When the pandemic first struck in early 2020, it sent shockwaves through the world of state and local finance. Since then, budgets in most places have stabilized following massive infusions of federal relief dollars to states and localities directly and to American households. At the same time, certain key state and local revenue streams never dried up as badly as many first anticipated.
Brendan Hanlon, chief financial officer for the city and county of Denver, recalled how the government there entered into the pandemic with a $1.5 billion general fund budget and then lost around $200 million in 2020. One way Denver closed the gap was cutting labor costs, leaving open jobs vacant and offering retirement incentives.
Elizabeth Reich, chief financial officer for Dallas, noted that the city has received hundreds of millions of dollars in federal aid over the course of the pandemic—its direct ARPA aid alone totals $355 million and an earlier CARES Act allotment was around $234 million. “It helped us manage through the last two years,” she said.
“But money alone doesn’t cut it. And more important is how you invest that money,” Reich added. She explained how Dallas focused its earlier pandemic spending using CARES Act dollars on immediate needs like testing, vaccinations, protective equipment for workers, rental aid, shelter for the homeless and small business assistance.
