During a budget crisis, the Republican playbook says to “never waste a good crisis.” So, they hold citizens hostage, then provide a miraculous rescue just in time for an election, and Republicans (especially Mitch McConnell) take the credit.
McConnell has rejected the House’s Heroes Act that passed with bi-partisan support. It provides a trillion dollars in state and local aid to impact state and local budget distress. McConnell refuses to consider it, despite a 15 percent unemployment rate, and despite bipartisan support from governors, the Federal Reserve chair, and the Treasury secretary. (* tick tock *)
The Heroes Act provides “direct aid to Kentucky’s budget of $3.3 billion in federal fiscal year 2020 and an additional $4.1 billion in 2021 for a total of $7.4 billion,” according to the Kentucky Center for Economic Policy. The state would also benefit from the reduction in the state’s share of Medicaid spending, saving $1.7 billion over 18 months. “In Kentucky, all 120 counties would receive a total of $2.5 billion, and 429 cities and other local government entities would receive $1.9 billion over two years.” Without federal aid, the governor and legislature are contemplating cutting $450 million in “state services, including education, health care and public safety, with an additional $161 million cut proposed for the Road fund.” (* Tick Tock *)
Kentucky counties and cities need the Heroes Act to be passed ASAP by McConnell’s Senate. This kind of direct, flexible aid is needed until the economy has fully recovered.
As an example, let’s consider Calloway County, and the city of Murray, both of which are facing significant budget shortfalls. The Heroes Act would provide Calloway County $21,933,216, and would provide $9,552,097 to Murray. That will go a long way toward making them able to keep operating without drastic cuts in services.
McConnell’s stalling and skimping makes NO economic sense. As the Center for Budget and Policy Priorities posts, “States and counties must balance their budgets every year. Without substantial federal help during this crisis, they likely will deeply cut areas such as education, health care, laying off teachers, nurses, first responders, and other workers in large numbers, and cancel contracts with many private sector companies.” (* Tick Tock *)
It is mind-boggling that the Republicans have yet to grab McConnell by the lapels and shake him to get going. Every week he waits, more layoffs follow, the recession worsens and the Republicans’ chances of losing the House, Senate and White House accelerate.
Local governments in Kentucky need significant federal relief if they are to continue providing crucial front line and community services through the COVID-19 pandemic.
Earlier in the spring, the Kentucky League of Cities conducted a survey of its members, with results suggesting cities will face a collective budget shortfall of $85 million in the current fiscal year ending June 30, and $180 million in fiscal year 2021. (* Tick Tock! *)
The limited federal assistance provided thus far is inadequate. The state of Kentucky will receive approximately $1.7 billion from the CARES Act, already signed into law, but the only local government large enough to receive a direct payment in Kentucky is Louisville. Any additional relief to local governments must come from the $1.6 billion Coronavirus Relief Fund Kentucky received, and Governor Beshear announced in May that local governments will receive $300 million from that fund. But that amount is not enough, and those funds are restricted in use for pandemic-related expenses and CANNOT be used to address Kentucky’s budget shortfall. (* Tick Tock!! *)
In short, The Heroes Act would extend unemployment insurance provisions, provide another round of individual stimulus payments, boost food and housing assistance, fund health care improvements to keep people insured, and pay for improvements to essential worker pay and childcare.
McConnell and the Senate were quick to give tax cuts to the wealthy in 2017. When the economy is on the ropes and our state and local governments are looking into the abyss, it is PAST time for them to come to the table and pass the Heroes Act! The clock is ticking!
* TICK TOCK! *