Congress yesterday passed the Paycheck Protection Program and Health Care Enhancement Act, also known as the “COVID-19 3.5” relief package.
The bill includes aid for small businesses, hospitals, and money to expand testing. The Senate passed the measure earlier this week and it now goes to the president, who has indicated that he will sign it.
Despite a bipartisan push to include much-needed aid for state and local governments, President Trump, U.S. Senate Majority Leader Mitch McConnell, and Treasury Secretary Steven Mnuchin said that relief for state and local governments will have to wait until the next round of federal aid.
Counties are making significant financial investments to address immediate public health and safety needs. At the same time, counties are experiencing massive and unprecedented declines in revenue as a result of the coronavirus pandemic.
The combined effect of these changes will likely undermine county revenue structures and support for education, public safety, roadway maintenance, and other essential services.
According to the National Association of Counties (NACo):
This package is a good step toward supporting counties’ vast health, safety and economic recovery responsibilities, many of which are mandated by states and the federal government, but we need more resources as we address this unprecedented pandemic.
As previously reported on Conduit Street, according to NACo, the COVID-19 pandemic has the potential to impact county budgets by over $144 billion through fiscal 2021. An additional $54 billion in property tax revenue is at risk in states where counties have not yet collected any or all property tax revenue.
The “COVID-19 3.5” package allocates another $310 billion into a key loan program designed to keep employees on small company payrolls. The measure provides $60 billion for small lenders as part of the small business aid program, $60 billion toward Small Business Administration disaster assistance loans and grants, $75 billion in hospital relief, and $25 billion for coronavirus testing.