Columbia faces $20 million revenue shortfall due to coronavirus, mayor tells Congress
Columbia is facing a $20 million shortfall as a result of the coronavirus outbreak and ensuing shutdown of most businesses for several weeks, Mayor Steve Benjamin testified to a congressional committee overseeing the nation’s coronavirus response.
Benjamin said Friday that America’s cities are facing major challenges not only from the public health threat posed by the virus but also by the loss of revenue caused by the economic shutdown implemented to curb its spread.
“Congress must act decisively to provide the necessary funding and support for our nation’s cities,” Benjamin said. “The next bill must include targeted, flexible funding for cities.”
Benjamin was testifying with other mayors before the U.S. House of Representatives’ coronavirus response committee chaired by Rep. Jim Clyburn, D-Columbia. Clyburn introduced Benjamin as “my mayor” and praised Columbia’s proactive response to the outbreak.
Benjamin quickly declared a state of emergency in Columbia in March, and City Council approved a stay-at-home order weeks before a similar order was issued statewide. But the pressure of the outbreak has also led local businesses to shut down and cost many workers their jobs, putting new pressures on public finances.
On Friday, Benjamin asked Congress for more help in keeping municipal services functioning as the country reopens. A former head of the U.S. Conference of Mayors, Benjamin warned that a 10% decline in municipal revenue across the country could lead to a $240 billion fall in cities’ operating budgets, potentially leading to more job losses for municipal employees.
In its current fiscal year, Columbia has an operating budget of $357 million. After the hearing, Benjamin said the city would take a deep dive into its budget to decide how to deal with the expected shortfall.
“We are better prepared for this than any other city I’ve been in contact with, and I’ve talked to scores of mayors,” he said.
The mayor praised a bill passed by the House that would distribute $375 billion in additional funding for local governments. He also asked that the Federal Reserve expand its buyback program for municipal bonds, which currently only offers buybacks to cities with a population of more than 250,000.
“The 250,000 cutoff leaves Columbia and most of the South out in the cold,” Benjamin said. “I fear this will still do damage to the bond market.”
Some members of the committee expressed skepticism about federal dollars supporting local governments’ responses. Rep. Mark Green, R-Tennessee, said his constituents should not have to bail out cities that have previously made poor financial decisions.
“Why should Tennesseans have to bail out Illinois’s bad decisions?” he asked.
But Benjamin testified on Friday that Columbia is required to balance its budget every year and has managed a budget surplus in recent years.
“We’re not talking about money coming from Congress like manna from heaven,” Benjamin said. “This is money our citizens send to Washington every April 15, and in extraordinary times only right that it come back to those citizens.”
Approving more funding “would be the smart thing for Congress to do, because the folks who vote for them are the same people who live in our cities and towns.”
This story was originally published May 29, 2020 at 3:10 PM.
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