A bipartisan group of mayors said they will avoid increasing taxes to address budget shortfalls resulting from the pandemic, but will likely need to slash spending on services and salaries if aid for cities is not included in the next federal coronavirus relief package.
Senate Republicans released on July 27 a COVID-19 pandemic relief package — the Health, Economic Assistance, Liability Protection, and Schools (HEALS) Act — which includes no additional aid for state and local governments, despite pleas from local leaders and warnings from economists. The proposal will be a starting point for negotiations with House Democrats, who introduced the Health and Economic Recovery Omnibus Emergency Solutions (HEROES) Act, which would provide more than $1 trillion in aid to state and local governments.
During a July 28 press call hosted by the National League of Cities and the U.S. Conference of Mayors, Nan Whaley (D), mayor of Dayton, Ohio, and vice president of the mayors' conference, said the Senate Republicans' relief package “dramatically missed the mark.”
Whaley said tax revenue collections in cities are continuing to drop, while expenses continue to climb. “Local leaders have been sounding the alarm on plummeting revenues for months,” she said.
More than four months ago, a bipartisan group of more than 300 mayors signed on to a request for direct, flexible, and emergency assistance to cities to help address budget gaps resulting from the pandemic, which has largely gone unanswered, Whaley said.
The HEALS Act would give local governments more flexibility in how to use funds allotted under the Coronavirus Aid, Relief, and Economic Security (CARES) Act. Van R. Johnson (D), mayor of Savannah, Georgia, said it is "just a drop in the bucket."
"We are looking for a full pail of water — 70 percent of cities did not receive CARES Act funding, and even those that did, it wasn't enough to offset crippling revenues, lost jobs, halted infrastructure projects, and more," Johnson said.
Whaley said in the absence of federal aid, Dayton will have to cut services, particularly frontline services, because "most of our costs are personnel and there is not a way for us to afford and move a tax increase."
Pittsburgh Mayor Bill Peduto (D) agreed, saying Pittsburgh has already implemented a 10 percent cut to personnel and will look at additional cuts for the next year's budget.
Johnson said that to balance the city's budget, he would likely cut services rather than increase taxes. “It would be unconscionable for us to be able to raise taxes on people who are already suffering," he said.
Jeff Williams (R), mayor of Arlington, Texas, said the city has already implemented three phases of budget cuts as part of a five-phase plan. The next cuts would be more drastic and include more furloughs and layoffs, Williams said.