Police budgets are mostly paid by local governments. And for local governments, COVID-19 has been a fiscal catastrophe. Local governments fund themselves through a combination of property taxes, sales taxes, income taxes, special taxes (on the occupants of hotels, for instance), and aid from states. By slashing consumer spending, the pandemic has slashed sales-tax revenue. The collapse of tourism has decimated special taxes paid by the hospitality industry, and job losses have reduced revenue from income taxes. Moreover, states—which face their own budgetary shortfalls—are likely to cut local aid. The result, according to the National League of Cities, is that from now until 2022, cities collectively face a budgetary hole of $360 billion.
On May 15, House Democrats responded by passing the HEROES Act, which would have allocated close to $1 trillion to state, local, and tribal governments—$375 billion of which would have gone to cities and counties. Because most states and many cities start their fiscal year on July 1, that cash might have helped local governments stave off major budget cuts.
Senate Republicans, however, oppose another large infusion of federal funds anytime soon. In April, McConnell suggested that states respond to their fiscal woes by declaring bankruptcy. Earlier this month, Chuck Grassley, the Republican chairman of the Senate Finance Committee, cited a better-than-expected May jobs report as evidence that Congress should “not rush to pass expensive legislation paid for with more debt.”