A bill in the U.S. Senate could provide $500 billion in funds to state, local and tribal governments and remove restrictions on previously passed stimulus funds to help these governments as well.
The State and Municipal Assistance for Recovery and Transition (SMART) Act would provide governments with federal assistance and has bipartisan sponsorship.
SMART Act funds would be used by governments to help prevent layoffs, tax hikes and the interruption of services. The bill would also apply the same flexibility to the relief fund in the Coronavirus Aid, Relief, and Economic Security (CARES) Act that was passed in March by Congress. Mississippi received $1.25 billion in CARES Act funds.
The money would be allocated in three batches, with each state receiving a minimum of $2 billion. One third of the money would be allocated based on population size, another third would be based on the COVID-19 infection rate and the last third would be based on revenue losses. One third of all money provided to a state would be mandated for counties and municipalities.
As passed, the CARES Act has a population threshold of 500,000 for municipal aid not related to direct costs for mitigating the COVID-19 virus. The SMART Act would remove this threshold and allow these monies to be allocated to local governments.
U.S. Sen. Cindy Hyde-Smith, R-Mississippi, is one of the original co-sponsors of the SMART ACT.
The Mississippi Legislature passed a $300 million small business relief plan last week and $950 million of the CARES ACT funds remain unallocated.
Mississippi state tax revenues are more than $244 million under the estimate for the month of April and total year to date revenues are down by $26.3 million.
