17 state treasurers call on Congress to approve stimulus with $350 billion in state and local aid

17 state treasurers call on Congress to approve stimulus with $350 billion in state and local aid
President Joe Biden delivers remarks at an aluminum manufacturing facility in Manitowoc, Wisconsin, on September 21, 2020.Jim Watson/AFP via Getty Images
  • Every elected Democratic state treasurer is calling on Congress to approve $350 billion in local and state aid.
  • In a letter, treasurers outlined the impact the funding could have on jobs and vaccine efforts.
  • Insider spoke to three state treasurers about their support for the funding.

Every elected Democratic state treasurer is calling on Congress to approve the American Rescue Plan, including the provision with $350 billion in state and local aid.

The 17 treasurers signed on to a letter organized by Invest in America Action calling for the necessity of that full relief. States received $150 billion of additional relief funding from Congress in last March's CARES Act; now, nearly a year later, state treasurers from New Hampshire to Vermont say more is needed. State and local government employment has lost 1.4 million jobs during the pandemic. The letter from the treasurers also notes how shortfalls have impacted states' vaccinations efforts, leading to them "lacking the resources it will take to get the shots in people's arms needed to control the pandemic."
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Recently, 10 Senate Republicans proposed their own coronavirus relief bill, which came in at $618 billion and didn't include any funding for state or local governments.

"I think the biggest gap between the president's proposal and the Republican proposal relates to [$350 billion] or so going to states and localities," Sen. Mitt Romney (R-Utah) told reporters, according to USA Today. "That kind of number just makes no sense at all."

Insider spoke with treasurers from Kansas, Wisconsin, and Iowa about the necessity for more funding

In the letter, the 17 treasurers say that state and municipalities are using their limited resources to fight the pandemic - but a fuller economic recovery will also require investment in long-term growth.
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"Congress has the power - and the responsibility - to step in and fill the gap during this emergency," they write. "It's the only way that states can avoid more cuts to services needed by small and large businesses, hospitals, schools, health care facilities, and vaccination efforts."

The treasurers also note that funding would help support essential frontline workers like firefighters, teachers, and healthcare workers. "What we're worried about in the future - and the reason that we need to get this to local cities and counties and local municipalities - is that, while some of their PPE expenses and testing and things were covered with CARES act, there is no funding for that going forward," Kansas' Lynn Rogers told Insider.
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Rogers said Kansas was able to put some of its initial CARES money toward broadband expansion, but that's just one area that needs more investment.

That's also been the case in Wisconsin, whose Treasurer Sarah Godlewski said, "We are seeing a significant increase in expenses, whether it is for PPE [or] to additional safety precautions that they have to take. At the same time, we're seeing a decrease in revenues."

And Iowa's Michael Fitzgerald said that while his state currently has a balanced budget, the money that's come through so far has been mostly allocated to bigger corporations or farmers. The state's aging unemployment system still requires updates, he said, making it difficult to disperse extended unemployment benefits to residents.
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"We need more money to help the people in the bottom half," Fitzgerald said.

In response to a JPMorgan report that showed states did not see as significant drops as expected in tax revenues (although losses were uneven), White House Press Secretary Jen Psaki said "our objective is to focus on not what JPMorgan reports, but what state, local governments and others are telling us they need to ensure that the people in their districts."

"We are cutting costs, whether it's at the state or local level," Godlewski said. "We are being scrappy, and figuring out how we can reallocate resources in ways that we've never imagined before."
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