Consider This from NPR - Congress Is Sending Relief But Many Cities And States Didn't Get What They Wanted

Episode Date: December 30, 2020

While it took time for congress and President Trump to agree on the $900 billion pandemic relief bill, one thing has been certain for a while. Many mayors and governors did not get the money they requested. Tracy Gordon, a senior fellow at the Urban-Brookings Tax Policy Center, explains that while states will get funding for things like public education and vaccine distribution, what mayors and governors really want are unrestricted funds to spend how they'd like. NPR's Ailsa Chang reports on how public transit has been hit especially hard during the pandemic. And scaled-back services, while saving some money, hurt passengers who rely on them. Learn more about sponsor message choices: podcastchoices.com/adchoicesNPR Privacy Policy

Well, it took a while, but after some last-minute hesitation, President Trump signed the latest pandemic relief bill into law on Sunday. President Trump suddenly signed a coronavirus relief bill that he threatened to derail just last week. The $900 billion package has unemployment funding, money for vaccine distribution, and $600 paid out to most Americans. One reason Trump held off is that he wanted those direct payments to be $2,000. As of 3 p.m. Wednesday, it's unclear if that'll happen as part of a separate package. Regardless of how that all shakes out, one thing has been clear for weeks. The bill does not have

the funding that many mayors and governors wanted. This is a major problem. It's also a major disgrace. New York Governor Andrew Cuomo, a Democrat, vented at a press conference two weeks ago as the details of the bill were taking shape. He joined a chorus of governors who say Congress has shortchanged them. Money from the last relief package

has mostly run out for states. Tax revenues are way down. And because most states are required to balance their budgets, there may be deep cuts ahead. We have been talking about this for months, since before the election. And then after the election, people were supposed to put their politics aside and actually do their job. Apparently that hasn't happened. Consider this. Facing massive budget shortfalls, mayors and governors all over the country are making tough decisions. Decisions that could hurt the most vulnerable in our society.

From NPR, I'm Ari Shapiro. It's Wednesday, December 30th. This message comes from WISE, the app for doing things in other currencies. Send, spend, or receive money internationally, and always get the real-time mid-market exchange rate with no hidden fees. Download the WISE app today, or visit WISE.com. T's and C's apply. At Planet Money, we are also grappling with what's going on in the world. We just don't know, and you're still going to have to decide. So we call up economists like Emily Oster. It's like we're fighting the pandemic by having a bake sale or something. I mean, all due respect to bake sales.

Listen and subscribe to Planet Money from NPR. It's Consider This from NPR. For a while in the summer, the economy was bouncing back, and that meant revenues for state and local governments were bouncing back too. But since then, with rising coronavirus cases and more lockdowns, things aren't looking so great. There are some troubling signs in terms of personal income, personal consumption, dipping that have, you know, local leaders really bracing for an economy that's going to be moving sideways for a while. Tracy Gordon is a senior fellow at the

Urban Brookings Tax Policy Center. And she told me that while the relief funding from Congress does mean money for K through 12 schools, hospitals and vaccination campaigns, what mayors and governors really wanted was unrestricted funds to spend how they'd like. Which was part of the initial package in March, although not as much as they had asked for. And that's really what economists have found delivers the biggest bang for the buck. Now, if Congress doesn't step in with more aid in the new year, and state and city governments have to cut spending, that'll most likely mean laying off some government employees, from teachers to trash collectors. It's an open question as to, you know, how much longer state

and local governments are going to have to muddle through and how much more assistance the federal government is going to provide. It seems like some of these programs that are likely to be cut are the exact things that are most crucial right now, whether we're talking about housing or hunger or education. Right, as always happens in recessions, and especially in this recession, which has really disproportionately affected people at the bottom. So one of the reasons that states in particular, some states, are seeing their revenues not fall by as much as they had thought they would is because this recession has largely spared people at the top of the income distribution. The stock market is doing great, but people at the bottom are losing their jobs, are relying more on public programs. And state and local governments

are on the front lines of providing safety net programs, and they will be left holding the bag if there are more people who need those programs. Tracy Gordon, she's a senior fellow at the Urban Brookings Tax Policy Center. All right, let's take a look at one place you can see the tough decisions that local governments are making right now. Public transit has taken a major hit in the pandemic. First off, bus and subway ridership is way down across the country, which means millions of dollars in operating losses. But when these systems cut back on services to save money, it hurts passengers who rely on them. It is still dark. It's just turning light when I get off work. Judith Howell is an overnight security officer in Washington, D.C.,

and she has to get to her job on time, 11 p.m. sharp. Whether you're a commercial cleaner, a home care health worker, or a restaurant worker, you don't get a lot of leeway for being late. During the pandemic, D.C. Metro cut service on her bus route. So Howell's relied on neighbors to give her a ride to work. Sometimes she splurges on an Uber. Because unlike a lot of white-collar jobs, where you can work from home in your sweatpants, Howell has to show up. The majority of people in this country are working-class and middle-class people.

And that's who the system should be designed for. Howell spoke with my colleague Elsa Chang, who has been reporting on the future of public transit as states and cities scramble to find funding. Even though across these public transit systems, ridership is down, among essential workers like Howell, ridership is similar to what it was before the pandemic. And many of these riders tend to be lower income and people of color, like Myra, who lives in the Boston area. My community that doesn't have the luxury to work from home, that are in the front lines, working jobs that depend on our physical labor. We're not going to use Mayra's last name because of her immigration status. Every day she rides buses and trains to get to three different restaurant jobs in three different cities.

And I don't really have another option because I don't have a car. I can't drive. And then during the pandemic, Mayra saw bus routes getting cut. She saw buses on the remaining routes making fewer stops. And that meant at least an extra hour for her daily work commute. So she's even thinking she might have to quit her third job. Myra and other riders have been worried that some of the temporary service cuts they saw during the pandemic might become permanent if these agencies don't get more relief money. It is full steam ahead for the MTA's doomsday budget. Has left the already cash-strapped agency in crisis. Metro is proposing sweeping cuts to service.

Shepta is making more cuts as it loses money. Bart just announced it's asking for another half a billion dollars. The MTA says they must reduce services where there are fewer riders. The MTA says it could be forced to reduce service on subways and buses by up to 40%. This past fall, the Metropolitan Transit Authority in New York proposed to cut service by up to 40% on subways and buses and lay off 10,000 transit workers. Pat Foy is the chairman and CEO. It is so bad also that it is worse than during the Great Depression in terms of the downward effect on ridership and our revenues. From September 1929, the month before the stock market crashed, to 1933, subway ridership

was down 13 percent. In the worst days of the pandemic in New York in March and April, subway ridership was down 95 percent. And even now, although it's greatly recovered, it's down 70 percent. That matters because we get half of our revenue from our customers in tolls and fares. So you can imagine the financial damage it's caused. Now, Congress has just passed another coronavirus relief package, and that legislation does include $14 billion for transit agencies, which does stave off some of the most drastic transit cuts in places like D.C., Boston and New York. That will fill our deficit in 2021 and put us in a position in 2021, at least, we will not have to make those types of service cuts or lay off colleagues. OK, so what kinds of service cuts may still be in place even after this stimulus money gets to the MTA? We will need an additional $8 billion of federal aid for 22, 23, and 24.

Having said that, in 2021, we will be running reduced service on Metro North, and we'll be looking at service on subways and buses as well. We're just right-sizing the service for the levels of ridership that we have. So, Foy says, the $4 billion the MTA will get in this latest coronavirus relief package will help in the short term, but it doesn't solve the long-term transit crisis. As I listened to Foy talk, it felt like I had heard this story before, way before the pandemic. This story about chronically underfunded public transit systems. And it made me wonder, why is the story always like this? So I got on a Zoom call with Jona Fremark.

He's a senior research associate at the Urban Institute. And when we got on, I glanced at the wall behind his head, and he had all these transit maps. And then this map up here is an imagined map of a transit system for the Game of Thrones. They go into battle on subway cars. That's right. The question I wanted Fremark to answer was, why are transit agencies always struggling? One of the problems we have is that we're very focused on maintaining the status quo. Everything about the investments we make in our transportation system are ensuring that people can continue to get around in the same ways that they did 10 years ago.

And so for the most part, the transit options we've been giving people have been very similar year in, year out. And many of the support programs that have been announced during the COVID crisis have been about maintaining that status quo. Like they're just Band-Aids. Yes, absolutely. They are complete Band-Aids for a transit system that is inadequate for most people around the country. We speak a lot about transit in places like New York or Washington because those are the places where transit is relatively high quality. But the reality is that there are low-income Americans all over the country who are in desperate need of an alternative to driving around, but who simply don't have access to good transit options. Do you feel like during this moment, this pandemic, lawmakers in Washington are paying more attention to what public transit needs? The Congress in 2020 demonstrated that there is bipartisan interest in supporting public transit. What we really saw this year was an endorsement of the idea that public transit is an? Because I could imagine that there is also a lot of people out there thinking, wait, I'm stuck at home right now. I'm not going to be going anywhere. Don't put money into public transit. Put money into unemployment, into food stamps. this year we saw a major endorsement of increased funding for transit in communities where you might not expect it. Places like San Antonio, Texas, Austin, Texas, San Francisco region, city of

Seattle. In all those places, voters actually passed new referenda that will increase their own taxes to pay for transit. This was really surprising because, as you said, we're in the middle of an economic recession. People have lost their jobs. And yet they said, for us, public transit is an important enough priority that we're willing to increase our own taxes to pay for improvements. And Fremark says if more and more voters keep voicing support like this for public transit, he hopes eventually lawmakers actually will allocate more than just a Band-Aid. That's Elsa Chang. You're listening to Consider This from NPR. I'm Ari Shapiro.