Current Situation
On October 13, House Speaker Nancy Pelosi held an Economic Forum with House leaders and national economists. It was stated at the Forum that up to a $300 billion stimulus may be needed. Infrastructure and jobs were highlighted to be included in a stimulus package.
Even before the Forum, Speaker Pelosi stated that a $150 billion may be needed - and she indicated she will call the House back to Washington after the November 4 elections. She has since made similar statements. Senate Majority Leader Reid has also said he expects the Senate to take up a stimulus bill after the elections.
Speaker Pelosi has directed the appropriate House committee chairs to hold hearings on this critical issue, and those hearings started on October 20 and will continue until the final one on October 30.
2008 USCM Winter Meeting - $168 Billion Tax Rebate Stimulus
In January of this year at our Winter Meeting in Washington, the reality of the first stimulus package was an issue among our own mayoral leadership. In the Executive Committee, mayors raised seriously the question of an infrastructure package to be included as a part of the tax rebate stimulus package that was being put together by President Bush and Speaker Pelosi.
After discussions, mayors decided to support the first stimulus package and to wait for the second stimulus to demand infrastructure short-term investments to keep our metro economies strong. This $168 billion tax rebate package was passed by the House and Senate and signed into law in February. Hence money went out in the form of tax rebates, but the gasoline costs skyrocketed to an all time high and no doubt many of those payments helped millions to ease the pump pain and reduced their personal and household increased energy costs.
House and Senate Action on Pelosi and Reid/Byrd Package
Last month, a second stimulus package amounting to $60 billion passed the House. A similar stimulus package was blocked in the Senate, receiving 52 votes, 8 votes short of the 60 needed to prevent a filibuster. The U.S. Conference of Mayors supported both measures – which relied heavily on infrastructure investments.
$700 Billion Wall Street Bailout
The national economic crisis that came to a head last month prompted the White House and Congress to provide a $700 billion measure, termed by many and commonly referred to as a Wall Street Bailout. Conference President Manny Diaz of Miami sent a letter to Congress urging them to act.
Main Street – Cities, Counties and States
As many citizens and small businesses saw their tax money going to help Wall Street, there was serious concern over the Federal Government seemingly ignoring the needs of Main Street America.
While the $700 Billion measure has helped stabilize the financial and banking system, the citizens and small businesses of our cities, counties and states are concerned about the credit crunch, and loss of jobs in this economic downturn.
At our Conference of Mayors Fall Leadership earlier this month, a Main Street Stimulus package was discussed and Conference staff was directed to develop an infrastructure and jobs Main Street Stimulus package.
Our base for a new Main Street Stimulus was built on the $60 billion proposal, mentioned above, that passed the House and was blocked in the Senate. The total amount of our Main Street Stimulus is based on a $150 billion stimulus amount that is being currently being mentioned by Congressional leaders. All initiatives of our Main Street Stimulus meet the jobs and infrastructure criteria of quick short-term investments to stimulate Main Street with jobs for unemployed workers and economic activity for businesses in our metro areas. We have added three initiatives to the House-passed bill. They are CDBG, Infrastructure, Green Jobs- Energy/Environment Block Grants, and Public Safety. In addition, we are adamant that highway funds must be distributed through the Surface Transportation Program to ensure the flexibility of funding will be given directly to our local officials to meet the infrastructure needs in our metro areas.
In all three of these initiatives, CDBG, Energy Block Grants, and STP, upwards of 30
percent would be sent to the 50 states. The remaining 70 percent of these three initiatives would go to cities and county areas - which accounts for 90 percent of the nation’s gross domestic product.
The USCM Executive Committee, Advisory Board, and Committee Chairs received a briefing on our proposal during an October 20 conference call. President Diaz and the members refined and approved our Main Street Stimulus proposal during that call.
Tomorrow we take our proposal to Congress. Two Past-Presidents of the Conference of Mayors will be strong advocates. Louisville Mayor Jerry Abramson will testify before the House Committee on Transportation and Infrastructure. Trenton Mayor Doug Palmer will testify before the House Ways and Means Committee.
As each day passes, economic indicators show strong sentiment for Congress to act on a stimulus measure when they return on November 17. We will need your help to pass our Main Street Stimulus initiative. The key issue will be the Senate – where many Republican and Democratic Senators running for re-election have now endorsed the need for a new stimulus package.
Infrastructure Survey to Mayors – November 7 Deadline
To assist us with further validation, we need your help on giving us immediately your ready-to-go short-term investment projects. Our survey will be sent to you tomorrow (October 29), and we will need that information sent back to us by November 7.
We appreciate your help and immediate attention to this critical issue as we all work together to pass our Main Street Stimulus to assist our citizens and small businesses in cities, counties and states during these challenging times.
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