WASHINGTON — U.S. Sens. Chuck Schumer and Kirsten Gillibrand, D-N.Y., renewed their fight to pass federal legislation in the coming weeks to provide funding to states and localities and evade deep cuts to essential services as the COVID-19 pandemic continues.
Passing legislation to directly fund U.S. states and localities is likely to be Democrats’ first action after assuming the Senate majority, the senators said. Current Senate Minority Leader Schumer is slated to become the chamber’s next majority leader after Georgia’s two Democratic senators who each won run-off elections last week are sworn in after results are certified later this month.
Schumer and Gillibrand announced plans to reintroduce the Direct Support For Communities Act in the new Congress to provide broad state and local fiscal relief as all U.S. states face deep budget deficits due to the coronavirus pandemic.
“We all know we have to take care of our local needs,” Schumer said Tuesday during a joint virtual press conference with Gillibrand. “It’s vital. ...To respond to the pandemic, localities throughout New York and all over the country have heroically ramped up spending, have holes in their budgets, have drawn from their reserve and we know they all face significant losses of revenue. Even though they knew what the financial consequences would be, our localities have been determined to help whatever way they can to fight COVID-19.”
The National Governors Association, which Gov. Andrew Cuomo chairs and includes governors from all 50 states, has sent a letter to Congressional leaders pleading for $500 billion in federal aid for states and local governments at least five times since late last spring.
The Direct Support For Communities Act would provide half of an undetermined amount of emergency federal aid to cities and half to counties.
U.S. Rep. Antonio Delgado, D-19, helped senators put the bill together, Schumer said, which has a new formula.
“The earlier bills didn’t give enough money to localities and didn’t give enough money to states, so it’s a unique formula,” Gillibrand said. “We’re still collecting data from all the states to see the amount of need before a final amount is put into the bill. In the earlier funding rounds, we had trouble, for example, on Long Island where they got money under the big-city formula. This is a new proposal that I think is going to be better.”
Senators hope to pass the legislation within the first week of President-elect Joe Biden’s administration. Biden’s inauguration will be Jan. 20.
Biden is expected to repeal many parts of President Donald Trump’s Tax Cuts and Jobs Act, which decreased tax payments for the nation’s wealthiest millionaires and billionaires, Gillibrand said, adding repeals will likely add up to at least $1 trillion to help support relief measures.
Seventy percent of emergency fiscal assistance would be allocated to cities, towns and villages classified as Community Development Block Grant entitlement communities, Gillibrand said. The remaining 30% would be sent to states to suballocate to areas within 30 days based on population.
“Every municipality in the state would receive guaranteed formulaic funding,” Gillibrand said.
More than 1.4 million state and local workers have been laid off nationwide, with 40,000 in the state.
“We know there’s a cost to the sacrifices throughout the state and our country, and local workers have been forced to be laid off through no fault of their own,” Schumer said.
The state has an estimated $15 billion revenue shortfall, which is expected to grow to more than $31 billion over two years.
“The federal government must make up that gap, and if we don’t, there will be real consequences to people’s lives,” Gillibrand said. “States and local governments will have no choice but to lay off public health care workers, teachers and other vital public servants who are critical to our response. ...They’ll be forced to choose between cutting essential services at the moment they are most needed or raising taxes and fees on local businesses and families at the moment they can least afford it.”
Schumer and Gillibrand have called for local aid through the pandemic along with other state and county officials.
“I echoed those calls in the negotiating rooms to Sen. [Mitch] McConnell and [U.S. Treasury Secretary Steven] Mnuchin demanding we come together to get help to our states and localities,” Schumer said. “But with a new Senate majority, we’re going to have a new opportunity. This is one of me and Kirsten’s highest priorities for direct relief.”
Previous federal coronavirus relief packages included billions of dollars for education and emergency transit relief, rental assistance and distributing the coronavirus vaccine and millions for state transportation projects and childcare grants, but lacked direct funding for U.S. states and local governments to help offset budget gaps and prevent cutting thousands of essential workers needed most during the pandemic, Schumer said.
State and local relief is essential for the nation’s economic recovery, both senators said.
“It’s absolutely ridiculous to deny state and local aid when there’s an outcry from mayors from both parties,” Schumer said, adding the funds will help essential workers such as firefighters, EMS, sanitation and health care workers. “It’s vital that we do this. We’re going to keep fighting for it. We’re going to act swiftly and decisively to provide direct local federal aid to save tens of thousands of vital public service jobs.”