Norton Working to Fix Second CARES Act Problem for D.C., Authorizing D.C. to Participate in Federal Reserve's Municipal Liquidity Facility

Statement

Congresswoman Eleanor Holmes Norton (D-DC) today announced she has requested that the next coronavirus response bill include her provision that would authorize the District of Columbia to participate in the Municipal Liquidity Facility (MLF) the Federal Reserve is establishing to support short-term borrowing by states, cities and counties in response to the coronavirus. D.C. is expressly authorized to participate in the MLF under the Federal Reserve's rules, but the D.C. Home Rule Act's borrowing provisions do not authorize D.C. to participate. The MLF is partially funded by the third coronavirus response bill, the CARES Act, meaning the CARES Act discriminated against D.C. twice, once intentionally and once inadvertently. The intentional discrimination occurred when Senate Republicans and the White House insisted on treating D.C. as a territory instead of a state in the Coronavirus Relief Fund, depriving D.C. of $755 million, even though D.C. is almost always treated as a state for federal funding.

"Fortunately, statehood is not required to remove the many limitations imposed by the Home Rule Act and other congressional acts on D.C. self-government," Norton said. "I do not believe Congress would oppose allowing D.C., on the merits, to participate in the Municipal Liquidity Facility at this unique moment in our nation's history."

Norton stressed that she is not pursuing the MLF fix because D.C. needs to or necessarily will participate in the MLF. Instead, she believes D.C. is entitled to the option to participate, like other jurisdictions, because D.C. is the equal of the states.

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