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US Cities are getting a windfall from Biden's COVID relief bill. Now how are they going to spend it?

13:25  14 may  2021
13:25  14 may  2021 Source:   usatoday.com

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READ: Full House Democratic Covid relief and minimum wage increase bill . But Democrats argue it ' s easy to defend themselves on legislation that gives people direct checks, access to paid leave, an extension of unemployment insurance and doesn't create new or controversial programs. "My question is why are we including it and burning up time and promising people they will get a minimum wage increase when we know it is not going to happen," one Democratic member told CNN. If the Senate' s parliamentarian allows the provision to remain in the bill , it could force leadership to

Cities and countries, tribes and territories are also in line for money. AZ: This has been one of the big political battlegrounds in every Covid -19 stimulus bill . Republicans have been able to successfully block aid to states and cities in the past, saying they were a handout to high-tax liberal enclaves. AZ: Republicans have been OK with providing temporary support for those directly affected by the coronavirus pandemic. They balk, however, at more money going to the government workforce - and the thought that this could be a back door to a permanent federally mandated family leave programme.

WASHINGTON —  Mayors are accustomed to juggling priorities with limited city revenue: Park upgrades or staff pay increases? Street paving or that long-awaited new community center?

The crunch tightened during a global pandemic.

But an infusion of $350 billion in federal COVID-19 rescue funds now headed to local and state governments this week sets up a new – and welcomed – dilemma: how to spend a financial windfall.

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Two months after President Joe Biden signed his American Rescue Plan into law, the Treasury Department on Monday made available a historic amount of direct aid to thousands of city and county governments. Local governments are in line to collectively receive more than $110 billion over two years in addition to $125 billion for the reopening of public schools. Another $195.3 billion will go to states.

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Biden signs .9 trillion Covid relief bill , clearing way for stimulus checks, vaccine aid. Published Thu, Mar 11 202112:30 PM ESTUpdated Thu, Mar 11 20213:03 PM EST. President Joe Biden signed the .9 trillion coronavirus relief package Thursday afternoon as Washington moves to send fresh aid this month. With his signature, the president checks off his first priority in the White House. He also will give a prime-time address Thursday describing how the country will proceed in fighting the virus a year after the World Health Organization declared it a pandemic.

Unlike Biden ' s initial proposal, neither bill would reinstate mandatory paid family and sick leave approved in a previous Covid relief package. But they continue to provide tax credits to employers who voluntarily choose to offer the benefit through October 1. Last year, Congress guaranteed many While the money provided by the House bill would go to both public and private schools, based on the number of low-income students enrolled, the Senate bill specifically carves out about .75 billion for private schools. The bills are in line with what Biden proposed, but call for more than six times the

a man wearing a suit and tie standing next to a body of water: President Joe Biden takes off his mask before speaking about infrastructure and jobs along the banks of the Calcasieu River near Interstate 10 on May 6, 2021, in Westlake, Louisiana. (Photo by Brendan Smialowski / AFP) (Photo by BRENDAN SMIALOWSKI/AFP via Getty Images) ORG XMIT: 0 ORIG FILE ID: AFP_99F8H2.jpg © BRENDAN SMIALOWSKI, AFP via Getty Images President Joe Biden takes off his mask before speaking about infrastructure and jobs along the banks of the Calcasieu River near Interstate 10 on May 6, 2021, in Westlake, Louisiana. (Photo by Brendan Smialowski / AFP) (Photo by BRENDAN SMIALOWSKI/AFP via Getty Images) ORG XMIT: 0 ORIG FILE ID: AFP_99F8H2.jpg

"For the most part, city budgets are in a survival mode anyway. There's not a lot of money," said Louisville, Ky., Mayor Greg Fischer, whose city lost around 5% to 10% during the pandemic. "So these funds kind of get us back to where we were, which was not resourced as well as we should be. But it's much better than just surviving."

Greg Fischer wearing a suit and tie: Louisville Mayor Greg Fischer speaks during the grand opening of the Nulu Marketplace at the 800 block of E. Market and E. Main streets. April 8, 2021 © Jeff Faughender/Courier Journal Louisville Mayor Greg Fischer speaks during the grand opening of the Nulu Marketplace at the 800 block of E. Market and E. Main streets. April 8, 2021

More: States, cities to receive first chunk of $350 billion in aid this week from COVID stimulus passed in March

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President Joe Biden has moved fast since his January 20 swearing-in, signing a .9 trillion Covid relief bill into law less than two months into his term and issuing more executive orders so far than his three predecessors.

But for now , here are some questions and answers about how payments would work, according to information provided by Democratic staffers who wrote the bill and Treasury staff responsible for implementing it . Why ,400? Biden promised ,000. He did promise ,000 payments — but in the context of raising Then you could probably get a bigger check if you wait to file your tax returns until after they went out. As long as you made less than ,000 in 2019, that is . But don't wait too long, either — the deadline to file tax returns is still April 15. Will it come by direct deposit or paper check?

A year ago, tax revenue collections nosedived in cities as businesses shuttered during state-ordered lockdowns at the start of the pandemic. Many cities cut government workers and programs. The aid is designed to replenish governments with revenue they lost, allowing mayors to hire cops and firefighters or launch capital projects that were halted.

Even though doomsday revenue scenarios initially forecasted didn't materialize, the public sector lost 1.3 million jobs since the start of the pandemic, according to the Treasury Department.

Yet the fiscal situations vary in town and cities across the country. Some mayors say hardships remain, with unemployment still below last year's mark and revenue struggling to catch up. For others, the emergency has largely passed.

"We just got the largest sales tax check in city history last week," said Oklahoma City Mayor David Holt, whose city saw tax collections drop 5% during the pandemic. Holt was among more than 30 Republican mayors who publicly pushed for the COVID relief funds, despite GOP resistance in Washington. Now, sales tax in Oklahoma City is coming in 38% higher than last spring.

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The Biden administration now faces of the challenge of winding down mitigation efforts and convincing reluctant Americans to also get the jab. That will present its own political, and public-health, challenges. But in his first 100 day Biden passed his first, most important test. As with the Covid relief package, Biden is using massive spending bills presented as focusing on popular issues to usher in wide ranging of policy changes that might be more controversial if addressed individually. "Green New Deal" advocates have already called Biden ' s climate spending insufficient, but it still marks one of the most

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"I would have told you two months ago, we're going to spend the money to restore our police and fire budgets. But we don't necessarily have that need now. It's just taken too long for it all to happen," he said. "I can't go back now and fill a police position in June of 2020."

Still, he said Oklahoma City will have a "methodical and thoughtful conversation" on how to make sure the funds have a lasting legacy. "We're going to make good use of it. Maybe now, it's more recovery and less rescue."

Money a year in the works

Most cities haven't finalized how they will spend its funds, and several plan to engage the public before deciding.

The money follows a year-long lobbying effort in Washington by the U.S. Conference of Mayors after the pandemic hit. The federal CARES Act, signed by former President Donald Trump last year, offered relief to only the 38 cities with 500,000 or more people in addition to states.

CARES funds were also limited to expenses "directly related" to COVID-19, not replacing lost revenue. Democrats pushed for direct aid for state and cities in subsequent relief packages but the Republican-controlled Senate opposed it.

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Cities will receive aid from the American Rescue Plan in two tranches – one this year, the second in 12 months. Payments are expected within days after the Treasury Department approves a city's application. Dollar amounts were determined by population and poverty in each community. Money must be spent by the end of 2024.

More: Do states and cities 'need' Biden's $350 billion in direct COVID-19 relief? It depends where you're asking

In Nashville, which relies heavily on tourists drawn to the honky-tonk bars and downtown nightlife, hotel taxes designated to pay off the city's convention center debt fell by two-thirds during the pandemic. Sales tax dropped by around 40%. The city avoided cuts thanks largely to a property tax increase.

"It's very well-received," said Nashville Mayor John Cooper, who referred to the aid as "the Biden money" – $260 million which will go to Nashville over two years. Cooper, a Democrat, said it will be no trouble to find uses in a "growing city with lot of challenges."

He's proposed $20 million from the relief package to boost two affordable housing funds as housing prices skyrocket in Nashville even amid the pandemic. Other priorities include: boosting the city's ongoing public health efforts, repairing emergency vehicle fleets, flood mitigation, and funding homelessness, mental health and small business initiatives. Unlike the CARES Act, public school systems are funded separately in the rescue plan.

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"The nice thing for us is that we can look at the Biden money and not have to worry first about education. They've got their own path to a large amount of funding," Cooper said.

More: Money for colleges, libraries and clubs: 10 things you might not know are in Biden's COVID-19 relief package

Some mayors seek more spending flexibility

The Treasury Department has provided strict guidelines for the funds. Eligible uses include: public health expenditures such as coronavirus mitigation efforts and medical expenses; addressing negative economic impacts, including a reduction of public sector workers or small businesses hurt by the pandemic; replacing lost tax revenue; tackling poverty and offering additional pay for essential workers.

Local and state governments are also authorized to use the money to invest in water and sewer or broadband infrastructure.

More than 250 mayors participated in a Zoom call this week hosted by the U.S. Conference of Mayors, led by Fischer, the group's president, to discuss how they can spend the money.

"We asked everybody on the call, 'Have you all gotten back to your pre-COVID number on employees?' And nobody said they did," said Dayton, Ohio, Mayor Nan Whaley, vice president of the conference of mayors, whose city saw tax collections drop between 8% and 10% during the pandemic. Whaley, who hopes to use funds to pay for new police and firefighter classes that were put off last year, said the relief money can be "transformational" for cities.

Yet mayors on the call – while pleased to receive the money – also raised concerns about the limitations.

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Cities can use funds on targeted relief for communities in low-income census tracts disproportionately hurt by the pandemic, but primarily through health and housing initiatives. Whaley said mayors would also like to be able to use the funds on new community centers, health centers or markets to respond to food deserts in these areas.

"For us, it is really key in these qualified census tracts that we get broader than just housing," Whaley said. "That's not going to cut it for really transformational change for these folks that have really be so economically impacted by Covid. And I think Treasury knows that."

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The Treasury Department has opened a 60-day window to take in feedback from mayors and governors on the funds.

Bryan Burnett, Republican mayor of Rochester Hills, Michigan, a suburb of Detroit, said he hoped to use a portion of the $6.2 million his city will receive on road infrastructure. But roads, bridges and other general infrastructure are not among the acceptable uses unless approved through lost revenue replacement. Biden is pushing approval for a $2.3 trillion jobs plan that include more than $600 billion on transportation infrastructure.

"I don't know if it's because they don't want it to interfere with the president's infrastructure bill that he's asking for now, but for us it would really meet a more significant need," Burnett said. "We're not going to be paying premium back pay. We don't really have broadband issues here."

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David Holt, Bryan Barnett, Eric Garcetti standing in front of a box: Rochester Hills, Mich. Mayor Bryan Barnett, center, speaks as Oklahoma City Mayor David Holt, left, and Los Angeles Mayor Eric Garcetti, right, look on, during a news conference Friday, Sept. 6, 2019, following an Accelerator for America meeting in Oklahoma City. (AP Photo/Sue Ogrocki) © Sue Ogrocki, AP Rochester Hills, Mich. Mayor Bryan Barnett, center, speaks as Oklahoma City Mayor David Holt, left, and Los Angeles Mayor Eric Garcetti, right, look on, during a news conference Friday, Sept. 6, 2019, following an Accelerator for America meeting in Oklahoma City. (AP Photo/Sue Ogrocki)

'Ready to hit the ground running'

White House officials said they included the money for states and cities in the rescue plan because of a lesson learned from the Obama era, when they believe inadequate money for local governments in the 2009 stimulus plan slowed the economic recovery from the Great Recession.

"Personally, we're ready to hit the ground running," said Wade Kapszukiewicz, mayor of Toledo, Ohio, which will receive $181 million over two years. Toledo dipped into reserves last year after income tax dropped 8%.

Kapszukiewicz, a Democrat, anticipates filing an ordinance this summer to appropriate $40 million to $50 million of the $90 million Toledo will get the first year. He's identified six broad categories where money could go toward: budget stabilization, the well-being of city employees, public safety, housing, neighborhoods and economic development.

But because the money is not recurring, he said Toledo will likely use the money to fund one-time capital costs rather than adding new employees. That means sewer work, new police cars or shotspotter technology, he said, rather than new police officers.

"I'd love to be able to hire 100 more police officers in the city of Toledo," Kapszukiewicz said. "But who would want that job? Who would want to be hired on a temporary grant essentially when the money for those 100 positions would run out in two and a half years?"

a group of people standing next to a person in a suit and tie: White House press secretary Jen Psaki, left, and Detroit mayor Mike Duggan, center, listen as Miami mayor Francis Suarez speaks during a press briefing at the White House, Friday, Feb. 12, 2021, in Washington. (AP Photo/Evan Vucci) © Evan Vucci, AP White House press secretary Jen Psaki, left, and Detroit mayor Mike Duggan, center, listen as Miami mayor Francis Suarez speaks during a press briefing at the White House, Friday, Feb. 12, 2021, in Washington. (AP Photo/Evan Vucci)

Miami, which has a population of around 450,000, narrowly missed the threshold to receive relief direct funds under the CARES Act. It's now set to receive $138 million over two years. Last year, the city projected a $25 million deficit, but only ended up with a $2 million shortfall. Florida had laxer Covid guidelines than much of the country, which enabled more businesses to stay open.

Despite a fiscal situation that wasn't as bad as feared, Miami Mayor Francis Suarez said the money is needed, arguing it will help stimulate the economy and help citizens in need.

"We're going to give it to essential workers who have been working hard throughout the pandemic to keep our citizens safe," he said. "We want to shore up our budget to the extent it needs it and then, of course, almost all of it, we're going to give it back to the people.

"Frankly, it's their money."

Reach Joey Garrison on Twitter @joeygarrison.

This article originally appeared on USA TODAY: Cities are getting a windfall from Biden's COVID relief bill. Now how are they going to spend it?

Biden’s old Senate colleagues don’t recognize his current economics. They’re cool with that. .
The White House says there’s no change to his core principles even as he adapts to meet the crises he inherited.In the 1980s, Biden voted for the Reagan tax cuts, significantly reducing the tax rate for high-income earners. In the 1990s, he promoted legislation that would have dramatically restricted deficit spending and backed Clinton-era welfare reform ultimately seen as harmful to working class Black and brown Americans. And as vice president, he negotiated major deals with Republicans that included the extension of the Bush-era tax cuts and domestic spending reductions.

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