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Stimulus Bill Transforms Options For State and Local Governments


“When you make those types of decisions and you go against a party that I’m a part of, it does feel lonely,” said Mr. Dyer, a former Fresno police chief. “You start wondering along the way what kind of impact that could have on you in the future. But the reality is, I felt I was making the right decision for the right reason to benefit the people of Fresno, not necessarily a party.”

The aid will be distributed to states according to a formula that is based largely on the state’s unemployment rate, officials said. There are a host of rules on how the money can be spent. For example, the money can’t be used to pay down pension obligations or for cutting taxes.

Republicans in Congress argued that a funding formula based on unemployment instead of population benefits Democratic-led states and hurts Republican-controlled ones. One analysis from Representative Jason Smith, Republican of Missouri, found that 33 states were getting less money based on the unemployment formula, all but 10 of them led by Republican governors.

But many Democratic officials, and some Republican ones, disputed the notion of a partisan bailout.

“I think my residents know I don’t give a hoot about party — all I care about is making sure the street sweeper runs, the police show up and the water doesn’t stop,” said Acquanetta Warren, a Republican who is the mayor of Fontana, a working-class suburb east of Los Angeles set to receive $52 million.

Local governments have been hit harder than states. Three-quarters of the more than 1.3 million jobs lost among state and local governments since February 2020 have been at the local level, Mr. White of Moody’s found, the vast majority of them from school districts.

Counties, which are critical geographies for public services like emergency services, public health departments and local jails, were ecstatic. Many had complained that funds from previous rounds of pandemic stimulus had not reached them because the funds were routed through states for smaller counties. This time, the checks are coming directly from the United States Treasury Department.

The sheer size of the sums has shifted the scale of what is possible. Erie County, N.Y., which includes Buffalo, has for years struggled with barely functioning internet in its rural areas, which have been mostly bypassed by internet providers.

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