Mississippi Municipalities
Congress Should Act to Address Long-Term Economic Ramifications of COVID-19
By Cindy Hyde-Smith, U.S. Senator
October 2020 Volume 69 Number 3
We find ourselves this fall in a reality no one could have predicted last spring before the novel coronavirus disrupted every aspect of the lives of every Mississippian in every corner of our state. Months later, there is no predicting the long-term effects of the COVID-19 national health emergency, but we can calculate that action must be taken to offset the economic and social damage to the economies of our nation, our state, and our communities.
The coronavirus pandemic is not only a health emergency. It is also an economic emergency that poses serious consequences for communities, public services, and the citizens who rely on those services.
While attending to the health care aspects of the pandemic, I have continued to focus on how the federal government can best help small businesses, industries, cities, and states withstand the economic losses associated with shutting down a red-hot economy.
I have heard from many Mississippi counties and communities about the fiscal hardships they are experiencing as costs related to COVID-19 consume more of their budgets and as tax revenues decline. To a person, they all want to avoid layoffs, disrupting essential services, or raising taxes.
The CARES Act enacted in late March included some funding for states, but that money included restrictions on its uses and its ability to help individual cities and towns—especially smaller communities. As we looked ahead to the next steps needed to provide economic relief and stimulus, I reached across the aisle to write legislation to responsibly fix those shortcomings and ensure people have access to the services they need.
The State and Municipal Assistance for Recovery and Transition (SMART) Act, which I cosponsored with Senators Bob Menendez (D-N.J.) and Bill Cassidy, M.D. (R-La.). This measure would provide $500 billion targeted to state, local, and tribal governments with flexibility to use the funds to offset the need for significant layoffs, tax hikes, and interruption of essential services. It would also retroactively correct shortcomings in the CARES Act.
I remain hopeful that this measure will influence and be included in any relief package making its way through Congress and to the President’s desk—either now or in the next few months. As I’ve said, the economic consequences of the COVID-19 pandemic will be with us for the foreseeable future.
The SMART Act was written to sidestep partisan pitfalls. We paid careful attention to establishing a distribution formula that would treat each state equally. Our formula is based on population, COVID-19 infection rates, and revenue losses.
I also insisted doing away with population thresholds so direct federal assistance would get to communities and counties regardless of its size. Unlike the CARES Act that excluded every single Mississippi community for individual funding, SMART act eligibility would be open to every city and town in our state.
I think it is also important that the SMART Act was written to avoid becoming entangled in politically charged issues like bailing out fiscally irresponsible states burdened with unrelated debts and pension obligations. The National League of Cities, National Association of Counties, National Governors Association and other organizations support this effort.
As the Senate and House wrangle over how to help cities and states, I am also supporting proposals to simplify loan forgiveness for small businesses that received Paycheck Protection Program (PPP) benefits. We are also considering a follow-up to the PPP program because many small businesses may need continued support as states reopen.
The survival of small businesses is critical not just for the vitality they bring to our communities, but also for their importance to local economies and Mississippi’s overall financial standing.
I pray everyone will remain hopeful and undistracted by political shenanigans this fall. That is my commitment as we, as Americans, work our way through this global pandemic and its effect on our lives. I am confident that, in the end, Congress will act responsibly to provide help to our people, their communities, and states.
U.S. Senator Cindy Hyde-Smith (R-Miss.), a former state legislator and Mississippi Commissioner of Agriculture and Commerce, was elected to the Senate in 2018 and is the first woman to represent the state in Congress.