Stimulus Talks Break Down, Executive Actions Raise Questions
Talks over the next potential coronavirus relief package have stopped. Whether they will resume at some point or at all remains uncertain. What this means for state and local governments is no additional federal aid on the horizon to deal with budgetary challenges as tax revenues continue to be impacted by the pandemic. This also means fiscal aid provided in previous relief packages are still restricted for use on expenditures related to the pandemic response and not to address lost or foregone revenue.
Over the weekend, President Trump attempted to provide some assistance through executive action in the absence of a legislative agreement. But the administrative actions created more questions and less certainty of providing additional relief. On August 8, the President signed four documents – one executive order and three executive memorandums.
The primary difference between the two types are that executive orders tend to carry more weight and are required to be published in the Federal Register and must cite the authority (i.e. from the Constitution or statute) under which the President is carrying out the action. Regardless of the type, the actions are expected to be challenged in the courts especially since they attempt to change taxes or spending – powers reserved for Congress.
PLEASE NOTE: Implementation of these memoranda and executive orders vary (are NOT immediate) and will require significant guidance from the Treasury, Department of Labor and IRS before required. The Federal Liaison Center is monitoring guidance and development and will notify membership as it is developed.
Here’s a quick rundown of the actions:
It remains uncertain if these actions will be implemented, GFOA urges members to reach out to your Senators during the recess and ask them to meet the House proposal providing for additional funding to help state and local governments address revenue shortfalls as a result of the pandemic. GFOA will continue to report developments as they occur.