On Tuesday, Representative John Garamendi (D-Yolo) introduced the Special Districts Provide Essential Services Act (H.R. 7073). Currently, special districts are ineligible for direct federal financial assistance under the CARES Act. Representative Garamendi’s legislation would ensure that the 2,700 special districts in California and 30,000 special districts nationwide are eligible for any additional federal assistance provided by Congress to state, county, and local governments to aid in the fight against COVID-19. Special districts are units of local government that provide public services cities and counties do not provide for residents. Those services include first responders, firefighting, public health, transit, and more.

Specifically, the “Special Districts Provide Essential Services Act” would provide:

  • Eligibility for Coronavirus Relief Fund and Future Federal Assistance: Make special districts eligible for direct federal financial assistance appropriated by Congress in the future, along with state, county, and local governments and subject to the same oversight requirements. This would not apply retroactively to the $150 billion provided under the CARES Act.
     
  • Access to Municipal Liquidity Facility: Provide special districts access to the Federal Reserve’s Municipal Liquidity Facility, which provides states, counties, and cities federally guaranteed “bridge financing” to offset unexpected short-term revenue shortfalls caused by the current pandemic. Like states, counties, and cities, many special districts serve large populations and have the legal authority to issue short-term tax and revenue anticipation notes. However, special districts are not currently granted direct access to the Municipal Liquidity Facility.
     

While RCRC does not officially ‘support’ H.R. 7073, RCRC’s federal advocacy team has been working with Congressman Garamendi’s office and one of the key sponsors – the California Special Districts Association – on crafting the bill. We appreciate that supporters of this legislation are sensitive to the financial plight that counties are experiencing in using county resources to providing direct public health care services while at the same time experiencing great revenue loss during the pandemic.