News Flash

Emergency Management & Public Health

Posted on: May 13, 2020

HEROES Act Would Aid All NJ Municipalities

Yesterday in Washington, The Chairs of 12 key House Committees, including New Jersey Congressman Frank Pallone, introduced legislation that would, in addition to several other items, provide substantial, flexible, and assured funding to every municipality and county in our State, both this year and next.

The ‘Health and Economic Recovery Omnibus Emergency Solutions Act’ or ‘The HEROES Act’ (H.R. 6800) would create a $375 billion ‘Coronavirus Local Fiscal Relief Fund.’ Two-thirds of the funding would be appropriated within 30 days of the bill’s enactment. The final third would need to be delivered during the Federal government’s next Fiscal Year, between April 15 and May 3, 2021.

Thirty-five percent (35%) of the funding, or $56.25 billion, would be allocated to Community Development Block Grant (CDBG) entitlement communities. Fifty percent (50%), or $187.5 billion, would be distributed, through the States, to non-entitlement counties. And the remaining 15%, or $56.25 billion, would be distributed, through the States, to all non-entitlement municipalities. States would be required to redistribute funding to all entities, within 30 days of receiving those communities’ guaranteed allotments from the U.S. Treasury.

The funds allocated for entitlement communities would be distributed, based on CDBG formulas. The distribution of funds for non-entitlement municipalities and counties would be based on population.

 According to the bill, municipalities and counties could use Local Relief Funding ‘… to respond to, mitigate, cover costs or replace foregone revenues not projected on January 1, 2020, stemming from the public health emergency, or its negative economic impact …’

If enacted into law, as currently drafted, we estimate the New Jersey non-entitlement municipalities would, in the aggregate, garner a bit more than $1 billion in 2020 and about $500 million in 2021.

Other provisions in the bill include a two-year suspension of the income tax deduction cap on amounts paid for State and Local Taxes – the SALT Cap.

We sincerely appreciate Congressman Pallone’s leadership on this, and his advocacy on our behalf. We urge you all to contact your U.S. House Representative asking them to support the HEROES Act. 

While New Jersey municipalities, large and small, continue to respond to public health, public safety, economic, mental health, and social service impacts of the Covid-19 crisis, they also continue to wait for aid from other levels of government. Local services are now more important than ever. But as emergency expenditures increase, revenues decline. And unless another level of government steps up to help, the same frontline local workers who have been risking their lives to deliver essential services since March will soon be at risk of lay-offs.

We have been advocating for direct and flexible federal aid to all New Jersey municipalities since the first CARES Act was being debated. The citizens of small towns matter just as much as the citizens of big counties. Municipal employees contribute at least as much to society as private-sector workers.

We often hear that the response to the current crisis is to be federally supported, State-managed and locally executed. We desperately need that federal support. We desperately need it now.

Contact: Jon Moran, Senior Legislative Analyst, jmoran@njlm.org, 609-695-3481 x12

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