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Posted on: May 22, 2020

Call for Federal Lifeline

New Jersey Main Streets will not recover their vibrancy, without effective local services. Programs for Senior Citizens will suffer, without the support of municipal government. Youth recreational opportunities will shrink, without local assistance. But the costs of contending with COVID-19, and the loss of revenues that the virus has dealt – and will continue to deal – to local budgets, will force municipal officials to slash funding across important line items. They will need to reassess every single expenditure. And those services, that support, and that assistance might be substantially less than anyone would want it to be.

If local economies are to recover – if local communities are to flourish again – local citizens and businesses need vital local services. New Jersey municipalities need a Federal lifeline. We sincerely appreciate the many members of our State’s Congressional Delegation who are working on our behalf.

Last Friday, the House of Representatives passed the HEROES Act. Thanks to the advocacy of Congressman Frank Pallone, that bill includes a $375 Billion ‘Coronavirus Local Fiscal Relief Fund.’ The vote, largely along party lines, was 203-199. Though declared ‘dead on arrival’ in the Senate by Majority Leader Mitch McConnell, this action is becoming the basis for further negotiations toward a bipartisan consensus on the next COVID response action in Washington.

On Monday, Senator Bob Menendez introduced in the Upper House S.3752, the State and Municipal Aid for Recovery and Transition (SMART) bill. On Tuesday, Congresswoman Mikie Sherrill introduced its companion, H.R. 6954, in the House. Sponsors for S.3752 include three Republicans and three Democrats, including our Junior Senator Cory Booker. H.R. 6954 lists as cosponsors five Democrats and five Republicans, including New Jersey’s Josh Gottheimer. That kind of across-the-aisle support will be crucial to success in Congress.   If enacted, the SMART Fund would provide $80.6 Billion for all American municipalities, regardless of size, would be matched by another $80.6 Billion for all American counties.

Also on Tuesday, Federal Reserve Chairman Jerome Powell told the Senate Banking Committee that failing to provide relief to state and local governments could put a drag on the economy for years. “We have the evidence of the global financial crisis and the years afterward, where state and local government layoffs and lack of hiring did weigh on economic growth,” he said. 

"Something like 13% of the workforce is in state and local government. A lot of the critical services that people rely on day to day are you know, provided at the state and local levels. With ... balanced budget provisions … revenue goes down sharply, it can mean job cuts or service cuts. So, those are all important things to consider in going forward," the Chairman stated.

As Congress has debated a series of COVID relief bills over the past few months, the New Jersey League of Municipalities has consistently supported funding for small businesses, funding for health care, funding for non-profits, funding for the unemployed, funding for mental health and addiction disorder services, funding for schools, and funding for the State of New Jersey. But Congress has yet to pass a bill earmarking a single penny of general aid for a single New Jersey municipality.

Please thank Senators Menendez and Booker and your District’s Representative in the House for their efforts on our behalf. And please reach out to your business community and to your non-profit service providers. They need to add their voices to yours.

The National League of Cities, our partner in Washington, has launched a national campaign to focus attention on what municipalities are doing, on what they need to continue to do it, and on what they will need to restore local economies and the social fabric of their communities, severely weakened by the stress of COVID-19. More than 170 business and community organizations have already endorsed the Cities Are Essential campaign, aiming to achieve one clear goal: Direct federal support for cities, towns, townships, boroughs, and villages, regardless of size.

Contact: Jon Moran, Senior Legislative Analyst, jmoran@njlm.org, 609-695-3481 x121.


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