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Introduction to the Special Issue: The Impact of COVID-19 on Big Cities’ Budgets  


Author:  Min Su.


Source: Volume 42, Number 01, Spring 2021 , pp.1-3(3)




Municipal Finance Journal

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Abstract: 

The COVID-19 pandemic has created unprecedented challenges to state and local governments in the United States, challenges that are not evenly distributed across the nation. Big cities in metropolitan areas—the very core of the nation’s productivity capacity—have been hit the hardest. As frontline responders, they face a budget crisis, as rapid expenditure increases and precipitous revenue declines lead to large budget gaps and increased demand for liquidity. This first of two symposiums examines the economic portfolios of Atlanta, Charlotte, New York City, and Phoenix, reviewing their baseline budgetary measures before the pandemic, early indicators of the pandemic’s impacts on their budgets, their immediate budgetary responses, and the implications of their budgetary decisions. Because the COVID-19 pandemic is still unfolding at the time of this symposium, the four case studies included here focus primarily on the early indicators of the pandemic’s impacts and the cities’ immediate budgetary responses. Although the authors of these case studies discuss foreseeable fiscal challenges, the pandemic’s long-term consequences for these cities’ economies and their public finance, budgeting, and intergovernmental relations are not yet fully known. The case studies in this symposium show that cities were able to use various fiscal tools to address the short-term concerns of the pandemic. With the help of federal aid, these cities temporarily avoided dramatic budgetary actions. However, as the pandemic continues, the economic and fiscal hardship will exacerbate and may even challenge the existing budget institutions.

Keywords: U.S. cities and COVID-19, expenditure increases in cities, revenue declines in cities, budget gaps in cities, cities’ increased demand for liquidity

Affiliations:  1: Louisiana State University.

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