* From Illinois Municipal League executive director Brad Cole…
Dear Governor Pritzker:
The United States Congress is considering H.R. 748, the Coronavirus Aid, Relief and Economic Security (CARES) Act which is designed to provide more than $2 trillion in aid in response to the coronavirus pandemic.
While the plan, under Title VI, Section 601, provides $150 billion to state and local governments to address spending shortages related to the pandemic, the legislation specifically includes in its definition of “unit of local government” a municipality with a population that exceeds 500,000.
As you are aware, only one municipality within Illinois meets this requisite population threshold. In effect, Congress has turned a blind eye to the economic crisis facing all municipalities and has effectively ignored 1,297 of Illinois’ cities, villages and towns.
This action is a failure on the part of Congress to provide the necessary fiscal resources that all Illinois municipalities need.
The Illinois Municipal League (IML) formally requests any aid received by the state designated for municipal governments be dispersed by your office to all 1,298 cities, villages and towns on a per capita basis so that every community receives the financial help they need to weather this crisis.
OK, first of all, it doesn’t just apply to Chicago as Cole claims. From the bill…
LOCAL GOVERNMENT.—The term ‘unit of local government’ means a county, municipality, town, township, village, parish, borough, or other unit of general government below the State level with a population that exceeds 500,000.
Kane, Will, Lake, DuPage and Cook counties will also qualify under that language.
Even so, that won’t go over well with everyone else.
Secondly, assuming this language survives a House vote, if it’s in federal law there’s not a whole lot a governor can do about it.
* Meanwhile, here’s Hannah Meisel…
Tim Bartik, a senior economist from the Upjohn Institute for Employment Research in Michigan, told The Daily Line that both the limited amount of money for local governments included in the relief package and the lack of flexibility on spending concerned him.
“[Local governments] can spend it on public health stuff you didn’t budget for,” Bartik said. “But if your tax revenue’s collapsed because of economic problems, you can’t use it to keep police, fire or other employees on. You have to use it for additional services you weren’t planning for.”
Those restrictions could create “a really strange situation” where local governments have a surplus to spend on public health, “but not regular activities,” Bartik said.
That could hamper hopes for a “V-shaped recovery,” in which a recession’s shape charted on a graph takes a swift nosedive but also experiences a sharp upturn, Bartik said.
“This essentially is a planned recession; we’re shutting the economy down,” Bartik said of the executive measures many governors, including Pritzker, have taken to shutter non-essential businesses to prevent the spread of Covid-19. “We hope it comes back like a V. But if state and local governments — due to balanced budget requirements — are cutting spending in the fall and [government and consumer] spending plummets, that’s going to have a negative effect on the economy.”