KC might be too small for direct federal coronavirus aid, but Jackson County isn’t
Congress may have shortchanged Kansas City, but it greatly expanded the role of Jackson and Johnson counties in distributing the region’s share of the $2 trillion federal stimulus.
The package passed last week sets up a $150 billion relief fund to help cover the rapidly escalating costs state and local governments face in responding to the COVID-19 pandemic.
Each state is guaranteed a minimum of $1.25 billion, but many will receive more based on overall population. It will be up to the governors to distribute the money to local governments based on their coronavirus-related expenses.
As cities experience a massive loss in sales tax revenue from business closures, they also confront steep costs for supplies and staff hours during the crisis. Getting the aid quickly could save lives, while delays could be deadly.
The law allows local governments in communities over 500,000 to obtain aid directly through the U.S. Treasury Department, a provision meant to help big cities bypass delays at the state level.
Kansas City, however, fell just short of that measure, as estimated in 2018 by the U.S. Census Bureau, which pegged the city’s population at just under 492,000. Other cities in the region, St. Louis and Wichita, are even further below the threshold.
But Jackson County with an estimated population of 700,000 clears the population threshold easily, which means it could be up to Jackson County Executive Frank White rather than Kansas City Mayor Quinton Lucas to take the lead in obtaining the stimulus money and deciding how it’s spent.
Lucas contends that Kansas City should be be eligible for direct control of the aid because the city will surpass the 500,000 mark in the 2020 Census based on the city’s estimates. The state’s congressional delegation is pleading the city’s case to the Treasury Department, which is set to distribute the money this month.
“This crisis has shown that Missouri’s largest cities—Kansas City and St. Louis—have consistently led our state in recognizing the seriousness of coronavirus and the need to take bold actions to keep Missourians and our neighbors safe,” Lucas said in an email, which argued the city should be eligible for direct aid on its own.
But if the Treasury Department relies on either 2010 Census results or the 2018 estimates, only two jurisdictions in the state will clear the threshold for direct aid. In addition to Jackson County, St. Louis County with a population of nearly 1 million will be eligible to distribute the cash rather than waiting on Missouri Gov. Mike Parson to act.
The same is true of Johnson County, Kansas, which will be able to obtain funds immediately rather than relying on Gov. Laura Kelly.
It’s a dynamic that potentially empowers county officials at the expense of city leaders.
White’s chief of staff, Caleb Clifford, said that the county plans on using the aid to expand its COVID-19 testing capacity, increase contact tracing by the health department and shore up resources for Truman Medical Center in Kansas City.
“We have to rely upon the experts on this field of public health to tell us what they need… and they’ve been saying from the beginning to the greatest extent possible we need to increase testing,” Clifford said.
Clifford said serving Kansas City’s urban core will be one of the county’s priorities with its aid, but it’ll also be ensuring the rest of the county’s needs are taken care of as it spends the relief funds.
“We want to do everything we can to maximize the community’s benefit,” Clifford said. “TMC serves the entirety of Jackson County.”
Pleading the city’s case for direct aid
Lucas has been outspoken in his criticism of the 500,000 person threshold, which could exclude Kansas City and of other large cities, including Miami, Raleigh and Atlanta, from receiving direct aid.
“I think anybody who looks at a map of the United States will realize that in almost any state the largest city is under the threshold,” Lucas said in a phone call.
Lucas argued that Kansas City will surpass the 500,000 threshold in the 2020 Census based on the City Planning and Development Department’s projections, which place the population at more than 505,000.
But if the Treasury Department relies on the 2010 Census or the 2018 estimates, the city will fall short. Rep. Emanuel Cleaver, D-Missouri, a former mayor, wrote a letter Wednesday to Treasury Secretary Steve Mnuchin to use the city’s 2020 estimates instead to ensure a quick distribution of aid.
“I think that this is going to be a call that the secretary can make. It’s not going to go back through the legislative process. This is something that Secretary Mnuchin can do... and I think he probably wants to do the right thing,” Cleaver said.
Lucas said that the city’s top priorities if it’s able to obtain the direct aid will be to ensure hospitals have needed resources, that there is safe housing for homeless and displaced individuals during the crisis and that emergency workers have needed personal protective equipment.
“So I’m not hearing calls from Kansas City firefighters about how they need to reuse PPE for weeks,” Lucas said, contending that requiring the city to go through the state will slow down the process during a crisis that has escalated on a daily basis.
Cleaver agreed that requiring the city to go through the state would undermine Congress’ intent for a quick distribution of aid.
“When I spoke to the governor a few days ago I started telling him I knew he was already under water… and he said yeah,” he said
Asked about Parson’s plan for distributing aid to cities, the governor’s spokeswoman Kelli Jones said the state was still waiting on federal guidelines.
“Once we have additional guidance on the parameters of this funding, we will be able to provide further information to our localities,” she said.
Designed with New York City in mind
Senate Republicans had initially wanted all of the aid to go directly to state governments to distribute, but Senate Minority Leader Chuck Schumer, D-New York, pushed for allowing communities over 500,000 to obtain aid directly as a way to enable New York City to get relief funds faster, according to a Senate Republican aide.
Schumer presented it as a “take it or leave it” condition for passing the bill during the final 36 hours of negotiations, the aide said. Schumer’s office did not respond to a request for comment.
Sen. Josh Hawley, R-Missouri, said in a statement that he was unhappy with the provision and had wanted it changed. “My view is cities and towns in our state should get the same treatment New York City does,” Hawley said.
But Hawley said he also trusted Parson to fairly distribute the state aid.
The bill requires the Treasury Department to distribute the aid to state and local governments over the population within 30 days of the bill’s enactment. President Donald Trump signed the legislation Friday. It doesn’t specify a timeline for governors to distribute aid to local governments.
By the time the bill got to the House amending it wasn’t an option because of the urgency to pass relief agency, Cleaver said. Cleaver said if Mnuchin rebuffs his request to treat Kansas City as a city over 500,000, then he will turn his attention to making sure the county can play the lead role in getting direct aid to the region.
Lucas said he had not spoken with White, the Jackson County Executive, about the issue. He said he expects the county will want to prioritize its own expenses.
Clifford said Jackson County shares Lucas’ concerns about the provision and also wants to make sure that the state will not use the direct aid going to the county as an excuse for short-changing the municipalities within the county
“We want to make sure as this move forward that jurisdictions such as Kansas City, Independence or Lee’s Summit aren’t penalized because Jackson County is getting aid,” Clifford said.
Lucas said he spoke to White for 20 minutes on Monday but the topic of direct aid to the county and its potential impact on the city did not come up. “I don’t know if the county is actually concerned,” Lucas said.
Clifford said the county is still waiting on the department to issue guidelines, which will help clarify how much aid the county can get and what it can do with it. He said without guidelines from the Treasury Department the county is unsure the language in the law will allow it to distribute the aid to cities within its borders.
Michael Leachman, the senior director of state fiscal research at the Washington-based Center on Budget and Policy Priorities, said he doesn’t see anything in the bill that would restrict the county from distributing aid to the city.
“I don’t see any restrictions on their ability to share that money,” Leachman said. “If the county’s worried that the city will be penalized by the governor, then the county needs to talk to the governor. It’s not like there’s language in the bill that addresses that.”
An analysis by the Center on Budget and Policy Priorities, a liberal-leaning think tank, estimates that Missouri will receive $2.38 billion in federal aid from the federal government based on its population.
Roughly $296 million will be available to the local governments for communities above the 500,000 threshold, according to the center’s analysis.
More than half of that would likely go to St. Louis County, which has nearly 1 million people compared to Jackson County’s roughly 700,000 in the 2018 estimates.
Leachman said the center relied on the 2018 estimates rather than the 2010 Census numbers because the bill refers to the most recent data from the U.S. Census Bureau.
Kansas counties
Two counties in Kansas surpass the 500,000 person threshold based on the 2018 estimates: Johnson County with more than 590,000 people and Sedgwick County with more than 510,000 people.
The two counties stand to receive a combined $216 million of Kansas’ total 1.25 billion, according to the center’s analysis.
Scott Neufeld, Johnson County’s budget director, said in an email that a separate analysis by the Washington-based Tax Foundation calculates that Johnson County stands to receive roughly $116 million from the stimulus.
Based on his early reading of the bill, he said he believes the county will have the power to shift money to Overland Park, Olathe and other cities in the county as needed.
“We need to fully analyze the guidelines, but preliminarily it appears that the monies are for increased expenses incurred as a result of the COVID-19 pandemic, so we would utilize the funds for those related expenses,” Neufeld said in an email.
Sedgwick County Commission Chairman Pete Meitzner said the county would be looking into whether it qualifies for direct aid.
The county was less than 2,000 people shy of the 500,000 threshold in the 2010 Census, but will make it if the Treasury Department relies on the 2018 data.
“If there’s availability for us to accomplish that based on the 500,000, absolutely we will be doing that,” Meitzner said.
Wichita, Kansas’ biggest city, will fall short of the threshold, but Wichita City Manager Bob Layton said he was not concerned about the issue because of the city’s collaboration with Kelly’s office and Sedgwick County.
“I’m confident that cities will be compensated as much as possible,” Layton said. “We’ve already reached out to the governor’s office.”
The bill restricts the aid to expenses incurred as a result of the coronavirus epidemic.
The Senate GOP aide said communities could use it to purchase protective equipment for health care workers and pay overtime hours of public employees, but argued that the aid was not to be used to make up for revenue losses.
“It’s explicitly written in there that it can’t be something that was contemplated in your budget,” the Senate Republican aide said.
Leachman disagreed.
“It cannot be accounted for in your current budget— doesn’t mean it can’t be included. If you don’t have the revenue to pay for something, it’s not accounted for,” Leachman said, contending that it’s in the Treasury Department’s interest to interpret the bill broadly to avoid spending cuts that’ll worsen the recession.
“States and localities are very likely to find when they’re writing their budgets for the coming fiscal year that the aid that they’re receiving is not going to be enough,” he said.
This story was originally published April 1, 2020 at 5:40 PM.
