(The Center Square) – With governors, public unions, and state lawmakers seeking federal help to shore up their budgets and pay down otherwise routine debt, others are warning against a no-strings-attached bailout.
President Donald Trump signed off on the second COVID-19 relief package Friday, dispersing $484 billion to states, local governments, businesses, and citizens.
“I really believe the states need to have some unencumbered dollars that come in that will help us with the coming year’s budget,” Gov. J.B. Pritzker said. “Every state has this problem.”
But a persistent effort is taking place to pressure Congress in sending states and localities more than that with fewer preconditions.
“Congress must appropriate an additional $500 billion, specifically for states and territories, in direct federal aid that allows for replacement of lost revenue,” said Maryland Gov. Larry Hogan and New York Gov. Andrew Cuomo in their capacity as heads of the National Governors Association. “These continuing losses will force states and territories not only to make drastic cuts to the programs we depend on to provide economic security, educational opportunities, and public safety, but the national economic recovery will be dramatically hampered.”
On a news call, Lee Saunders, president of the American Federation of State, County and Municipal Employees union called the previous $200 billion distributed by Congress a “downpayment,” according to a report from Route Fifty.
The report said public-sector unions are aggressively lobbying for untethered funding for state and local governments.
The partisan divide on the issue centers on whether or not the federal government should bail out states who had been mismanaging their funds before the pandemic.
“State and local governments are going to try to use this as an opportunity to bail them out for bad decisions that were made years and years in advance of COVID-19 ever happening,” said Brian Costin, director of the Illinois chapter of Americans for Prosperity.
Costin added that Illinois has taken few steps to curb spending under its emergency authority.
“Why should [fiscally-responsible states] have to bail out the state of Illinois who’s refused to make tough decisions?”
Illinois Senate Democrats made national headlines last Friday when a letter they sent their congressional delegation asking for more than $7 billion in additional funding went public.