What's in the Disaster Aid Package for States and Localities?

BY LIZ FARMER | JUNE 4, 2019 AT 1:10 PM

After months of delay, Congress passed a $19 billion aid bill on Monday to help places recover from natural disasters that have struck over the last two years -- and to help cover costs of the ones yet to come.

As the political infighting wore on this year, more natural disasters -- such as flooding in the Midwest and tornadoes in the South -- bumped up the price of the legislation by roughly $5 billion. It’s now one of the most sweeping disaster aid packages ever passed and heads to President Trump for his expected signature.

Are Tech Tax Breaks Obsolete?

BY LIZ FARMER | MAY 31, 2019 AT 4:00 AM

In the tech world, most believe that the key to success is quickly adapting to change. Some cities are applying that idea to the tax incentives they give technology companies.

This week, Washington, D.C., drastically cut a tech tax break that has been in place since 2000. Earlier this month, San Francisco -- home to some of the world's biggest tech companies -- let its eight-year-old "Twitter tax incentive" expire.

The Baltimore Cyberattack Highlights Hackers' New Tactics

BY LIZ FARMER | MAY 30, 2019 AT 5:21 PM

Cyberattacks on local governments are on the rise -- and they’re becoming more sophisticated. The latest case in Baltimore, where the city is still struggling to restore critical networks more than three weeks after being hacked, could be a harbinger of things to come.     

Already this year, at least 24 municipalities have reported ransomware attacks, including Amarillo, Texas; Augusta, Maine; Imperial County, Calif.; Garfield County, Utah; Greenville, N.C.; and Albany, N.Y. That’s on pace to surpass last year’s total of 53, according to data collected by the tech company Recorded Future.

How Federal Tax Reform Has Impacted Real Estate

BY LIZ FARMER | MAY 20, 2019 AT 4:00 AM

A year ago, the new $10,000 cap on the federal deduction for state and local taxes prompted dire predictions for the real estate market, especially in expensive areas like New York and San Francisco.

In these and other high-tax places, local property taxes alone can cost more than $10,000 a year. Many finance experts warned that limiting what these residents could deduct from their local taxes would lower home values and hurt governments' property tax revenue along with it.

As it turns out, those predictions were wrong -- at least on a large scale.

How Can a City Issue Pay Raises and Layoff Notices in the Same Week?

BY LIZ FARMER | MAY 10, 2019 AT 4:00 AM

Houston’s standoff over pay parity between firefighters and police officers is coming to a crescendo after more than a year of legal battles and political posturing.

This week, thousands of firefighters received pay raises thanks to a voter-approved law to give them equal pay compared with police officers of the same rank.

But no one’s celebrating.

Pensions Have Tripled Their Investment in High-Risk Assets. Is It Paying Off?

BY LIZ FARMER | MAY 8, 2019 AT 4:00 AM

Public pensions are more invested than ever before in high-risk and expensive assets like real estate and hedge funds. Yet research continues to show that this tactic is unlikely to improve their earnings.

According to Fitch Ratings, in the span of a decade, pensions tripled their average investment in these so-called alternative investments. In 2007, they averaged 9 percent of state and local public pension investment portfolios. By 2017, that number had risen to 27 percent.

Should Big Tech Be Taxed for Using Our Data?

BY LIZ FARMER | MAY 3, 2019 AT 4:00 AM

Tech companies have gotten really good at tracking our online behavior and placing ads tailored to our interests. They make billions of dollars doing so, and for years, there have been calls for governments to take a cut of the action.

Most recently, California Gov. Gavin Newsom called for a "data dividend," saying that “consumers should also be able to share in the wealth that is created from their data."

But as one lawmaker in New York is finding out, implementing a data tax on big tech has some complications.

States Want Trump to Release His Tax Returns. What About Governors?

BY LIZ FARMER | APRIL 25, 2019 AT 4:58 PM

As the 2020 election approaches, states are ramping up efforts to require presidential candidates -- including Donald Trump -- to disclose their tax returns.

A total of 18 states this year, including Trump’s home state of New York, have considered bills that would require such a disclosure in order to appear on the ballot, according to the National Conference of State Legislatures. The push comes as the administration fights a Democrat-controlled House committee’s subpoena for Trump’s tax and financial records.

'Investors Are Hesitant': Rural America Might Miss Out on 'Opportunity Zones'

BY LIZ FARMER | APRIL 19, 2019 AT 4:00 AM

This week, the federal government released new guidelines for the nation’s more than 8,700 "opportunity zone" communities trying to attract venture capital investment and boost their struggling economies.

Rural areas account for 40 percent of the designated opportunity zones, which offer private companies and investors tax breaks in exchange for investing in certain low-income communities. But some warn that even with the tax incentives, many rural areas still likely won't benefit unless state and local governments intervene to make the investment less risky.

The Key to Predicting the Next Teacher Strike

BY LIZ FARMER | APRIL 17, 2019 AT 4:00 AM

Teaching isn't a lucrative profession practically anywhere in America, but what drives some educators to strike over their pay and others to accept it?

It likely won't come as a surprise that, according to a new analysis, most of the places with the lowest pay have recently been home to walkouts or strikes. The data also suggests that the action in some states is having a spillover effect in others.

Federal Tax Reform May Be Saving Money for States, Even High-Tax Ones

The part of the 2017 law that high-tax states are battling in court is likely helping them lower their debt -- at least in the short-term.

BY LIZ FARMER | APRIL 12, 2019 AT 4:00 AM

Many states that lobbied against federal tax reform’s limit on a certain tax deduction are now benefiting from a potential effect of that 2017 policy change.

Tax reform capped the state and local taxes (SALT) that filers can deduct from their federally declared income at $10,000. High-tax states like California, New Jersey and New York have sued to block that change because their state and local taxes can be twice that amount for residents.

Cities and Pension Funds Are Suing Big Banks (Again)

BY LIZ FARMER | APRIL 5, 2019 AT 7:05 AM

Baltimore has filed two antitrust lawsuits in eight days, alleging price-fixing by big banks and hoping to turn both proceedings into class action suits that seek billions in damages for governments and pension plans.

The suits address two different kinds of municipal market bonds, but both levy the same charges: that banks manipulated interest rates to their advantage, at the expense of taxpayers.

The Economy Is Growing, But Many People Aren't Feeling the Benefits

BY LIZ FARMER | APRIL 3, 2019 AT 4:00 AM

In the decade since the Great Recession, most cities have recovered. But even in places that have bounced back -- some stronger than before -- many people are still struggling.

new report by the Brookings Institution outlines how the economic expansion over the last decade has been a lopsided one marked by growing income inequality, wage stagnation and racial divides.

Why Billions in Disaster Recovery Remain Unspent for 2017 Hurricanes

BY LIZ FARMER | MARCH 29, 2019 AT 4:00 AM

Historic flooding in the Midwest has left millions of acres under water in 10 states after a "bomb cyclone" storm brought heavy snow and drenching rains. And it’s far from over. Weather forecasters say more precipitation is on the way.

The task list for the cleanup and recovery is already mounting. So far, the floods are affecting the safety of more than a million private water wells; farms won’t be able to plant crops this year; and Superfund waste sites are inaccessible.

And when it comes to getting the money to rebuild, states and localities in the Midwest likely have a long wait ahead of them.

Trump More Than Doubled Funding for the Opioid Crisis. How's It Being Spent?

BY LIZ FARMER | MARCH 27, 2019 AT 2:15 PM

Federal funding to combat the opioid crisis more than doubled last year, marking an important commitment to prevention, treatment and recovery. A new report looks at whether and how that extra $4 billion is being effectively spent.

In 2017, more than 70,000 people in the United States died from a drug overdose; almost 50,000 of those deaths involved an opioid. In 2018, the Trump administration increased opioid funding to states to more than $7 billion, from a little more than $3 billion in 2017.

Momentum for Fixing Marijuana's Banking Problem Is Higher Than Ever

BY LIZ FARMER | MARCH 22, 2019 AT 4:00 AM

New Jersey will likely be the next to legalize recreational marijuana, which would make it the 11th state (plus the District of Columbia) to do so. Medical marijuana is legal in an additional 22 states, meaning that more than half the country permits some form of the drug.

And yet, most growers and sellers can’t get a bank account for their business.

Do Corporate Tax Incentives Work? 20 States, and Most Cities, Don't Know.

BY LIZ FARMER | MARCH 20, 2019 AT 4:00 AM

The aircraft manufacturer Boeing has received roughly $1 billion in tax incentives and credits from Washington state over the past four years. That includes tens of millions of dollars for activities in 2017 related to production equipment for the 737 MAX jets, all of which have been grounded in the past week after two fatal crashes.