Leaders from the National Association of Counties (NACo) on Thursday made an urgent call for "direct and flexible" federal funding to help the local governments deal with the economic impacts of the coronavirus crisis as Congress negotiates another relief package.
Citing the need to fund their health departments, hospitals, long-term care facilities and more -- as well as "plummeting" revenue due to shutdowns aimed at slowing the spread of the virus -- officials said they need fiscal help from the federal government to deal with the pandemic. NACo Executive Director Matthew Chase said counties expected to see a $202 billion fiscal impact from the crisis and requested help as they continue to, in many cases, be on the front line of the pandemic.
"We literally have to process the dead bodies," Chase said in a conference call with reporters. "Those counties that have been in the hotspots have really been taking it on the chin both financially, emotionally and operationally."
The NACo officials on the call said they are not "tied to" a specific dollar amount from Congress and that they were committing to being responsible with taxpayer money, but still emphasized that they need a cash infusion.
"We have great sympathy for what's happening at the federal level," Chase said of concerns that the upcoming $1 trillion-plus piece of legislation could continue to balloon the deficit. "But we do need another surge of federal investment."
NACo had previously asked for a $250 billion assistance package along with the National League of Cities and the United States Conference of Mayors.
As an example of the kind of impact the coronavirus crisis is having on local governments, Chase cited a $1.2 billion decrease in sales tax revenue seen by the New York Association of Counties alone. Teryn Zmuda, NACo's chief economist, said that 88 percent of counties in a survey had seen budget impacts from the coronavirus crisis.
Local governments aren't the only ones fiscally squeezed by the coronavirus crisis. Maryland Gov. Larry Hogan, a Republican, and New York Gov. Andrew Cuomo, a Democrat, released a joint statement on Wednesday reiterating their request for $500 billion of aid to states in the next coronavirus relief bill.
"In order to support states in the continuing pandemic response, a $500 billion state stabilization fund must be included in any COVID-19 relief package from the Senate," Hogan, the NGA chairman, and Cuomo, the NGA vice-chair, said.
The proposed virus aid package in the Senate would be the fifth, following the $2.2 trillion bill passed in March -- the largest U.S. intervention of its kind.
The fight over how much aid goes to state and local governments is likely to be one among many high-stakes fights as Congress works to pass another coronavirus relief bill in the coming weeks. Congressional Democrats -- and state and local officials -- have been vocal in advocating for federal aid to be given out liberally, citing the revenue hits the economic shutdown has dealt to state and local governments. Those jurisdictions, they emphasize, also cannot borrow money like the federal government can, meaning they are likely to face even more dire financial straits.
Some congressional Republicans, on the other hand, have balked at opening the spigot of federal money for state and local governments. Among them is Senate Majority Leader Mitch McConnell, R-Ky.
"I mean, we all represent states. We all have governors regardless of party who would love to have free money," McConnell said in an April interview on the "Hugh Hewitt Show" in response to a question on what the federal government should do to help states in tricky financial situations. "And that’s why I said yesterday we’re going to push the pause button here, because I think this whole business of additional assistance for state and local governments need[s] to be thoroughly evaluated."
McConnell then mentioned that many states are struggling with funding pensions or similar programs, saying "[t]here's not going to be any desire on the Republican side to bail out state pensions by borrowing money from future generations." He added that states should be able to declare bankruptcy, saying "it saves some cities."
The House Democrats' bill passed in May, which had a $3 trillion price tag -- making it the most expensive single piece of legislation in American history -- included $915 billion for state and local aid. That money, Democrats said, could prevent layoffs of public workers, like first responders and teachers. NACo officials said Thursday economic harm to counties, without adequate federal assistance, could result in a $344 billion reduction in GDP and the loss of 4.9 million jobs.
Republicans have not seriously considered that bill in the Senate, and the Senate GOP is this week hashing out its coronavirus plan, which McConnell has said will cost about $1 trillion. It's unclear how much Senate Republicans may include for state and local governments in their plan.
Senate Republicans have indicated that they have come to a tentative consensus on their plan, and McConnell is likely to roll out the general framework of it, which could likely be broken into several bills, on Thursday. Any deal on final legislation is still far off, though, as Republicans have yet to run their proposal by Senate Democrats, let alone the Democrat-majority House of Representatives.
Fox News' Marisa Schultz and Chad Pergram, and the Associated Press contributed to this report.