick House said the county has weathered the pandemic well so far, thanks to strong sales tax revenues through new internet sales collections adopted by the state, as well as through a healthy fund balance. But with an economic slowdown caused by the pandemic expected to drag into 2021, he said the federal aid would be very helpful.
“It’s a step in the right direction,” said House of the bill. “Anything that we can get from the federal government to assist us can help out.”
He noted that counties deserve a good chunk of the money because they bear a large portion of the state-mandated programs, many of which are needed now more than ever.
“We (counties) are the ones who provide those services,” said House.
Schumer and Gillibrand said the Direct Support For Communities Act would help local governments avoid further layoffs and local tax and fee increases that would place a heavier burden on families and businesses at a time they can afford it the least.
In Geneva, the city made numerous cuts because of reduced revenues, mostly from lower sales tax receipts.
At-large Councilor Anthony Noone said the aid is welcomed.
“Geneva is no exception from other municipalities across our state and nation that have suffered financially at the hands of the pandemic,” he said. “The loss of sales tax revenue and increased expenditures with no financial relief has and will continue to cripple our city’s finances. As we transition from the response phase as a local government into the recovery phase, this bill’s passage will hopefully shore up our losses and lead to our ability to regain our financial footing.”