Commentary, COVID-19, NC Budget and Tax Center

Why the Republicans’ piecemeal relief plan won’t get the job done for NC

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The Republican COVID-19 relief plan unveiled in Washington earlier this week fails to meet the needs of North Carolina families. Nor does it address our unprecedented state fiscal crisis, which means it will make the recession longer and more painful.

This crisis is bigger than any since the Great Depression, but the Republican’s piecemeal proposal falls well short of the breadth and depth of aid desperately needed across a range of issues.

New research released last week by the Center on Budget and Policy Priorities shows the number of people struggling to get enough to eat has increased dramatically and a huge number of people are falling behind on rent — just as the national moratorium on evictions has expired.

In North Carolina, one out of five renters – 422,000 people – are behind on their payments. Nearly 8% of the workforce is unemployed. And one in five adults living with children —522,000 — reported that their children were not eating enough because of the public health crisis and recession has cut into the family income.

Yet the proposal puts forth woefully inadequate solutions to these problems, despite the fact that the federal government is best positioned to provide bold solutions.

There is no increase in SNAP benefits to help people buy food for themselves and their families, no funding for homelessness services or additional rental vouchers, and substantially less money for laid-off workers, even though high numbers of COVID-19 cases could mean that many people are unlikely to return to work soon.

It also doesn’t include nearly enough aid to state and local governments to prevent layoffs of teachers and public workers and cuts to schools, Medicaid or critical public services. Revenue projections released by the General Assembly’s Fiscal Research Division predicted a loss of nearly 7% in the state fiscal year that ended in June and a nearly 10% loss in the current fiscal year.

With a state constitutional requirement to balance the budget, the reality of limited revenue jeopardizes the state’s investments in K-12 and higher education, public health, transportation and numerous other core structures and services.

And while tens of millions of people are facing serious financial hardship, Black, Latinx, Indigenous and immigrant people have been hit the hardest because of structural racism that creates disparities in education, employment, housing and health care.

For example, an estimated 301,000 North Carolinians were excluded from receiving stimulus checks because they live in a household where at least one family member files taxes using an Individual Tax Identification Number (ITIN) instead of a Social Security number. Nonetheless, the latest proposal by Senate Republicans backs additional stimulus checks while continuing to leave out this community that pays taxes and performs essential work we all depend on.

During the negotiations over a final package, Congress must prioritize support for people hard hit by the crisis. Lawmakers should do this by ensuring these people get the help they need and by working to prevent states, cities, and towns from making deep budget cuts that will hurt tens of millions.

It is imperative that Congress act immediately to negotiate a bipartisan agreement that provides a strong safety net:

  • Provides additional federal funding for Medicaid programs and direct grants to states to protect core public services such as education and transportation, in addition to aid for local governments;
  • Continues expanded unemployment benefits, while supporting businesses and the economy by providing people with a modest income during this challenging time;
  • Temporarily increases SNAP benefits and housing assistance;
  • Creates an emergency fund for states to help people who are falling through the cracks and to create subsidized jobs programs when workers can participate safely; and
  • Advances inclusive policies that acknowledge both the contributions of immigrants and the unique challenges many immigrants face through limited access to public benefits and COVID relief.

This unprecedented crisis, drawn out by poor leadership at the highest level, must be met with unprecedented federal policies that prioritize the needs of people. North Carolina’s U.S. Senators Tillis and Burr must put people first by calling on congressional leaders to do more and pass a better relief package, especially for state and local governments and low-income North Carolinians who have been hit the hardest by the pandemic and are facing the greatest financial hurdles.

Suzy Khachaturyan is a Policy Analyst at the NC Budget & Tax Center, a project of the North Carolina Justice Center.

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