Newtown News of Interest
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Many - But Not All - State & Local Governments Facing Fiscal Consequences of the Pandemic Make Painful Cuts to Spending

Even the most optimistic assumptions about the course of the pandemic point to fiscal consequences for states and local governments that “would be the worst since the Great Depression” and take years to dig out of, Dan White, director of fiscal policy research at Moody’s Analytics, concluded.

 

The squeeze at the state level reverberates in urban, suburban and rural counties in nearly every corner of the United States, and officials are making piercing choices.

 

In Kansas City, Mo., with a municipal budget of $1.7 billion, the city manager has asked each department to draft a plan for cuts of more than 11 percent. That could mean laying off 200 police officers from the 1,300-member force and 180 firefighters and emergency medical technicians, said Dan Fowler, a City Council member.

 

To avoid layoffs, the city is cutting the pay of higher-level employees by 10 percent* and requiring most other employees, including police officers, firefighters and emergency responders, to take 26 unpaid furlough days — one every two weeks — next year. The move amounts to a 10 percent pay cut, and comes on top of six furlough days imposed on the city’s roughly 4,000 employees through the end of this year.

 

State and local employees make up roughly 13 percent of the nation’s work force.

 

Jerome H. Powell, the chair of the Federal Reserve, and many economists have warned that reducing state and local spending will further drag down a weak recovery, as it did after the Great Recession. Spending by state and local governments accounted for about 15 percent of the nation’s economic activity, according to the Bureau of Economic Analysis, part of the Commerce Department.

 

While the federal government can run budget deficits to cover both regular and unexpected expenses, states generally cannot.

johnmacknewtown's insight:

* The Preliminary Newtown 2021 budget provides a 3% increase in salary for all staff members with much higher increases for some managers and directors.

 

Here's what I said at the November 10, 2020, Board of Supervisors meeting:

 

"Today is the 245th B’day of the U.S. Marines! As one Marine veteran resident told me at a Zoom meeting yesterday, Marines have a phrase: 'Officers Eat Last.' That is a sign of 'selfless leadership.' It is why I favor a 3% increase limit for ALL staff, including department heads. It’s the right thing to do, especially during these times when people are being furloughed, laid off, or working for lower wages due to COVID-19."

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Newtown News of Interest
These Scoops are excerpts from articles published in local newspapers and other sources that may be of interest to Newtown area residents. Please click on the "From" link to access the full original article. Any opinions and "insights" appended to these article summaries are solely those of John Mack and do not represent the opinions of any other person or entity.
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