State and Municipal Budgets Face Huge Shortfalls

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Bigger Pie Forum | State and Municipal Budgets Face Huge Shortfalls | Ashby Foote
 
Two White Males in Masks Hold-up Mississippi Governor
It was over before you knew it, in mere minutes on Friday, May 1st, two white males in masks with a hundred plus accomplices held up Mississippi’s Governor at the State Capitol in broad daylight. The take was over a billion dollars making it one of the biggest hauls in state history.
The very big bucks in question are courtesy of the CARES (Coronavirus, Aid, Relief and Economic Security) Act to cover expenses from the global pandemic that has gripped the state, the country and the world. The $1.25 billion is Mississippi’s share sent by the feds. The Act imposes three conditions for funds use: 1) Necessary expenditures incurred due to the COVID-19 pandemic. 2) Costs not accounted for in the most recent budget prior to 3/27/20. 3) Costs incurred between March and December 2020. Importantly, the funds are not to be spent to backfill revenue shortfalls. That is the rub. State and municipal budgets face huge shortfalls for the rest of 2020 from a wide variety of normally reliable revenue streams.
Mississippi’s 8,686 COVID-19 cases and 396 deaths as of 5/8/20 are certainly a tragedy for the individuals, their families and friends but the state’s related costs are hard to square with the CARES Act’s conditions.
Boil the CARES Act down and one is left with the inescapable conclusion that this $1.25 billion windfall won’t apply to where Mississippi needs it most.
Some points to consider:
The U.S. Jobs report for the month of April was the worst ever with 20.5 million jobs lost and an unemployment rate of 14.7 percent, up from 4.4 percent a month ago. 16 percent of Mississippians have filed for unemployment. From the economic standpoint, it is not the

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