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City mayors are asking for direct funding they can use to help residents as federal lawmakers turn to a third bill to provide economic stimulus amid the pandemic.
President Trump signed legislation passed by the Senate Wednesday to provide emergency leave and unemployment benefits for some American workers amid the coronavirus outbreak, while city mayors called for the federal government to provide more direct assistance to local governments who are on the front lines of the epidemic.
The U.S. Conference of Mayors wrote to congressional leaders to ask for $250 billion in flexible emergency funding, saying the money will help keep basic services available as cities see revenues decline and expenses related to combating the economic soar.
“Lost revenue from economic contraction will put pressure on the ability to deliver basic services—including police, fire, water, and sewer—or aid business sectors that serve as the foundation of our metro economies,” mayors wrote in a letter sent Wednesday. “Without significant federal assistance, we soon will be faced with having to make decisions that could include laying off employees, cutting budgets, and reducing or eliminating critically needed services.”
The request for additional funding comes as the economic fallout from the outbreak continues to worsen. Stock markets continued to drop on Wednesday, businesses were shuttered and began laying off workers, and portions of the country have gone on lockdown to prevent the spread of the virus, which can come with flu-like symptoms and cause severe respiratory distress and death.
Some states are already incurring sizable costs as they respond to the pandemic, meanwhile large swaths of the economy have slowed to a crawl and state and local governments expect their tax revenues will plummet as a result.
The legislation signed by Trump was a bill originally drafted by House Democrats in conjunction with the Trump administration. It passed the Senate by a 90-8 vote. The law will provide free coronavirus testing for all, give some workers affected by the virus two weeks of paid sick leave, enhance unemployment protections for those who lose their jobs during the outbreak, and provide money to help feed children who rely on free and reduced-price lunch programs.
Most Senate Republicans supported the bill, at the urging of Sen. Majority Leader Mitch McConnell, despite criticism the paid leave provisions would burden small businesses at a time they are already struggling.
Ahead of the Senate’s passage, the House scaled back emergency leave provisions included in its original version. Those changes exempted companies with more than 500 employees from having to provide the amount of paid sick or emergency leave outlined in the bill.
Progressives critical of the proposal said the exemptions leave too many workers unprotected. While about 89% of companies with more than 500 employees provide paid sick leave, they often don’t provide the two weeks envisioned in the bill. The Economic Policy Institute estimates that exemptions in the bill will leave between 6.8 million and 19.6 million private-sector workers without paid sick days.
For those who would benefit from the revised emergency sick leave provisions, the bill ensures that full-time employees are paid their full salary, at up to $511 a day, for two weeks. Workers would also be entitled to two-thirds of their normal salary (at up to $200 a day) for two weeks to care for family members or children whose schools have closed.
Emergency family leave provisions would grant full and part-time workers 12 weeks of protected leave in the event they must care for their children in the event of long-term school closures. The first two weeks of leave would be unpaid, but could overlap with any paid leave workers are already provided by their employer and the next 10 weeks of paid leave would provide workers at least two-thirds of their salary.
On The Horizon
With the bill’s passage, lawmakers will now turn their attention toward crafting a third coronavirus aid package that could potentially provide $1 trillion in economic stimulus to address the slumping American economy. Senate Republicans are taking the lead on that proposal, which remains under discussion but would likely include direct cash payments to Americans. News outlets reported Wednesday that the Treasury Department is looking to issue $500 billion in direct payments to many Americans.
The Trump administration proposal would also include $50 billion for the airline industry, a $300 billion loan program to help small businesses avoid layoffs, and $150 billion for other distressed sectors.
While not dissuading those efforts, mayors also encouraged Congress to think about funding that cities could use to provide direct assistance to residents or their public health departments. In their letter, mayors cited several examples of how money to cities could be used, including the purchase of personal protective gear for health care workers, rental assistance to residents, and direct support for small businesses and childcare operations.
“Mayors will use newly appropriated funds to prevent further economic losses and provide security for our residents who lose jobs or wages and those who lack access to sick leave, stable shelter, or affordable childcare,” the U.S. Conference of Mayors wrote.
The Senate will remain in session until a third bill is passed, McConnell pledged Wednesday. He said the envisioned legislation would provide a “historic level of assistance for small businesses across America.”
“We want to help them survive this disruption, absorb the new mandate in the House bill, continue to make payroll and avoid layoffs as much as they can, and emerge from this storm in the best shape possible,” McConnell said. “That means a historic injection of liquidity and access to credit. And it means Washington D.C. working directly with the lenders who already work with these small businesses, to minimize the new bureaucracy, so the assistance can flow as fast as possible.”
The Republican-led efforts will likely run into some resistance from Democrats, who have already rolled out their own proposal, with Senate Minority Leader Chuck Schumer expressing criticism as reports suggested the Trump administration was eyeing a plan to dole out $1,000 checks.
“$1,000 goes by pretty quickly if you are unemployed. Expanded unemployment insurance would provide you a much bigger safety net,” the New York Democrat said. “If we are going to provide direct payments they need to be bigger, more frequent, more targeted.”
Schumer’s own $750 billion proposal would instead focus on four issues: expanding public health capacity, broadening unemployment insurance, expanding paid sick leave, and prioritizing workers in any industry bailout package.
Andrea Noble is a staff correspondent with Route Fifty.