Members of Congress are currently debating whether to provide another round of federal bailout money to state governments in response to the COVID-19 recession.
Gov. Kevin Stitt is not among the supporters of that proposal.
“I don’t think we need another stimulus package, no,” Stitt said.
The governor said Oklahoma officials have not yet been able to spend all the money given to Oklahoma in the first round of federal COVID funding.
“Our $1.2 billion that we’ve been allocated so far in Oklahoma, we haven’t got it out,” Stitt said. “And so our message back to the White House was before we go to the well and do another $2 trillion bailout, let’s make sure, let’s get these monies out the door first.”
One state legislative Democrat quickly criticized Stitt’s stance.
Rep. Cyndi Munson, D-Oklahoma City, tweeted, “…but what do the people think? Especially those who have lost their businesses, jobs, family members, housing, transportation, and their health?”
Stitt’s comments come just a day after U.S. Sen. James Lankford, R-Oklahoma City, criticized a federal bailout proposal approved by the Democratic-controlled U.S. House of Representatives.
In the spring, as the pandemic forced shutdowns across the nation, Congress approved significant bailout funding for states. Lankford noted that package included $150 billion for state governments, $260 billion for health care, and $30 billion for education.
But the congressional Democratic proposal for new bailout funding—which totals $3 trillion—includes nearly $1 trillion more for state governments.
“Just to be able to put that in perspective, the total budget for every state in America is $900 billion,” Lankford said. “Every state’s total budget combined spending that they do in a year, $900 billion. My Democratic colleagues want us to give almost $1 trillion to the states for COVID expenses. Their total budgets for every state in the entire country for the entire year is just over $900 billion, and they're willing to give $1 trillion to them on top of it. That is more than replacing every state budget in America. That is absurd.”
A recent analysis from the Tax Foundation indicates the federal funding already provided to states may more than offset tax-collection reductions caused by the COVID-19 shutdown. The foundation concluded that state governments would collectively see a decline of $121 billion from the shutdown. That’s less than the $150 billion already provided to state governments in prior federal bailout measures this year.
The foundation’s estimate was extrapolated from reports issued by 12 states since many states have not released updated forecasts.
“Revised state revenue forecasts show a significant decline in projected revenues for both the recently concluded FY 2020 and current FY 2021, though the picture they paint is considerably less dire than many feared a few months ago,” the Tax Foundation report stated. “Extrapolating from available data suggests a $121 billion nationwide decline in state tax revenue for the two fiscal years compared to a FY 2019 baseline, though estimates from such limited and provisional data should be regarded with caution. What is increasingly clear, however, is that revenue losses, while substantial, are not on track to match the worst fears of many analysts earlier in the COVID-19 pandemic.”
The Tax Foundation’s figures were more optimistic than those previously issued by Moody’s, which projected two-year state-government losses of $274 billion against a 2019 budget-year baseline, but the Moody’s estimate was still far less than the amount of state government bailout funding now proposed by Democrats.
“The emerging picture of states’ revenue shortfalls argues, at the very least, for a less expansive package than those floated in late spring,” the Tax Foundation report stated.