The next round of national legislation dealing with the effects of the ongoing COVID-19 pandemic may include provisions that will benefit state and local governments, U.S. Sen. Charles Grassley said in Clarinda July 15.
Meeting with a group of municipal and county officials from Clarinda and Shenandoah at the Lied Public Library, Grassley said members of Congress will attempt to complete work on a stimulus bill so it can be sent to President Trump by Aug. 6.
The amount, Grassley said, “would probably be within $1 trillion or less.”
This past spring, as cases of coronavirus surged and states imposed lockdowns to combat the spread of the disease, Congress passed the CARES Act and other measures for a total outlay of about $3 trillion.
States received allocations that were utilized to respond to the health care emergency. Iowa’s portion was about $1.2 billion, but “none of it was required to be filtered down to cities and towns,” Grassley said.
Clarinda Mayor Lisa Hull noted that CARES Act funds were disbursed through the Iowa Economic Development Authority to small businesses in the state.
For the next stimulus bill, Grassley said, “if money in the states is not needed for COVID-19, then I think the first step would be to give the states more flexibility to use that money for whatever they want to use it for.”
That could mean allowing the funds to be forwarded to cities and counties within the states, either directly or through another public entity.
Deciding how portions of the funding appropriated as part of the response to the virus “can be diverted to something else,” Grassley said, is an issue that Congress needs to address as it formulates the next stimulus measure.
Financial aid from federal sources will help cities and counties contend with a reduction in revenue that has occurred in the wake of the pandemic.
Page County Supervisor Alan Armstrong said the county expected to see lower revenue from the road use tax fund, since less driving was reported during the spring months after the virus cases increased. A drop in the number of people traveling caused a reduction in receipts from hotel-motel taxes as well.
Because many businesses were shut down for a prolonged period, less revenue was generated from the local option sales tax, said Clarinda City Manager Gary McClarnon and Shenandoah Mayor Richard Hunt.
Also discussed during the July 15 meeting was the topic of students starting classes for the 2020-2021 year.
Grassley said he was glad that President Trump “is promoting it, but he kind of leaves the impression that he is going to force everyone back to school. It’s not his decision.”
Instead, Grassley said, the president “ought to say, ‘I’m going to encourage schools to open up, and we’re going to do everything we can to help them open up.’ But he’s got to realize that Clarinda is going to have a different decision than Des Moines. In Iowa, with 330 school districts, you’re going to have 330 different ways of doing it.”
The resumption of classes, after schools were closed during the spring, is linked to “opening up the economy,” Grassley said, “because when kids are home, there are a lot of people who don’t go to work,” even though many of them may want to do so.
He noted that “kids need socializing with their friends. If they don’t get that, it’s harmful to them. That’s another reason to open [schools] up.”
But he added: “I think the final judgment has to be what is safe and isn’t safe. And when things turn less safe, what do you do about it? That’s where you’re going to have every superintendent with a different answer.”
Revised guidelines from the Centers for Disease Control are scheduled to be released, offering more comprehensive information about how schools can open safely.
Commenting on another subject, Grassley said tax credits for such alternative energy sources as wind power and solar power are due to expire in 2021.
Those tax breaks, he said, were adopted decades ago when there was a concern that the United States might have to rely on foreign sources, such as oil from other countries, to meet its energy needs.
“So every tax incentive we could give to every alternative energy, we did it, because we didn’t want to be importing all of our energy,” Grassley said.
Now that the nation has become less dependent on outside sources, he said, there is no longer an urgency to subsidize certain sectors of the energy industry.