State Treasurers To Congress: Approve The American Rescue Plan With Full Funding For State And Local Aid

As State Treasurers and the guardians of our states’ fiscal health, we urge our Congressional delegations to support the American Rescue Plan with full funding for state and local aid.

The health and economic emergency associated with the coronavirus crisis has taken a severe financial toll on states and municipalities. Tax revenues have plummeted while expenses associated with battling the pandemic have soared. Overall state budget shortfalls are set to​ exceed $500 billion​ over the next two years.

Recovery from COVID-19 will require a focus on both public health and short and long-term investments in economic growth. Unfortunately, under current budget constraints, states and municipalities are forced to spend limited resources to fight the pandemic at the cost of shoring up businesses that are needed to revitalize our local economies.

As long as states and municipalities are forced to underinvest in economic growth to manage the current crisis, economic recovery will be slower than it needs to be. Congress must step up to help states and municipalities invest in rapid economic growth while at the same time finishing the job of immunizing Americans.

The urgent need to invest in our states and municipalities is shared by former ​Federal Reserve Chair and Republican appointee Ben Bernanke,​ and ​Federal Reserve Chair Jerome Powell​ who are among a coalition of bipartisan economists that have endorsed the need for aid to states because every dollar invested pays dividends for the national economy to the tune of ​$1.36 ​in GDP growth.

States and municipalities drive local economic growth through investments in infrastructure, such as bridges, roads, broadband, schools, and other projects that are critical to creating, retaining, and attracting businesses in our communities. By issuing bonds to pay for the construction of this infrastructure, states and municipalities give business to local companies and create good-paying jobs for local workers.

Moreover, our state and local jurisdictions are essential partners to the federal government in the distribution of unemployment relief and vaccines. Budget shortfalls stifle this investment which in turn slows down economic growth. They also lead to lower credit ratings which make borrowing more expensive and further hampers economic recovery.

In addition, these shortfalls have forced layoffs of more than ​1.4 million​ workers, put ​millions more​ jobs at risk, and have led to many states struggling to keep up with the demand for vaccinations, lacking the resources it will take to get the shots in people’s arms needed to control the pandemic.

Despite these strains, it has been nearly a year since Congress approved aid to state and local governments. That’s why we urge Congress to take immediate action by passing President Biden’s American Rescue Plan. It includes $350 billion in state and local aid, which will keep states and municipalities investing in local economic growth while supporting vaccination efforts, and helping to open schools safely.

Congress has the power — and the responsibility — to step in and fill the gap during this emergency. 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. And it’s the only way that Washington can live up to its commitment to the essential workers who have been putting their lives on the line fighting this pandemic since day one, including our heroic health care providers, firefighters, teachers, and law enforcement personnel.

It’s time to put politics aside and work hand in hand to support our communities, keep essential services going, and get our hospitals and health workers what they need to care for the sick.

It’s time for our representatives in Washington to act and pass the American Rescue Plan with full funding for state and local aid.

Sincerely,

Henry E. M. Beck
Maine State Treasurer

Zach Conine
Nevada State Treasurer

Colleen C. Davis
Delaware State Treasurer

Tim Eichenberg
New Mexico State Treasurer

Michael L. Fitzgerald
Iowa State Treasurer

Michael W. Frerichs
Illinois State Treasurer

Sarah A. Godlewski
Wisconsin State Treasurer

Deborah B. Goldberg
Massachusetts State Treasurer

Nancy K. Kopp
Maryland State Treasurer

Fiona Ma
California State Treasurer

Seth Magaziner
Rhode Island State Treasurer

Beth Pearce
Vermont State Treasurer

Michael J. Pellicciotti
Washington State Treasurer

Tobias Read
Oregon State Treasurer

Lynn W. Rogers
Kansas State Treasurer

Shawn T. Wooden
Connecticut State Treasurer

David L. Young
Colorado State Treasurer

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