Many people are already feeling the economic impact that has come about as a direct result of the coronavirus pandemic. Social distancing mandates have resulted in the loss of jobs through layoffs, furloughs or the shuttering of several businesses.
As a result of this, according to the Associated Press, California could lose some $6.7 billion over the next two years across its 482 cities. And that staggering figure was compiled with the assumption that the state’s stay-at-home order would be lifted by June 1.
California, for its part, was the first to implement a stay-at-home order, effectively banning residents from leaving their homes unless absolutely necessary.
And as an early adopter to the strict measured need to curb the spread of the virus, it is looking increasingly unlikely that it will ease restrictions, as Gov. Gavin Newsom and health officials have already cautioned that social distancing guidelines and bans on unnecessary travel will likely continue into the summer.
Newsom noted that should he ease orders and allow people to pack beaches, parks and other public spaces, “I’ll be announcing in a week or so these numbers are going back up.”
“Obviously, the longer the stay-at-home orders are in place, the longer businesses are closed, the greater the revenue shortfalls will be,” Carolyn Coleman, the executive director of the League of California Cities, which compiled the projected data, told the Associated Press.
Local governments in California were allocated $5.8 billion in relief money as part of the $2.2 trillion coronavirus aid package. However, as the AP notes, most of that money went to counties, with only six cities qualifying due to having more than 500,000 residents. Those who did get the money could also only use it for coronavirus-related expenses, not to cover revenue loss.
The league is asking for the governor and the California Legislature to assist cities with this loss as we continue to move into an uncertain future.
Yountville Mayor John Dunbar noted that his city—located in the famed Napa County wine region—is expecting a 60 percent loss in revenue in the upcoming budget.
Despite the urgency to reopen businesses, Dunbar said, there will be no rush to do so given the crisis.
“We all agree that public health and our public health officers are rightfully driving the timing as we move forward,” said Dunbar, who is also president of the league.