Senate Bill Would Double The Amount Of State, Local Aid President Obama Seeks

Three Senate Democrats have introduced new legislation that would provide about twice the financial aid to state and local governments than called for by President Obama to help communities nationwide prevent further cuts in services and avoid more layoffs of firefighters, police officers, and others.

The Local Jobs for America Act would prevent planned cuts and hire back critical public safety, education and service workers who have been laid-off because of tight budgets. The bill comes just days after Obama wrote to congressional leaders urging Congress to approve nearly $50 billion in emergency aid to state and local governments.

Sens. Sherrod Brown (D-Ohio), Al Franken (D-Minn.), and Mark Begich (D-Alaska) unveiled their bill Tuesday as states nationwide brace for a new fiscal year to begin July 1 that promises to continue a pattern of steep budget cuts due to what is being called the steepest decline in state tax receipts on record because of the ongoing poor economy.

A recent analysis finds that states’ fiscal problems will continue into the next fiscal year and likely beyond. Fiscal year 2011 gaps — both those still open and those already addressed — total $112 billion or 17 percent of budgets in 46 states. This total is likely to grow as revenues continue to deteriorate, and may well exceed $180 billion, according to the analysis by the Washington-based Center for Budget and Policy Priorities. States will also face large gaps that could total $120 billion the following year, the think tank adds.

“Cities and municipalities are faced with a terrible dilemma: how to balance budgets while providing critical public services. While we are seeing the economy slowly recover, local communities cannot afford to do without essential services and further job loss threatens the fragile economic progress we’ve made,” Brown says. “Continued unemployment leads to steep declines in revenue and adds to our deficit. The Local Jobs for America Act would help cities and municipalities save or create jobs even as they face budget crises. Recession at the local level is an aftershock of the federal economic crisis that can set back the clock on state and federal economic recovery. This legislation addresses that reality and is aimed at putting people back to work and turning them into tax-payers rather than benefit collectors.”

The Local Jobs for America Act would authorize $75 billion in temporary funds over the next two years to local communities. The legislation would allocate grants directly to eligible local communities and nonprofit community organizations to retain services and create new jobs. It is estimated that the bill would create or save up to a million jobs quickly in both the public and private sectors and help restore access to vital services on which families rely, according to the senators behind the bill.

The legislation would also provide $24 billion to states to help support 300,000 education jobs, put 5,500 law enforcement officers on the beat, and retain, rehire, and hire firefighters. The bill would also fund approximately 50,000 additional private-sector on-the-job training positions to enable workers to acquire core job skills and to help local businesses put people back to work.

“As a former mayor, I understand the critical need to keep our first responders and teachers on the job,” says Begich, who served as mayor of Anchorage before his election to the Senate. “In Alaska, the number of police officers, firefighters and teachers has been reduced in some communities, and I am pleased to support legislation that will provide the means to put more police on the streets, firefighters on the front line, teachers in the classroom, and preserve critical public services these workers provide.”

Since the recession began, an estimated half-million Americans have lost their jobs in local communities because of tight budgets. Brown, Franken and Begich cite estimates from the Economic Policy Institute (EPI) that by 2012, more than 400,000 jobs would have to be restored just to return local government services to pre-recession levels.

Cuts to public jobs also reduce employment significantly in the private sector. EPI estimates that for every 100 public-sector workers laid off, 30 private sector workers are let go because of the reduction in consumer spending in the local economy, the senators add in a statement announcing their legislation.

Last month, EPI found that the total cost of the Local Jobs for America Act would be offset by $39 billion because it would keep taxpayers on payrolls and reduce spending on unemployment and other social safety net benefits.

The Senate bill is matched by companion legislation in the House, introduced by Rep. George Miller (D-Calif.). The House bill has more than 160 cosponsors.

The publisher of the news site On The Hill, Scott Nance has covered Congress and the federal government for more than a decade.

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