U.S. Rep Adam Schiff appeared on screen at the West Hollywood City Council meeting tonight – its second virtual meeting – to discuss his push for federal funding for small cities whose economies have been damaged by the COVID-19 pandemic.
Schiff noted that the $2.2 trillion federal Coronavirus Aid, Relief, and Economic Security (CARES) Act, signed into law on March 27, provides money only for cities with populations of 500,000 or more. Only 36 of the nation’s 19,000 cities and towns are that large he said. West Hollywood has a population of 36,854 people according to the U.S. Census Bureau’s 2018 estimate.
According to a survey by the United States Conference of Mayors, 87% of cities with populations of 50,000 or less anticipate a decline in revenue this year. City Manager Paul Arevalo has said that West Hollywood will likely see a decline of 15 to 20%.
Schiff said he has sponsored legislation that would provide $150 billion in relief to small cities like West Hollywood. House Democrats also want to appropriate $100 million in aid to hospitals and a 15% increase in spending on the Supplemental Nutrition Assistance Program, which provides the services formerly provided under the food stamp program. Schiff also is advocating for $100 million in relief for renters and small landlords.
The bill for providing funding for small cities would direct the Federal Emergency Management Agency (FEMA), which manages the funding, to consider payments to cities with a population of up to 250,000 that have suffered a financial loss in excess of 10% of their general fund or which is greater than $100 per resident. West Hollywood likely would qualify. Its general fund budget for the 2019-2020 fiscal year is $110 million. Of that, $29 million (37%) comes from the hotel room tax, revenue that is expected to fall dramatically now that 18 of the cities 22 hotels have closed because of the COVID-19 pandemic.
In his talk tonight, Schiff called out a disparity in the Paycheck Protection Program, which was allocated $349 million by the CARES act to provide financial relief to small businesses, which it defines as those with 500 or fewer employees. That money was quickly dispensed, with more than 70 publicly traded companies receiving money from it. The money went to big restaurant chains like Ruth’s Chris Steak House, which has 150 locations and is valued at $250 million, and Shake Shack, the $1.6 billion hamburger chain that has a location in West Hollywood. Those and other large companies were able to apply for PPP grants through multiple subsidiaries that fell under the 500-employee limit. Congress and the White House are negotiating a deal to add another $310 million to the PPP program and to make sure it focuses on genuine small businesses.
Schiff also argued that the federal government should have funded a payroll guarantee program, citing one implemented in Denmark where companies are given money by the government on the condition that they use that money to keep their employees working.
Councilmember John Duran suggested to Schiff that healthcare agencies look to the gay community as a model for figuring out how to test for the coronavirus, noting its experience with testing during the HIV pandemic. Duran cited the city’s relationships with the LA LGBT Center and the Saban Free Clinic, non-profit institutions that receive city funding, as valuable resources for implementing an aggressive testing campaign. He and Councilmember John Heilman said that West Hollywood would be a good location for trying out both various approaches to testing for the COVID-19 virus and for antibodies to that virus.
Heilman said that he knows someone who would donate tests for antibodies to the COVID-19 virus. The presence of antibodies indicates that someone has been infected and has recovered. However, Heilman acknowledged that there have been questions about the efficacy of such tests. It is not clear whether those who have recovered from a COVID-19 are immune from getting reinfected.