News Flash

Emergency Management & Public Health

Posted on: April 3, 2020

CARES Act Information Update

Posted on our Town Crier blog is a Federal CARES Act Update. It provides information on the $150 billion State and Local Stabilization Aid component of the massive $2.2 Trillion CARES Act. These funds can only be used to fund extraordinary costs, caused by COVID-19. These must be costs over and above funding included in each entity’s current operating budget. They cannot be used to cover revenues not collected, as a result of the financial impact of the Coronavirus on taxpayers.

The State of New Jersey is slated to receive $3.444 billion. Of that total, a minimum of $1.894 billion is earmarked for State use. The balance, $1.550 billion, COULD be distributed to ‘qualifying’ local governments. 

But the definition of ‘local government’ in the Act needs clarification. Our partners at the National League of Cities (NLC) have launched an effort to secure CARES Act funding for all COVID-19 impacted municipalities, regardless of size. NLC Executive Director Clarence Anthony has written to U.S. Treasurer Steve Mnuchin requesting a favorable interpretation of the new law.

House Speaker Nancy Pelosi has recognized this, and other problems that need to be addressed, and has opened discussions with the U.S. Treasurer on another COVID-19 response bill.

The Speaker had stated that the next bill should include provisions to help states and municipalities bridge the revenue gaps that will arise due to postponed tax payments and lower collection rates. Since then, attention has turned to a major infrastructure package. There is nothing wrong with that. But the need for funding to cover State and local revenue shortfalls should remain a priority. As you know, New Jersey municipalities collect property taxes on behalf of school districts and counties, as well as for their own local purposes. Only aid provided directly to municipalities of any size can help fill the gaps that all local governments will experience.

Please reach out to Senators Menendez and Booker and your Member of the House of Representatives immediately. We need to insist that stabilization aid be provided directly to MUNICIPALITIES of all sizes. 

Federal Departments and agencies are currently at work, developing procedures for funding distributions, and application advice for provisions subject to an application process. For information on other components of this massive bill, see our March 25 CARES Act Preliminary Snapshot. We will keep you posted. 

Contact: Jon Moran, Senior Legislative Analyst, jmoran@njlm.org, 609-695-3481 x121.


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