Senate Proposal Short on Help for Local Governments

HEALS Act offers flexibility for funds already allocated, but no new fiscal relief to address revenue shortfalls

Jul 27, 2020 | ARTICLE

The Senate's HEALS Act, a framework for a new stimulus package, has no new fiscal aid to help local and state governments address their revenue shortfalls. It provides flexibility for local governments to spend CARES Act funds beyond the December 30, 2020, deadline.  It also would expand allowable uses of CARES Act funds, including some for lost revenues. The proposal includes $16 billion for testing, $15 billion for child care, and some investments in the 2020 Census.

There are significant differences between the HEROES Act, passed by the House in May, and the proposed HEALS Act  And there is no consensus among Senate Republicans on what exactly should be included in a final stimulus package.  

Cities and counties are experiencing significant revenue shortfalls, according to preliminary findings from ICMA's July survey. While most local governments anticipate revenue shortfalls of up to 10 percent, a significant number project even greater shortfalls, including in excess of 20 percent.

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