State and Municipal Budget Shortfall Threatens Jobs, Infrastructure
Tuesday, August 18, 2020
State and municipal budgets are suffering as a result of decreased tax revenues, and increased expenditures related to public health and employee healthcare and unemployment costs. Due to unemployment, income tax revenue is down, while sales tax and gasoline taxes have also decreased. State governments are paying increasing funds to cover residents’ unemployment, as well as covering Medicaid payments and services for low-income residents. The St. Louis Federal Reserve reports that, since February, 1.2 million local government jobs have been lost. And, according to one estimate, states could face a gap of at least $555 billion.
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