Santa Monica has been hit hard by the pandemic, which created a $224 million deficit in the City’s operating budget leading to mass layoffs and reductions in City services. In an effort to increase funding, the City is supporting the Democrats’ newly proposed HEROES Act for COVID-19 financial relief and also fighting for a more equitable distribution of relief funds through the state government.
Currently, there is a significant inequity in the state’s allocation of $500 million in federal funding from the CARES Act between large and small cities.
Six of California’s thirteen cities with a population of over 300,000 were allocated funding equal to $174 per person and the other seven received funding equal to $85 per resident. However, cities like Santa Monica that have a population under 300,000 only received $12.28 per resident.
Mayor Kevin McKeown alongside 42 other mayors in the California Mayors Coalition signed a letter to Governor Newsom urging him to provide more equitable financial relief to cities.
“Living in a ’small’ city shouldn’t diminish a Californian’s access to urgently needed relief funding. We realize resources are limited, but we’re asking for simple equity. Santa Monica is a regional job center and transportation hub, but the small city funding model from Sacramento has left us unfairly unable to pay for services depended on by people from all over Southern California,” said McKeown.
In Santa Monica the financial fallout of the pandemic resulted in the elimination of 298 full-time and 122 part-time City staff members. Two public library branches have been shut and grant funding to local nonprofits that provide vital direct services has been reduced by $955,541.
A distribution of federal funds based on resident population would significantly increase Santa Monica’s funding and help the City revive some of its reduced or eliminated services. As the City looks for more federal funding it also supports the updated HEROES Act, which was released by House Democrats on Monday.
“A new coronavirus relief bill introduced by the House of Representatives would, if passed, provide $2.2 trillion in federal funding, including $89.5 billion for local municipalities to respond to and recover from the impacts of the COVID-19 pandemic,” said Interim City Manager Lane Dilg. “An allocation of a portion of this funding to the City of Santa Monica would support our pandemic response, including things like the food pantry at Virginia Avenue Park and the City’s Emergency Rental Assistance Program, and also bolster community services by replacing some lost revenues caused by the economic crisis precipitated by the pandemic.”
The latest HEROES Act would expand the Paycheck Protection Program, provide $225 billion for education nationally, send out another set of $1,200 stimulus checks, and restore weekly $600 unemployment benefits. It is an updated version of the HEROES Act Democrats released in May, which was $1.2 trillion more expensive and failed to advance to the Senate.
"Cities like Santa Monica are the level of government where funding becomes services, and we welcome renewed hope that federal funding may at last be released to help repair holes in city budgets due to the coronavirus pandemic economic collapse,” said McKeown. “Any new HEROES Act coming out of Washington needs to prioritize quick grants to local governments, where the money can most quickly and effectively improve the lives of all Americans.”
