Bankruptcy is Not the Answer for Our State and Local Governments, Vital Federal Support is Critical | Congressman Lee Zeldin

Bankruptcy is Not the Answer for Our State and Local Governments, Vital Federal Support is Critical

April 27, 2020
Press Release
Op-ed by Congressman Lee Zeldin

The fight against coronavirus is unlike any battle our county, state and country have ever faced. Our entire way of life flipped on its head seemingly overnight because of a pandemic that swept the globe. That’s why it's critical we rise to meet this challenge not as Republicans, not as Democrats, but as Americans in a non-partisan manner to deliver for those who need it most. 

In Suffolk County, everyone in and out of government didn’t just talk the talk, we walked the walk, working to deliver the resources our brave health care and other front line workers need to fight coronavirus on the ground in our communities. In just the last month alone, working with everyone and anyone from the White House to Suffolk County Executive Steve Bellone, I’ve worked together with these partners to deliver over 1.2 million pieces of Personal Protective Equipment, including surgical masks, N95s masks, face coverings, gowns, and more. 

Our health care workers are putting their health and safety on the line and have earned nothing less than everything they need to do their jobs safely and effectively. When it comes to allocating federal funding for these hospitals and health care facilities, we must drive appropriated funding to the hardest hit medical providers, like those in New York, and better factor in revenue losses and COVID-19 expenses when further deciding on funding formulas. Following my direct advocacy to the Department of Health and Human Services (HHS), the Secretary of HHS started driving CARES Act funding specifically to our hard-hit hospitals.,

In addition to funding for our local hospitals, Suffolk County received $257 million in federal funding for coronavirus related expenses. As one of the country’s hotspots, this will go a long way in alleviating costs for local government, but there’s more we can do to drive desperately needed funding to our communities. This includes adding flexibility on how this funding is spent in order to help county government best survive this pandemic. Funding also should be driven directly to smaller local governments as well.

Currently, Federal Emergency Management Agency (FEMA) Disaster Aid is 75% federally funded and requires a 25% non-federal contribution. This unprecedented time must be matched by an unprecedented commitment from the federal government, and it must cover 100% of FEMA Disaster Aid. At a time when our local resources are at a breaking point, the federal government must continue stepping up to the plate. 

That’s why I'm also advocating for the Department of Treasury and Federal Reserve to expand access to what is called the Municipal Liquidity Facility. The Municipal Liquidity Facility helps states and localities deal with budgetary stresses caused by the ongoing outbreak of coronavirus, by allowing the federal government to purchase up to $500 billion in short-term notes for these localities. This injection of $500 billion allows states and localities to continue to finance the delivery of essential services for their residents despite current budgetary shortfalls. Currently, a county must have over two million residents to qualify for the Municipal Liquidity Facility, and with Suffolk County’s population currently estimated at 1.5 million, I’m urging the federal government to lower this requirement to over one million residents so Suffolk County can utilize this support. 

Additionally, as Congress negotiates additional coronavirus response legislation, it’s important to very strongly consider that our states and local governments hardest hit - like we have experienced in the worst way in New York - are desperate for additional federal resources to finish the battle against coronavirus. Bankruptcy is not the answer. Federal support is critical in this effort.

Every level of government has continued to work together to deliver for Suffolk County, and we’re not slowing down. Ensuring we continue to partner in a non-partisan manner will ensure we emerge stronger than ever on the other side of this battle. 

Congressman Lee Zeldin represents New York’s First Congressional District in the U.S. House of Representatives where he serves as a member of the bipartisan Congressional Coronavirus Task Force and the White House’s Opening up America Again Congressional Group.