Whitmer, govs. ask feds for aid as state could face $7B revenue hit

Michigan Capitol | Susan J. Demas

Gov. Gretchen Whitmer, along with Wisconsin Gov. Tony Evers and Pennsylvania Gov. Tom Wolf, sent a letter to President Trump Wednesday requesting that he expedite additional resources for all states and localities so that they can address economic shortfalls resulting from the COVID-19 crisis.

“Without this leadership, the damage to our state economies will be exacerbated by the cuts we know we will be forced to make,” the governors said. 

Gov. Gretchen Whitmer gives an update on COVID-19 | Gov. Whitmer office photo

They noted National Governors Association that Chair Maryland Gov. Larry Hogan and Vice Chair New York Gov. Andrew Cuomo support a $500 billion in state stabilization funds “that will allow for the replacement of lost revenues and with the maximum flexibility possible so the funding can be used beyond those costs directly tied to COVID-19 related expenses.”

There are now 28,059 positive cases of COVID-19 in Michigan as of Wednesday afternoon, although state officials believe the actual number of cases is much higher. The state also reports that 1,921 Michiganders have died of the disease.

To slow the spread of COVID-19, Whitmer put in place a stay home order and temporarily closed a number of non-essential businesses until April 30.

The governor’s office predicts state revenues in Michigan could be reduced by $3 billion alone this year, and $7 billion over the next 18 months – due to measures taken to halt the spread of COVID-19. This year’s Fiscal Year 2020 budget is $59.4 billion.

Michigan has an emergency rainy day fund of about $1.2 billion.

Over 1 million new unemployment claims have been filed since March 15, a 5,000% increase over a four-week period, representing roughly a quarter of Michigan’s workforce. Experts predict these cuts to the state revenue will lead to continued and major job losses in my state. 

Michigan unemployment could hit 23% and other alarming economic forecasts

“As the COVID-19 crisis continues, the health of our people and our economies are dependent on your actions in the coming days and weeks,” the governors continued. “We implore you to act decisively and expeditiously during this unprecedented time for our Nation.”

The U.S. Department of the Treasury launched an online portal this week for eligible state, local, and tribal governments to receive payments to help offset the costs of their COVID-19 response.

An initial $71 billion from the Coronavirus Aid, Relief, and Economic Security (CARES) Act is to be made available to meet some immediate cash flow needs. However, the governors say states will need more assistance to address the economic impacts of the virus. 

Senate GOP spokesperson Amber McCann, House GOP spokesperson Gideon D’Assandro and State Rep. Shane Hernandez, who chairs the House Appropriations Committee, were not able to comment on whether Republican leaders support the governor’s request or plan to make their own requests to federal officials.