NEWARK, NJ — For hundreds of thousands of jobless New Jerseyans, months of rent and mortgage payments are due just as $600 federal weekly unemployment benefits are set to expire this week.
In Newark and Essex County, which currently has about a 20% unemployment rate, the absence of continued aid from the federal government would spell nothing short of a disaster, according to officials who joined U.S. Sen. Bob Menendez on the steps of Newark City Hall on Monday to advocate for the passage of a COVID-19 relief bill.
The bipartisan SMART Act, introduced by Menedez and Sen. Bill Cassidy (R-La.) would provide $500 billion in aid directly to state and local governments, staving off continued furloughs and layoffs. Republicans in the Senate have proposed only one additional $1,200 stimulus check, 70% of lost wages in place of $600 and $0 for the states.
Unlike previous CARES Act funding, qualification for the funding would not be determined by a municipality’s population size. Need would be determined by infection rate and lost revenues, meaning states like New York and New Jersey would receive more funding.
Menendez said 1.5 million state and local workers have been laid off or furloughed nationwide since February, double the amount of public sector jobs lost during the duration of the Great Recession of 2008.
“We still have no national plan coming out of Washington. We have no plan to contain the virus. No plan for widespread testing and contact tracing. No plan to ramp up production of vaccines and critical supplies, nothing,” Menendez said.
Locally, Newark has doled out $6 million in financial interventions from its own coffers in the form of grants for nonprofits, small businesses, rental assistance and other stimulus aid. But COVID-19 has also put New Jersey’s largest city, also its virus epicenter, at a projected $143 million deficit.
While officials were preparing to furlough employees in June, Mayor Ras Baraka said the city managed to avoid having to do so by tapping into a small surplus. But that will only hold for the current fiscal year, after which Baraka said is uncertain.
“Obviously, next year, we won’t have this type of surplus. We have, as the county has, a gap in people paying their taxes, especially special taxes in hotel, parking, payroll. Nobody’s traveling, nobody’s parking, we’re experiencing a significant revenue loss there,” he said.
Essex County Executive Joseph DiVincenzo said the county is currently $40 million in debt as a result of the pandemic. Without federal support, officials will be forced to seek tax increases, layoffs and alternative sources of revenue.
“We’re counting on the federal government to once again bail out the counties and the municipalities,” he said. “This is so important. If we do not receive that money it’s not going to be pretty.”
DiVincenzo said the $10 million Essex County received in CARES Act money did little in the way of paying off debt service and revenue losses. Virus testing, food distribution and rental assistance were covered by the funds, he said.
State Sen. Teresa Ruiz highlighted the myriad costs still left to fill for municipalities like Newark, where digital divide and other inequities are being exacerbated by the public health crisis. Come September, students across the state will return to school in person and online. Newark Public Schools still needs about 10,000 additional Chromebooks to ensure students have sufficient access to remote learning.
“The CARES money was a great start, but we need to advocate for resources that give all levels of government the flexibility to do what’s right on behalf of the people of the Garden State, of this country, of Essex County, and the city of Newark,” Ruiz said.