If you’ve felt dismayed about the state of our nation’s communities lately, you’re not alone. On top of the nationwide unrest, cities across the country are still facing unprecedented challenges as we work to keep our citizens safe from further spread of the coronavirus pandemic. What’s more, the bipartisan shutdown of our nation’s economy has strained the budgets of cities large and small, urban and rural, and of all political stripes, putting them on a precarious financial path from which there may be no return.
If congressional action isn’t taken soon to provide direct federal assistance to our nation’s cities, towns, and villages, the future of the vast majority of communities will be in jeopardy.
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Through no fault of our own, cities such as the one I represent are on a collision course that could cripple our ability to provide essential public safety and health services during an increasingly turbulent time for our country. Mounting expenses, coupled with a steep decline in tax revenues from local business activity, are pushing once-healthy municipalities toward a financial crisis they cannot weather without the necessary support from our federal partners.
In my home state of Pennsylvania, our municipalities are facing a 40.2% revenue loss this year alone. Cities with less than 50,000 residents, including my own, will be among the hardest hit.
I understand the reluctance of some fiscal conservatives to increase federal spending. As a Republican who has lived by the principles of fiscal conservatism my entire life, my biggest concern is the financial state of the country we leave behind for the next generation. Although no state or local government should be expecting a no-strings-attached blank check from the federal government, we also cannot afford to risk an even more devastating financial situation down the road.
That is precisely why we need congressional relief now. The cost of inaction will ultimately be exponentially higher than the cost of additional federal aid. The unprecedented situation in which we find ourselves today means that providing recovery funding in the near term can provide us with the fiscal certainty and stability required to rebuild our economy in the long term.
Because cities such as mine have to balance their budgets each year, the revenue losses we’re experiencing will mean cutting back on critical municipal resources that have been helping our neighbors get through the pandemic and back on their feet. According to a recent survey of U.S. mayors, 30% of cities anticipate having to furlough employees, and 27% said they will need to implement layoffs due to budget shortfalls. Even as the historic levels of unemployment inched down in May, nearly 500,000 more government employees lost their jobs last month, the hardest hit of any sector, which had already seen 1 million job losses in April alone.
As public servants, we need to be honest about the fact that reopening our economy alone will not be enough to mount a successful recovery effort, nor will it make up for the millions of dollars in lost revenues over the past several months. A reduction in critical services and layoffs by state and local governments will only slow the U.S. economic recovery, just as it did following the 2008 financial crisis, according to Federal Reserve Chairman Jerome Powell’s recent testimony before Congress.
Three years out, municipalities across our country stand to lose $360 billion in revenues if Congress fails to act now. Thankfully, there are indeed signs that leaders of both parties in Washington are coming together on this critical issue, including numerous legislative packages to provide vital emergency recovery funding to state and local governments. The crisis we face as cities is simply too big to allow politics to get in the way, and Republicans and Democrats alike have a responsibility to deliver a lifeline to the municipalities they represent.
Our cities have been on the front lines responding to the spread of the coronavirus since day one. We did our part and made tremendous sacrifices to ensure the safety of our communities in the thick of the pandemic. It’s time for the federal government to show true fiscal conservatism by making smart investments now to prevent a more dire financial situation in the future.
Matt Pacifico is mayor of Altoona, Pennsylvania, and is president of the Pennsylvania Municipal League.
