27 US cities that could see their budgets devastated by coronavirus
- The novel coronavirus has not only affected the economy at the state and national levels, but also at the city level.
- Brookings published a report about the varying fiscal health of cities across the US and how quick 139 cities will take an economic hit from the pandemic.
- Columbus and Cincinnati, Ohio, made the top of the list of cities that are likely to experience a more immediate fiscal impact from the coronavirus because of their large share of elastic sources of revenue.
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Cities across the US will not feel the economic impact from the novel coronavirus at the same time because of their varying fiscal health. Cities that are expected to see a more immediate impact will experience an economic hit within the next two months, according to a new Brookings Institution report.
Brookings examined how quickly 139 US cities will feel a fiscal impact, based on their different sources of revenue.
The researchers categorized cities with more immediate, medium-term, and longer-term fiscal impact from the pandemic, based on how much each city relies on elastic sources of general revenue. The analysis was based off 2019 sales taxes and other tax figures, as well as cities' share of industries vulnerable to significant job losses because of the coronavirus.
Brookings noted in its analysis that how quickly a city will feel the economic effects of the coronavirus depends on its main source of revenue and how susceptible that is to the changing economy during the pandemic.
According to the report, cities that are "highly reliant" on elastic sources for their revenue and have a high share of at-risk industries that rely on income taxes will see a more immediate impact. This includes cities that largely rely on sales taxes, because many stores are temporarily closing as states enforce lockdowns.
The researchers wrote, "A city that generates the majority of its revenue from sales or income taxes will be hit hard and immediately when it experiences such consumer declines and job losses."
In contrast, the report mentions that a US city reliant on property taxes won't see an economic impact until later.
Based on the analysis, 43 cities are expected to see a more immediate fiscal impact from the pandemic. Cities in the northeast will mostly see a longer-term impact, and all cities in Florida used in the analysis will see a medium-term impact.
Multiple cities in Ohio and Colorado are projected to feel a more immediate impact than other cities in the US. For instance, of those cities expected to feel a more immediate impact, Columbus, Ohio, had the highest share of general fund revenues from elastic sources, deriving 75.47% of its revenue from income taxes.
Read on to find out the 27 cities that had the highest share of elastic sources for revenue, from the list of 43 expected to feel the most immediate fiscal impact from the coronavirus:
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27. Indianapolis, Indiana
26. Columbus, Georgia
25. Lubbock, Texas
24. Tucson, Arizona
23. Montgomery, Alabama
22. College Station, Texas
21. Scottsdale, Arizona
20. St. Louis, Missouri
19. Lincoln, Nebraska
18. Birmingham, Alabama
17. Kansas City, Missouri
16. Denver, Colorado
15. Oklahoma City, Oklahoma
14. Lexington, Kentucky
13. Akron, Ohio
12. Fayetteville, Arkansas
11. Louisville, Kentucky
10. Tulsa, Oklahoma
9. Grand Rapids, Michigan
8. Springfield, Missouri
7. Colorado Springs, Colorado
6. Aurora, Colorado
5. Cleveland, Ohio
4. Toledo, Ohio
3. Bowling Green, Kentucky
2. Cincinnati, Ohio
1. Columbus, Ohio
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