[Congressional Record Volume 166, Number 95 (Wednesday, May 20, 2020)]
[Senate]
[Pages S2521-S2523]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]



                               SMART Act

  Mr. MENENDEZ. Madam President, as our Nation grapples with the COVID-
19 pandemic, our State, county, and municipal governments have been on 
the frontlines taking a leading role in responding to this crisis. As a 
result, they have been squeezed on both sides of the ledger, spending 
billions of dollars in unforeseen costs on emergency response while 
watching as revenues dry up due to necessary stay-at-home orders and 
the closure of non-essential businesses.
  The emergency protective measures have been effective at flattening 
the curve and have no doubt saved thousands of lives, but they also 
came with a cost. All revenue sources are down. Sales tax revenue has 
plummeted with businesses closed. Highway trust funds won't have the 
resources to do basic road maintenance. Downtown parking meters are 
going empty due to people observing social distancing. Building permits 
and municipal court fees have fallen.
  Unless we act soon, we will see mass layoffs, devastating tax 
increases, and a breakdown in public safety and essential services. 
Already, the Bureau of Labor Statistics reported that State and local 
governments laid off 1 million public employees in April. This 
challenge is true for every State, county, city, and town in the 
country.
  The State Municipal Assistance for Response and Transition, or SMART 
Act, is the bold, bipartisan, and commonsense solution we need to give 
our communities a fighting chance and stop the economy from free-
falling. It provides $500 billion in flexible Federal dollars that will 
help our communities dramatically expand the testing capacity and 
contact tracing we need to contain the virus--a necessary step in 
restoring consumer confidence and to restart the economy. It will help 
stave off massive layoffs, tax hikes, and deep, painful cuts to 
essential services. It will keep our police officers, firefighters, 
public health workers, teachers, and other essential employees on the 
job during this critical time, because it is not just about defeating 
COVID-19; we still need to keep our streets safe, our children 
learning, the trash picked up, the roads maintained, and the buses and 
trains running on time.
  I hear some of my colleagues speak from this floor, calling not for 
unity but for division. They callously ignore the pleas for help from 
their fellow Americans, comforted by the selfish but mistaken belief 
that their communities are immune to the fiscal Armageddon facing our 
communities. Let me be clear. When your revenues drop 30 percent 
overnight, it really doesn't matter how fiscally responsible or 
conservative your State budget is; no one can prepare for that.
  Moody's just reported that States like Ohio and Arizona are facing 
the fiscal shock of losing 20 percent of their entire budget, and West 
Virginia, 40 percent. This is not a red State or blue State issue; this 
is a red, white, and blue issue. It is an American priority.
  In December of 1862, during the height of the Civil War, President 
Lincoln wrote the following message to Congress: ``In times like the 
present, men should utter nothing for which they would not willingly be 
responsible through time and eternity.''
  I believe that history will look kindly upon those who stood for 
unity and compromise over demagoguery, those who put the well-being of 
the country over scoring partisan points, those who stuck out their 
necks and took a political risk for no other reason than it was the 
right thing to do.
  I am proud of the bipartisan coalition we have built, and I want to 
thank each of my colleagues for their work and their commitment to 
rebuilding our communities--Senator Cassidy, who has led this effort 
with me, Senator Hyde-Smith; Senator Manchin, Senator Collins, and my 
partner in New Jersey, Senator Booker.
  With that, I turn to my friend from Louisiana, the distinguished 
Senator who exemplifies these qualities and has been an incredible 
partner in crafting this legislation and building this coalition over 
the past month.
  Mr. CASSIDY. Madam President, I thank Senator Menendez and return the 
compliment. We have worked through a lot of issues to find a bill that 
meets a valid, public purpose that can pass on a bipartisan basis in 
both Chambers. I thank Senator Menendez for working with me on that.
  The title of this bill is the ``SMART Act,'' but in retrospect, I 
wish we had renamed it ``the Thin Blue Line Act'' because this is about 
helping cities and States preserve essential services such as police, 
fire, and education for the reopening of our economy.
  Let's just kind of review. The Federal Government asked that State 
and local governments shut down their economy in order to control the 
coronavirus, and just like those small businesses closed at the behest 
of the government authority, so did State and local governments close, 
if you will, at the behest of the Federal authority. But what that did 
is it devastated the tax basis.
  Moody's, which Senator Menendez already alluded to, the independent 
agency that looks at the finances of cities and States, has said that 
if your State is dependent upon income tax, upon sales tax, upon 
tourism, and upon proceeds from energy, you have been hammered. Your 
tax base has fallen dramatically, and with the dramatic fall of that 
tax base comes a dramatic fall in the ability to support the thin blue 
line--the educators, the firefighters, the you name it, the essential 
services that are essential to the reopening of our economy when we 
come out the backside of this epidemic.
  Now, it has already happened. Moody's predicts that 3 million of 
these essential workers will be laid off. I am told that 1 million 
already have been. You can read about universities laying people off, 
but let's go back to the thin blue line.
  The city of Shreveport, LA, just put out a budget in which there is a 
$20

[[Page S2522]]

million hit to their city budget overall, and $3.9 million was, 
unfortunately, laid upon law enforcement and 54 positions eliminated.
  Now, I am told that some Federal dollars came through and allowed the 
restoration of some of those positions, which, if you will, is a proof 
in concept that if there is help from the Federal taxpayer to the State 
and local taxpayer--because they are one in the same--then, these 
essential services can be preserved. And we know that if those police 
positions are preserved, then, that downtown in Shreveport is more 
likely to safely reopen for commerce.
  Now, we talked about Moody's predicting loss of revenue. Louisiana is 
predicted to lose 45 percent of its revenue, but there are other States 
affected. New Jersey, Maine, Florida, Oklahoma, Michigan, Idaho, 
Alaska, Arizona, and Illinois are all predicted to lose large sums of 
tax revenue.
  So let me speak specifically about the SMART Act, or, again, as I 
call it, the ``Thin Blue Line'' bill. It is a reasonable, bipartisan, 
``this is how we go forward'' bill in both Chambers. We picked $500 
billion. Some would say: Well, that is too much. Actually, that was the 
amount of money that Moody's predicts State and local governments will 
lack over the next year and a half. So we actually kind of nail where 
the independent agency puts the need for our State and our local 
government, and it is targeted.
  One, there has been a lot of concern that this would be used to 
``bail out States,'' that those who have accumulated a large, unfunded 
accrued liability in their pension funds would use that money to 
support those pension funds. We specifically do not allow that. So if 
that is somebody's political concern, that has been addressed.
  What do we do? Well, first, a third of the dollars can go out now 
because it is based upon population. This recognizes that if California 
has 31 million people and Wyoming has 500,000, there needs to be some 
accommodation for just the population size because, inevitably, that is 
going to influence the total need.
  The next third will go out at the end of June, based upon how hard a 
State was hit in terms of health from the coronavirus. So if your State 
was slammed from coronavirus--Louisiana was, New Jersey was, and other 
States have been--then, that is where you get the help.
  Frankly, it is unfortunate that you are getting the help. It would be 
a lot better if your State had not been impacted, but if it has been 
impacted, it is there to support your State through the health aspect 
of this crisis.
  The last third will go out at end of this calendar year. That is 
based upon the financial hit that your State has taken. So if your 
State's tax base has been decreased by 45 percent, then, you would get 
additional dollars in the third tranche of money, which comes out at 
the end of the calendar year. Obviously, at the end of this calendar 
year is almost beyond the fiscal year for most States, and so that 
would place the dollars at the State's disposal for the next fiscal 
year. In that way, we cover this prolonged period that Moody's says 
that State and local governments will be out.
  There is one more concern, and that is whether or not all this money 
will go to a Governor's office and none will go to counties or parishes 
or municipalities in Louisiana. One-third of the dollars will go 
directly to municipalities and counties--those local governments that 
are on the forefront of providing services to those who are being 
affected by the coronavirus epidemic.
  We think we have something which balances the needs of stakeholders--
the most important stakeholder being the American citizen--that both 
addresses the need for fiscal accountability and the need to preserve 
those essential government services to get our economy going once more.
  Again, I am going to ask all of my colleagues to support the ``Thin 
Blue Line'' bill, otherwise known as the SMART Act. I think it is a 
smart way to go forward to make sure we don't slip into a recession, 
but we return with as robust an economy from this crisis as when we 
entered the crisis.
  With that, I will yield to my colleague from Maine.
  The PRESIDING OFFICER. The Senator from Maine
  Ms. COLLINS. Madam President, I am pleased to be a cosponsor of the 
SMART Act, and I want to commend Senator Menendez and Senator Cassidy 
for their tremendous leadership. Our bill would help offset the 
collapse of State and local revenues resulting from the COVID-19 
pandemic.
  The coronavirus has already claimed the lives of more than 90,000 
Americans. As the virus damages our health and deprives us of our loved 
ones, it has also devastated our communities and our economy.
  As of last week, nearly 20 percent of Maine's total civilian 
workforce had filed for unemployment. The tourism sector has been 
particularly hard hit, and this is so important to my State. But the 
fact is that no industrial sector has been immune from this disease.
  Restaurants and hotels in southern Maine face uncertainty, not 
knowing when or even if they will ever reopen. As a result of having to 
cancel nonessential surgeries, many hospitals are struggling to stay 
open. Lobstermen and fishermen have lost major markets. Potato farmers 
may be unable to sell more than $22 million worth of their 2019 crop. 
The motor coach industry has been devastated. In short, working 
families and communities across the State of Maine have been hit hard.
  Moody's forecasts that Maine may face one of the worst impacts in the 
entire country in terms of lost revenues. Eighty-five percent of 
Maine's State revenues are from income and sales taxes. They have 
plummeted. Gas tax revenues have tanked. These projected shortfalls 
threaten vital State and local services.
  One in six Mainers is employed in the public sector. These are the 
individuals who keep our communities and our citizens safe: the police 
officers, the firefighters, the EMS personnel. They provide healthcare 
and education. They maintain our roads and our bridges.
  When I visited the Orono Fire Department recently to deliver some 
much needed masks, the town manager told me that the decline in excise 
taxes has been devastating for this town.
  Maine communities tell me that they will have no choice but to either 
increase property taxes, at the worst possible time for working 
families, or eliminate first responder jobs and slash education funding 
if they do not receive help.
  The SMART Act would help to avoid the worst of these consequences by 
providing $500 billion in Federal relief to State, local, and Tribal 
governments. Unlike the CARES Act, where only big cities were eligible 
for assistance, under our bill every county and every community would 
be eligible for funding. Maine would receive at least $2 billion, 
including about $330 million for counties and $330 million for 
communities. And the $1.25 billion that we already appropriated for 
assistance to State governments under the CARES Act would be made much 
more flexible so it could be used to offset these dramatic revenue 
shortfalls.
  The fallout from the coronavirus is unprecedented. Congress has a 
tremendous responsibility to help mitigate the impact of this crisis on 
our States and our local communities and on the families they serve. We 
must not wait. We should act now.
  Thank you.
  The PRESIDING OFFICER. The Senator from New Jersey
  Mr. BOOKER. Madam President, I thank Senators Cassidy and Menendez 
for leading on this extraordinary bill and the broad bipartisan support 
that it has.
  I know Senator Menendez and I have both been mayors in our 
communities, and when there is no crisis, we know intimately the 
challenges that so many of our public servants face. In times when we 
do not see pandemics, our firefighters put their lives on the line, our 
police officers put their lives on the line, and our teachers 
extraordinarily work above and beyond the call of duty. Indeed, our 
communities are strong because of these dedicated public workers.
  At a time of crisis, we see that our teachers are rising to the 
challenge, working to keep their students engaged, even though they are 
now miles apart. I hear stories of teachers riding around, going out to 
visit students, keeping their distance but ensuring that the students 
get the support they need.

[[Page S2523]]

  Our firefighters are out there now, putting their lives even more at 
a risk, putting themselves on the line to help their communities.
  Police officers are answering calls without hesitation, despite the 
great risk that puts on them and their families when they go home.
  So many of our other public servants are working diligently to keep 
our communities running, to keep our States strong to meet a crisis, 
and to try to help folks stay healthy and stay safe. Without 
hesitation, across New Jersey--across all of our 50 States--we are 
seeing more clearly the heroic actions of people who are leading in a 
time of crisis.
  But as was said by my colleagues, across the country, States are 
being hit by significantly declining revenues and extraordinarily 
increasing costs. We are already seeing early projections, as discussed 
by my colleagues. Even independent rating agencies like Moody's are 
talking about hundreds of billions of dollars in deficits for our State 
and local governments.
  My own Governor has estimated New Jersey's protracted gap caused by 
those declining revenues--those extremely rising costs--to be somewhere 
between $20 and $30 billion.
  Due to these shortfalls, without immediate action from Congress, 
State and local governments will be forced to make deep cuts to public 
services, including laying off folks who are not just essential in word 
but who often make the difference between life and death, safety or 
crisis in our communities. These would be the workers who would be laid 
off at a time when we need them the most.
  Not only do we need these vital public servants on the job, 
protecting our communities, educating our kids, and supporting our 
neighbors, but cuts like these actually will aggravate and deepen the 
overall economic crisis facing our country. Independent rating agencies 
and others say that cuts like these will actually prolong our economic 
crisis and the time needed for recovery. This is not the time for half 
measures. This is the time to act at the scale that the crisis demands.
  The Federal Government needs to be providing a robust, accurately 
tailored response to this crisis by funding our State and local 
governments in a way that prioritizes those areas that have been hit 
the hardest. The SMART Act does exactly that. It is a bipartisan bill. 
It is thoughtful. It is tailored narrowly to fit this crisis.
  The SMART Act is a commonsense approach that will make sure that the 
help is going to where it is needed most--to our hardest hit 
communities and States--and to help ensure that those workers whom we 
hail with our words--firefighters, police officers, and teachers--we 
support with our actions, as well, for they are out there right now 
supporting us.
  No State should go bankrupt fighting this virus, because of this 
virus. No State should go bankrupt because we in the Federal Government 
refuse to support them. No essential public worker should lose their 
job because of this crisis and because Congress was not stepping up to 
lead through it.
  There is no time to waste. As was said by my colleague, we have folks 
in my State who are putting together their budgets right now. As we 
heard from my colleague from Louisiana, they are already accounting for 
the need to make cuts. We have already seen hundreds of thousands of 
public workers being laid off. The delay has costs, and when you are 
talking about first responders, the delays can have costs that are hard 
to imagine.
  I encourage my colleagues to see this as what it is. It is an 
accurately tailored response. It is a bipartisan bill. It is what our 
Nation needs right now. I encourage my colleagues in the Senate to work 
to get this to the floor so that we can vote on it, pass it, and get it 
through Congress to the President's desk, so we can avoid the storm 
that we are in and, ultimately, overcome the severity of its ravages
  The PRESIDING OFFICER. The Senator from Georgia.
  Mrs. LOEFFLER. Madam President, I ask unanimous consent to complete 
my remarks before the 12:30 p.m. vote.
  The PRESIDING OFFICER. Without objection, it is so ordered.