My heart goes out to the Americans who are suffering. More than a million Americans have been diagnosed with COVID-19 and more than 80,000 have died. Those numbers are rising every day. The crisis has been the most severe economic shock that our nation has experienced in many decades, even more severe than the fiscal collapse of 2008-09.
Because this suffering is likely to continue, I believe that Congress needs to do more. The American public expects us to act, and we must not let them down.
Congress did not hesitate to act in providing more resources to our small businesses and our health system. We should show the same willingness to direct more resources to individuals and families as well as to our state and local governments.
Individuals and families are hurting. More than 30 million Americans have filed for unemployment. People have lost jobs, some at businesses that may never re-open. And they have seen other unplanned expenses for health care or for child care as local schools have closed. Rent and mortgage payments, car payments, utility bills, food and medicine—these expenses continue, and the pressure on working Americans is intense.
The CARES Act provided $150 billion in block-grant funding to states and localities for the unanticipated costs connected to COVID-19. But the CARES bill would not allow state and local governments to use their funds to broadly backstop lost revenues. Right now, this is having serious consequences.
I was a mayor and a governor. I know that 46 states have a fiscal year that starts on July 1. That means most states and local governments are working on their budgets right now. They have to project income and expenses for the next year and write their budgets accordingly.
What are state and local governments seeing? Massive declines in tax revenue. Jurisdictions are trying to figure out the exact extent of the likely decline, and the drops are sizable—10 percent to nearly 18 percent for some Virginia localities. And the commonwealth of Virginia is expecting a decline in revenue of between $2 billion and $3 billion over the next two fiscal years.
If cities, towns, counties and states lose revenue, what are their options? Since most government costs are personnel, that is what they will be forced to cut. That is already happening in Virginia, and all around the country. Every state, city, county and town in this country is having to make the same decisions.
It shouldn’t be this way. It is never a good time to lay off teachers, firefighters, police, sheriff’s deputies, and EMTs. Never. But I can tell you the worst time to do it—a national health emergency.
Compare states’ and localities’ $150 billion under the CARES Act with what we’ve done for businesses: nearly $1.2 trillion. I am glad we are helping our businesses get through this, but don’t the communities where we live and work, send our kids to school, pray and play, deserve help to get through this crisis, too?
That’s why there must be a sense of urgency about more aid for state and local governments—for their employees—the front-line heroes that Americans are relying on during this unprecedented crisis.
We need to go well beyond the $150 billion that has been provided to state and local governments. And we need to give them the same flexibility to use their funding to cover excess expenses or revenue shortfalls that we have provided to businesses.