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. 2020 Aug 2;80(5):827–831. doi: 10.1111/puar.13257

How Can Local Governments Address Pandemic Inequities?

Aaron Deslatte 1,, Megan E Hatch 2, Eric Stokan 3
PMCID: PMC7300550  PMID: 32836452

Abstract

COVID‐19 is exposing a nexus between communities disproportionately suffering from underlying health conditions, policy‐reinforced disparities, and susceptibility to the disease. As the virus spreads, policy responses will need to shift from focusing on surveillance and mitigation to recovery and prevention. Local governments, with their histories of mutual aid and familiarity with local communities, are capable of meeting these challenges. However, funding must flow in a flexible enough fashion for local governments to tailor their efforts to preserve vital services and rebuild local economies. The authors argue that the Community Development Block Grant and the Energy Efficiency and Conservation Block Grant programs are mechanisms for providing funds in a manner that is adaptable to local context while also focusing on increasing social equity. Administrators must emphasize the fourth pillar of public administration—social equity—in framing government responses to the pandemic.


In terms of income, racial, and class cleavages, the United States remains a nation divided. SARS‐CoV‐2, the virus that causes coronavirus disease (COVID‐19), is exposing a nexus between communities disproportionately suffering from underlying health conditions, policy‐reinforced disparities, and susceptibility to the disease (Chin et al. 2020; Pareek et al. 2020). African Americans and those with low incomes are more likely than other groups to experience acute symptoms and death. The death rate is so high in some African American communities that CNN political commentator Van Jones called reopening states “a death sentence for communities of color.” 1 Some of the worst outbreaks are among vulnerable populations—in prisons and nursing homes and among the homeless and unhoused. According to the New York Times, as of May 25, 2020, more than 35,000 nursing home and long‐term care facility residents and staff members had died from the virus (one‐third of deaths from COVID‐19) and 7 of the 10 largest outbreaks were in correctional facilities. 2 The challenges for homeless populations are compounded by the near impossibility of social distancing. While factors such as age and underlying conditions increase the susceptibility of certain groups to the virus, it is clear that structural and policy disparities contribute to disparities in infection and death rates.

The solution to the crisis will require policy change and flexible funding for local governments on the front lines (Kettl 2020). In the coming months and years, policy responses will need to shift from focusing on surveillance and mitigation to recovery and prevention (Gupta et al. 2020). Local governments understand the unique needs of their communities and may be the most capable units of government to do so. Some cities have already responded by issuing eviction moratoriums, providing places to stay for unhoused populations, and distributing food. Combined with efforts by counties to reduce their incarcerated populations and state stay‐at‐home orders along with other public health policy responses, these actions aim to address existing inequities. However, much more will need to be done to address these deeply rooted disparities. These are not simple problems and will necessitate taking on long‐standing discriminatory and economic injustice challenges. 3

While perhaps the most capable, many local governments have been poorly served by their states and the federal government and cannot address the COVID‐19 pandemic and its consequences alone. They need the federal government to provide funding and to ease rules that make it difficult for governments to act. We argue in this essay that the Community Development Block Grant (CDBG) and the Energy Efficiency and Conservation Block Grant (EECBG) programs are models for providing funds in a manner adaptable to local context while also focusing on increasing social equity. States and local governments will need license to act, which may involve striking previous preemptions that hinder local governments’ responsiveness (Goodman, Hatch, and McDonald 2020) or loosening administrative rules. For example, the U.S. Department of Housing and Urban Development (HUD) has waived some regulatory requirements for Community Planning and Development grants and the Housing Choice Voucher Program. 4 Intergovernmental dialogue will be necessary for the federal government to understand what financial and administrative support states and local governments need.

Now more than ever, administrators must emphasize the fourth pillar of public administration—social equity—in framing government responses to the pandemic (Norman‐Major 2011). Only within a social equity lens will administrators be able to address the dual concerns of why COVID‐19 is having a disproportionate impact on some groups and what can be done about it (McCandless and Larson 2018). Local governments, with their histories of mutual aid and familiarity with local communities, are capable of meeting these challenges. However, federal policies and funding must flow soon, and in a flexible enough fashion for local government authorities to tailor their efforts to preserve vital services and rebuild local economies.

Major Stimulus Initiatives Must Better Manage Distributive Consequences

Federalism has been touted as a hotbed for innovation and creative policy making, with evolving interconnections between the roles, responsibilities, policy tools, and administrative mechanisms of national, state, and local actors (Dahl 2005; Feiock and Scholz 2009; Peterson 1995). The COVID‐19 response in the United States has exposed the coordination problems and ideological, cultural, and social differences that produce conflict in such diverse systems. However, the U.S. intergovernmental experience also demonstrates how systems of concurrent, overlapping governance can organize, collaborate, and coproduce to gain economies of scale, diffuse knowledge and experiences, improve performance, and respond to threats (Ostrom 1990; Ostrom, Tiebout, and Warren 1961). As evidenced here, communities can and are turning to each other, the nonprofit sector, and private enterprise to maintain social safety net services.

Despite the potential for collaborative responses to disasters, a lesson from our history is that attempting to rebuild local economies can produce community winners and losers (Howell‐Moroney 2008). Urban Renewal, launched in 1949 to confront inner‐city decline, epitomizes this problem. The program displaced hundreds of thousands of mostly poor, minority households under the guise of “slum clearance” while clearing the way for shopping malls, performing arts centers, and highways. The hard lessons learned from these experiences should not be overlooked when developing federal stimulus efforts touted to help “rebuild” economies (Jacobs 1961).

For instance, the recognized failure and mistreatment of minority communities under Urban Renewal prompted the Lyndon B. Johnson administration in 1966 to push forward the Model Cities program. This reform was notable in part for its reliance on a public participatory process whereby citizens largely determined the direction of funds and for the categorical nature of the grant reflecting the federal government's priorities in redevelopment (Weber and Wallace 2012).

President Richard Nixon, along with many Republicans in Congress, felt that the federal government's role was displacing what should be considered the purview of local decisions. Thus, rather than relying on categorical grants reflecting the priorities of the federal government, discretion and decision‐making would be left to local governments with the passage of the CDBG program in 1974. While decision‐making would now be decentralized, communities were largely on their own to develop the capacities to use these funds wisely and ensure they were meeting the goals of community development. Today, the CDBG program administered by HUD has very few requirements. For local governments to qualify as “entitlement communities,” they must have a population of 50,000 and greater for municipalities or 200,000 or greater for counties. Additionally, states receive money to be spent on non‐entitlement communities that fall below this population threshold. Whether communities qualify as “entitlement” or “non‐entitlement communities,” local governments must spend 70 percent of the funds in low‐ to moderate‐income (LMI) areas or to benefit members that are LMI within those areas. 5

Federalism works best when it complements rather than replaces federal authority. Intergovernmental cost sharing and “fiscal federalism” mechanisms, such as block grant programs, have evolved to better address these problems. While they are far from perfect, we argue that the flexibility and expediency needed now make them the best approach to revive local economies while supporting low‐income communities.

Local Governments Have Struggled with Equitable Development for Decades

The COVID‐19 crisis has highlighted the extraordinary tension that governing in a federal vacuum can create. Clear lines of authority and responsibility in some cases have broken down, with state and local governments working against rather than with one another. Examples abound of cities and states competing with each other and the federal government to purchase ventilators and personal protective equipment. 6 These cases expose a worrisome competition in which governments with less money and power cannot obtain vital resources to protect public health.

In some ways, these COVID‐19 coordination problems mirror state and local economic development efforts over the last four‐plus decades. It has long been the purview of state and local governments to create jobs and generate own‐source revenues. Today, governments at both levels rely on a broad set of strategies and policy tools to achieve these ends. Such efforts historically revolved around offering firms property tax abatements, tax credits, and tax increment financing (TIF). This typified the tools used for “smokestack chasing.” Some communities evolved to focus more on retaining and expanding businesses, spurring entrepreneurship and small business growth. Business incubators and accelerators have become commonplace. A smaller subset of cities has transitioned to approach development in a more inclusive fashion with a cognizance for long‐term sustainability (Hawkins et al. 2016). While this progress is noteworthy, the local economic development landscape in the United States is still broadly characterized by intense competition for resources (Zheng and Warner 2010). In the absence of clear federal guidance for how economies should rebuild, along with flexible funding, the long‐term recovery of communities may inevitably resemble “status quo” economic competition.

Recent research suggests there are factors that determine which trajectory governments pursue (Deslatte and Stokan 2019). Localities make trade‐offs between traditional firm‐based approaches focusing on tax abatements and TIFs and alternative approaches featuring job training assistance, community development loans, entrepreneurship and sustainability (Stokan, Deslatte, and Hatch 2020). These trade‐offs are explained by three factors: (1) local government competition for economic development, (2) organizational capacities (financial, technical, political), and (3) organizational interconnectedness—the set of actors that are present to influence policy selection (e.g., government and private sector actors). These factors are also baked into the historical pattern of path dependence which present barriers to moving toward a path of social equity and sustainability.

This is important now, because governments face extreme pressures to jump‐start local economies in the months and years ahead. Most will also likely need to reduce capital asset investments, delay or cancel purchases, consider monetizing their assets, impose new fees, and otherwise reallocate diminished resources. In many cases, local governments will be even more reliant on policies that do not require cash outlays today (property tax abatements and TIFs); however, these tools tend to be associated with smokestack chasing unless they are reconfigured in a way to achieve goals of social equity and sustainability.

The creativity that is needed now is will help determine how to best structure economic development policies to leverage fiscal resources in a way that can promote growth, social equity, and sustainability. This might mean using traditional tools such as TIF or property tax abatement, but only as a means to stabilize existing businesses or in a way that has strong mechanisms that ensure stable housing and job training plans among the new businesses. At the very least, tax dollars should not be used to continue attracting businesses such as Amazon, which has realized huge profits since the beginning of the COVID‐19 pandemic (estimated at $24 billion). 7 Instead, these funds could be used to bolster local businesses and spur entrepreneurship within local communities. This is also why it is imperative that federal stimulus efforts allow local governments to direct resources in a way that produces a recovery felt by all. The RISE framework recommended by Maher, Hoang, and Hindery (2020) offers a promising way for administrators to think about how to respond effectively to these challenges while also focusing on future needs.

Cities Responses and the Social Equity Gap

Local government managers and elected officials know their communities and needs best. There is already evidence that local governments are making a variety of temporary moves to address the disproportionate impacts of COVID‐19 on disadvantaged communities. The National League of Cities (NLC) and Bloomberg Philanthropies have collected self‐reported data from nearly 500 cities on the policies programs or action taken to preserve operations and target services to vulnerable or impacted populations, including the homeless, limited English‐speakers, children, low‐income households, and seniors. Of the more than 1,700 actions tracked through May, roughly 34 percent targeted these populations with items such as housing, utility, or food assistance (NLC 2020).

Cities across the United States have taken steps to provide shelter, sanitation, and other services to the homeless while targeting housing assistance to prevent their ranks from growing. Cities such as Portland, Oregon, and Glendale, Arizona, suspended evictions of public housing tenants, according to the NLC data. Philadelphia announced a partnership with United Way to aid nonprofit organizations at risk of eviction. Tampa, Boston, Atlanta, and New Orleans have partnered with nonprofit groups, chambers of commerce, and professional sports teams to offer mortgage, utility, and rental assistance to COVID‐impacted households (NLC 2020). Cleveland halted water and power shutoffs and restored service to properties with disconnected utilities. Chicago and its public school system joined forces with a multinational hedge fund to distribute $2.5 million in food to vulnerable populations. Detroit partnered with local restaurants to distribute surplus food. Houston partnered with a mattress delivery company and a grocery chain to deliver 10,000 meals to seniors.

Moreover, the activities are not restricted to large cities in “blue states.” Daphne, Alabama, waived garbage fees. Tallahassee, Florida, donated 3,000 pounds of food to a local food bank. Boulder, Colorado, announced a “Creative Neighborhoods: COVID‐19 Public Works” program to support public art and artists. Kalamazoo, Michigan, restored water services to all its delinquent accounts. Dozens of cities such as Topeka, Kansas; Ashland, Kentucky; Lafayette, Indiana; Monroe, Louisiana; and Sandusky, Ohio, announced they would cease water shutoffs (NLC 2020).

At the same time, cities are facing a wave of furloughs, layoffs, and budget cuts. According to one NLC analysis, cities, towns, and villages across the country are anticipating $360 billion in revenue shortfalls between 2020 and 2022 (McFarland and Rivett 2020). Information compiled from 2,463 cities, towns, and villages by the NLC and the U.S. Conference of Mayors in mid‐April indicated that 55 percent of cities with populations over 50,000 expected to furlough employees and 38 percent expected to lay off workers. The largest budget hits are coming from lost permitting fees, food and beverage taxes, utility fees, local‐option sales taxes, and property taxes. More than half expected to cut services in 2020, including police and public safety. Without substantial federal intervention, it is likely that the temporary measures cities have taken to address inequalities will be unsustainable, and disadvantaged communities will suffer the most from service cuts.

Federal Government Fiscal Stimulus and Social Equity

The federal government has already acted to push billions of dollars to local governments. However, the largest share of these resources which could have been allocated broadly—a $150 billion Coronavirus Relief Fund—was limited to local governments with populations over 500,000. While local governments have been actively lobbying for federal stimulus which would allow them to backfill their budget holes, rebuilding local economies to be more socially, environmentally, and economically equitable can also be a priority. Communities large and small are struggling to preserve vital services now, but they must also kick‐start construction and development, business expansion, infrastructure investment, and other economic activity in the months and years ahead.

The United States already has successful templates for delivering resources directly to local governments, through existing community development and energy‐efficiency block grant programs. These programs have empirically demonstrated they can help localities create jobs, improve environmental resilience, and address social equity. What will be required is the willingness on the part of national, state, and local political leaders to capitalize on existing administrative capabilities—the expertise, experience, know‐how, and lessons learned from the managers who have run these programs.

The first template is the existing CDBG program. The Coronavirus Aid, Relief, and Economic Security (CARES) Act devoted $5 billion to the CDBG program, a significant boost over the $3.4 billion appropriated in the 2020 fiscal year. Of that amount, HUD appropriated $2 billion first, using the same formula for existing fiscal year 2020 grantees. A second round of $1 billion was allocated to states in May, with directives to devote it to projects that address public health needs, risk of transmission of coronavirus, and economic and housing market disruptions. The remaining $1.9 billion will be allocated on a rolling basis at the behest of HUD's secretary by October 2022. These projects can provide important catalysts for sustainable and more equitable community development. But the needs far outstrip the resources allocated thus far. Within states, existing CDBG program funds are being rerouted to pandemic response. For instance, Indiana governor Eric Holcomb created a new COVID‐19 Response Program in mid‐March to redirect CDBG funds from planning to rural community projects. Within two weeks of its launch, 103 towns and counties had requested help. The projects approved include installing Wi‐Fi hotspots in LMI communities for e‐learning, making small business loans in these communities, and enhancing testing. But the vast majority of the proposals could not be funded.

A second template is the U.S. Department of Energy's EECBG Program, which was funded as part of the 2009 American Recovery and Reinvestment Act. Loosely based on the CDBG program, EECBG steered approximately $3.2 billion to 2,187 state, local, and tribal governments, which undertook more than 7,400 energy‐efficiency projects. Launched in response to the Great Recession, the program was given two seemingly conflicting mandates: spend money quickly to help spur the economy while also helping local governments transition to clean energy futures. Although this produced documented delays in allocating dollars, the project was successful at both aims. The final evaluation of the program determined it produced a net job gain of 62,902 job years, avoided 25.7 million metric tons of carbon emissions, and led to $5.2 billion in total cumulative savings on energy bills, of which 70 percent came from residential consumers (U.S. Department of Energy 2015). Moreover, the program helped many local governments take initial steps into sustainability, through hiring staff, building expertise, and creating momentum for broader organizational changes (Deslatte and Swann 2020; Terman and Feiock 2015).

Despite its success, the program was not refunded, and it was deemed a disappointment by some within the Energy Department because of early project delays (GAO 2011; Watson 2020). However, the EECBG experience demonstrated that local governments with previous commitments to sustainability were more able to successfully leverage grants to tackle a wider array of projects (Watson 2020). Smaller governments and those with less organizational capacity faced greater obstacles (Terman and Feiock 2015) and were less likely to make longer‐term commitments. This is consistent with our own research that resource capacity is a key factor in whether local governments are able to engage in equity‐oriented development (Stokan, Deslatte, and Hatch 2020). Local governments across the United States have made demonstrable strides in sustainability planning, capacity building, and performance over the last decade (Hawkins et al. 2016; Swann and Deslatte 2019). Thanks to past investments, they can pursue economic and social equity objectives. The experience also demonstrated the importance of collaborative networks and interconnectedness for diffusing innovative project ideas across governments (Park, Krause, and Feiock 2019; Swann 2017; Terman, Feiock, and Youm 2020). Lessons learned from the EECBG program can help inform design changes in the administration of a second round of green energy and infrastructure grants. A block grant‐style infrastructure stimulus can help local governments provide community health, clean drinking water, clean energy, broadband, and better transportation systems.

Conclusion

Across the world, many governments are recognizing that restarting their economies presents an opportunity to take on climate change and inequality through investments in green buildings, infrastructure, and energy. New York City, for instance, has announced a COVID‐19 “recovery for all” plan to target social inequity as part of its economic rebuilding efforts. Leaders across sectors and at all levels of government recognize that crises are the time to improve upon existing economic and social structures. As Kettl (2020) asserts, now is the time for policy change, not a return to the status quo. We concur, and we argue the response to COVID‐19 should be viewed through a social equity lens, using the current circumstance to be “a lever for change” (Guy and McCandless 2012). Local governments can focus their efforts to ensure a more equitable and sustainable development pattern going forward. The U.S. federalist system has gotten a bad rap during the COVID‐19 response, but state and local governments have proven time after time to be a major incubator of innovation. They deserve the chance to prove it again.

Biographies

Aaron Deslatte is assistant professor and director of the Metropolitan Governance and Management Transitions Lab at Indiana University Bloomington. His research focuses on the roles that public managers play in enhancing economic, environmental, and social sustainability at the local and metropolitan scales.

Email: adeslatt@iu.edu

Megan E. Hatch is associate professor of urban policy and city management in the Maxine Goodman Levin College of Urban Affairs at Cleveland State University. Her research focuses on the causes and consequences of state and local policies that disproportionately affect vulnerable populations.

Email: m.e.hatch@csuohio.edu

Eric Stokan is assistant professor of political science at the University of Maryland Baltimore County. His research focuses on understanding local government decision‐making, policy processes, and evaluating the impact of policy decisions.

Email: estokan@umbc.edu

Notes

1

Paul LeBlanc, “Van Jones Says States Reopening Businesses amid Coronavirus Is “A Death Sentence for Communities of Color,” CNN, April 21, 2020, https://www.cnn.com/2020/04/21/politics/coronavirus‐georgia‐reopening‐van‐jones/index.html (accessed July 9, 2020).

2

“Coronavirus in the U.S.: Latest Map and Case Count,” New York Times, https://www.nytimes.com/interactive/2020/us/coronavirus‐us‐cases.html (accessed May 25, 2020).

3

Adrienne Hollis, “The Crisis within the Crisis: COVID‐19 Is Ravaging African Americans,” Union of Concerned Scientists Blog, April 29, 2020, https://blog.ucsusa.org/adrienne‐hollis/the‐crisis‐within‐the‐crisis‐covid‐19‐is‐ravaging‐african‐americans#.XqmzQVlol4s.twitter (accessed July 9, 2020).

4

Monique King‐Viehland and Corianne Payton Scally, “Five Ways State and Local Governments Can Strengthen Their Capacity to Meet Growing Rental Assistance Needs,” Housing Matters, April 29, 2020, https://housingmatters.urban.org/articles/five‐ways‐state‐and‐local‐governments‐can‐strengthen‐their‐capacity‐meet‐growing‐rental (accessed July 9, 2020).

5

HUD Exchange, “CDBG Entitlement Program Eligibility Requirements, https://www.hudexchange.info/programs/cdbg‐entitlement/cdbg‐entitlement‐program‐eligibility‐requirements/ (accessed July 9, 2020).

6

Amy Feldman, “States Bidding against Each Other Pushing Up Prices of Ventilators Needed to Fight Coronavirus, NYC Governor Cuomo Says,” Forbes, March 28, 2020, https://www.forbes.com/sites/amyfeldman/2020/03/28/states‐bidding‐against‐each‐other‐pushing‐up‐prices‐of‐ventilators‐needed‐to‐fight‐coronavirus‐ny‐governor‐cuomo‐says/#7739f991293e (accessed July 9, 2020).

7

Martin Lerma, “Jeff Bezos's Net Worth Has Increased by $24 Billion during the COVID‐19 Pandemic,” Robb Report, April 21, 2020, https://robbreport.com/lifestyle/news/jeff‐bezos‐made‐24‐billion‐during‐coronavirus‐pandemic‐2915078/ (accessed July 9, 2020).

Contributor Information

Aaron Deslatte, Email: adeslatt@iu.edu.

Megan E. Hatch, Email: m.e.hatch@csuohio.edu

Eric Stokan, Email: estokan@umbc.edu.

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