Porterdale, Georgia, might as well be named Everywhere, U.S.A. Its main street—aptly named Main St.—is lined with religious institutions. It has parks, a post office, and Waffle House.
And like almost every town right now, it’s facing brutally tough choices when it comes to its budget.
Porterdale has a deficit of about $1.2 million, nearly the same amount as its annual budget. Recent spending cuts led all of the town’s Public Works employees to quit. The interim city manager has even had to hit the streets to collect household garbage. He said he’s now trying to find a private sanitation company to hire.
This, after years of redevelopment that had seen the town thriving. Grants were secured to improve public parks. Free libraries were built at playgrounds. In 2018, Porterdale was named by Georgia Trend magazine as one of the state’s top three live, work, play small towns.
But a former city manager mismanaged town finances, confusing the city council about amounts for unpaid bills. And then coronavirus hit, striking a blow to tax revenue.
Porterdale is a glimpse of what towns and cities across the country will soon look like—if Congress doesn’t provide financial relief. And if states don’t start raising taxes on those who can afford it.
Consider the stakes: During the peak year of the Great Recession, states experienced a collective shortfall of more than $220 billion. One recent estimate has them facing a gap of at least $555 billion through the 2022 fiscal year.
Without more revenue, state and local governments will be forced to cut services and layoff teachers, sanitation workers, first responders, and other public workers. They already are. Oregon just slashed nearly $400 million from the state budget, mostly to human services—during a pandemic.
The path toward avoiding looming disaster is twofold: federal aid and progressive taxation.
Yes, state and local leaders should be demanding funding from Congress. But they also shouldn’t hesitate to increase taxes on households, businesses, and sectors of the economy that have continued to do well during the crisis. (Here are some policy ideas for how to do that.)
Unfortunately for Porterdale and towns across Georgia, the state government cut taxes for the richest residents in 2018 and planned to do so again until coronavirus hit.
It’s time for those who are thriving to help out those who are struggling to survive. No, it’s been time.