The COVID-19 pandemic brought the nation’s economy to a standstill in just a few short months. Nearly all 50 states issued Stay at Home orders to combat the spread of COVID-19 in their states. Early on, AEM emphasized to Governors the vital role that the industry plays in national supply chains, especially during emergencies like the COVID-19 pandemic
State Finances in Trouble
States’ finances were not spared from harm from the widespread shutdown of states, and many face sharp decline in tax revenue needed to fund essential state services, such as education, healthcare, and public safety.
While some states enacted budget before the COVID-19 pandemic, others enacted stopgap temporary measures until the full impact of the shutdowns was known. The Council on State Governments estimates states will experience a combined $211 billion budgetary shortfall for their general funds. These general funds are used to fund essential services, such as state infrastructure projects, workforce development initiatives, and rural broadband expansion projects.
Governors’ New Budgets
Before the pandemic, Governors across the United States outlined ambitious plans to expand education programs and improve their states’ infrastructure. AEM was pleased to find that 22 Governors outlined specific programs to rebuild and repair critical infrastructure including roads, bridges, and broadband. The reality of declining state revenues forced Governors to cut back on key programs in order to focus on funding only essential services. We have already seen how spending cuts have forced planned construction projects to be put on hold or outright cancelled.
Rebuilding the Economy
The dramatic and rapid rise of unemployment has forced Governors to develop new programs to support their states economic recovery. Thankfully, many Governors recognize the important role our industry will plan in the longer-term recovery of their states. On a call with AEM Board members, Kansas Governor Laura Kelly said, “Equipment manufacturers currently play a central role in Kansas’ local economies, and will play a pivotal role in rebuilding Kansas’ economy.” AEM continues to support programs important for our members, such as workforce development programs, to develop our industry’s workforce.
Broadband Investment & Expansion Explosion
The recent reality of full-time working and learning from home showcased a new problem for states. The pandemic brought to light the serious deficits many rural communities face in reliable access to internet connectivity. In response to the crisis, many Governors have announced new broadband expansion programs to support these rural communities, recognizing the catalyst role broadband connectivity can play. AEM welcomed the opportunity to engage directly with key Governors to offer our support for new broadband expansion programs.
With states enacting painful budget cuts to plug massive deficits, AEM will continue to advocate to legislative leaders the importance of investment in infrastructure, workforce development programs, and broadband expansion.
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