State and Local Governments

By Skanda Amarnath Executive Summary The pricing of the Municipal Liquidity Facility (MLF) makes it virtually irrelevant for most municipal debt issuers because current market prices are well above those that the Federal Reserve (Fed) is offering. The success or failure of the MLF should be judged not solely by

The federal government should provide support to state governments during economic downturns in the form of block stabilization grants that serve to replace lost tax revenue.

State governments are on the front line of the COVID-19 pandemic and its economic fallout. The pace of the Federal response remains slow and local funding needs are still at risk of going unmet.