Coalition urges Senate to provide immediate pandemic relief to state and local governments

A coalition of more than 170 businesses, labor unions and government associations sent a letter to U.S. Senate leaders on Monday requesting immediate financial relief for states and local governments, which now face billions in shortfalls as they finalize their budgets.

The letter, which is supported by groups including the National Governors Association, National Conference of State Legislatures, National Association of Counties, National League of Cities and U.S. Conference of Mayors, urges relief as the coronavirus pandemic continues to disrupt many of state and local governments’ major revenue sources and “threatens” critical jobs supporting services in health care, education, public safety and transportation.

“In less than two days, the budget years for 45 states and thousands of local governments will begin. Unlike the federal government, these state and local governments must begin their fiscal years on time and with a balanced budget,” the letter reads. “If the Senate fails to act immediately to support state and local governments, our nation’s recovery from the pandemic-induced recession will suffer and millions of Americans will needlessly be harmed.”

According to data from the National Conference of State Legislatures, many states are expected to see steep revenue declines. California, Colorado, New Mexico and Wyoming are among those hit hardest as they face revenue declines of at least 20% in fiscal year 2021.

The groups claim in their letter that already 26 states have announced construction delays for transportation projects and warn those delays will ripple through the construction industry, delaying the nation’s recovery to the pandemic.

They point to a June letter from the Congressional Budget Office forecasting the nation’s gross domestic product for 2020 and 2021. It found that “state and local governments’ purchases of goods and services fell by $350 billion, making up 9 percent of the total decline in GDP.”

The groups also note that more than 1.6 million state and local government workers have lost their jobs since March.

“Leaders in Washington have expressed support for flexible fiscal aid to states and localities of all sizes. Yet months have gone by and our communities continue to suffer. Americans have a history of standing together in times of crisis and must do so now,” the letter concludes.

Absent from the letter’s signees is the National Association of State Chief Information Officers. NASCIO director of government affairs Matt Pincus told StateScoop the letter was missing mention of one of the group’s key priorities.

“While we support increased funding to [state, local, tribal and territorial governments] in COVID stimulus legislation, we declined to sign onto the letter because it didn’t mention cybersecurity funding or IT modernization funding,” Pincus wrote in an email. “We’re continuing to engage with the Hill and many of the associations on that letter to advocate for those priorities.”

In addition to requests from groups like NGA and NASCIO, four Democratic members of the House Homeland Security Committee requested additional support for state and local governments after May’s $3 trillion stimulus package did not include explicit funding for state and local governments’ technology initiatives.

The anticipation of budget cuts is already affecting some state and local governments. Washington, D.C., Chief Technology Officer Lindsey Parker earlier this month proposed merging the city’s digital connectivity and “smart city” programs to streamline operations to help meet a target of 3-5% savings across the city budget. State governments, meanwhile, are increasingly relying on automated technologies, such as chatbots, as they respond to innumerable requests for digital services during the pandemic.