Democrats in Washington are pushing an ambitious stimulus plan which includes direct aid to states and localities.
While details are still emerging, the HEROES Act, which is double the size of the CARES Act, will include funding for testing, unemployment insurance, and most tantalizingly, $500 billion for states and $375 billion for local governments like the City of Albany.
Local leaders like Albany Mayor Kathy Sheehan are running out of adjectives to describe the future of municipalities without the federal government’s help.
“It’s dire. We’re looking at projections that are really, from my perspective, I’ve never seen anything that would result in the level of cuts that we would have to make in order to address the lost revenue that we’re looking at,” she told Spectrum News over Skype.
Earlier this month, the City of Albany estimated its revenue shortfall for the year to be between $17-20 million. It has already meant layoffs, and will likely mean more.
“We are looking at, in addition to the 50 crossing guards we have laid off, we are looking at anywhere from 75 to potentially more than 100 additional layoffs,” said Sheehan.
Sheehan also says that tax increases are inevitable if federal aid doesn’t show up soon.
“I want to do things like waive the fees that we charge for our sidewalk cafes. I want to be able to do what we can to help our businesses reopen by ensuring that we’re not layering on all kinds of permit fees and additional expenses to them,” she said. “Those are things that if we had the certainty of having our revenue replaced, we have the flexibility to do.”
If it’s passed, the HEROES Act would extend into 2021. If it’s not passed, says Sheehan, “Then we have to make these horrible decisions. Decisions that are going to impact parents’ ability to go back to work. If we don’t have summer programs, how are parents going to go back to work?”
Even if the House passes the package this week, it still needs to be voted on in the U.S. Senate, where Majority Leader Mitch McConnell has said there is no “urgency.” According to the Associated Press, the Senate will wait until after Memorial Day to consider options. McConnell has also called the House proposal a grab bag of “pet priorities.”
To hear the squabbling of elected officials in Washington, you would think many don’t realize that cuts to municipalities mean cuts to the very workers the country is depending on to protect the public from the pandemic: police, fire, emergency medical technicians, sanitation workers, teachers.
Sheehan calls the squabbling “tone deaf.” On weekly calls to mayors around the country, she says there is almost universal support for direct aid to cities. She said the leader of the U.S. Conference of Mayors “is a Republican mayor, and he is leading the charge on trying to get this legislation passed in Washington.”
Cuts to services, which will be made in the City of Albany if help from Washington isn’t forthcoming, will be “to the bone.”
“We cannot cut people without cutting services,” Sheehan said. “We have done everything that we can over the last 7 years to become as effective and efficient as we can, and I’m proud of the work that we’ve done, but it does not leave a lot of room for us to be able to make the types of cuts that revenue projections are suggesting we would need to make.”
The City of Albany has a rainy day fund that’s close to $9 million. But that may not last too long.
“Right now, we’re looking at using half of it,” said Sheehan. “We’re going to have to see how the year plays out. This may not be the first round of layoffs. It’s going to really depend on what happens at the federal level and when we can hopefully expect to see some relief from Washington.”
Like the governor, Speaker Carl Heastie and others, Sheehan believes that states and cities have waited long enough for relief.
“We’ve bailed out the cruise lines and the airline industry and a lot of big companies, and that has helped to keep the economy from completely faltering, but we’re now talking about our police officers, our fire fighters, our sanitation workers, the people who really make a city work,” she said.
But the news may get worse before it gets better. A report out Wednesday from the state comptroller’s office shows the state’s out-year budget gaps totaling $25.6 billion.
According to the AP, the HEROES Act will also offer $1200 direct cash aid to individuals, up to $6000 per household; $175 billion in housing assistance; 15% increase to food stamps; a $600 dollars per week addition to unemployment benefits; and $200 billion in “hazard pay” for essential workers.