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Can Funding Counties Directly Help Them Overcome Their Biggest Problems?

Thousands of county officials came to Washington, D.C., to make the case with Congress that funding counties directly is the best way to improve lives across the country’s diverse rural and urban communities.

President Biden speaks to attendees at the National Association of Counties legislative conference on Feb. 12, 2024. (NACo)
In Brief:
  • The American Rescue Plan brought over $65 billion in federal funding directly to counties for them to use according to their assessment of local needs.
  • A new analysis of county finances finds that direct funding is the best way to ensure that federal funds are used to best advantage, given the widely varying population and economic trends in America’s more than 3,000 counties.
  • According to NACo, the demand side of county balance sheets is exploding. Even counties that are doing well financially are seeing needs in their communities outstrip their resources, particularly related to behavioral and mental health, substance abuse, homelessness, and housing affordability.

  • Federal funds are most effective if they come directly to counties, empowering them to use them according to their understanding of local conditions. That argument from the National Association of Counties (NACo) is a key takeaway from a published report released the day before the opening of its annual legislative conference.

    From Feb. 10-13, almost 2,000 county officials from 46 states were in Washington, D.C., for the conference to meet with members of Congress. “We’re not lobbyists,” says Mary Jo McGuire a commissioner in Ramsey County, Minn., and the current NACo president. Instead, county officials seem themselves as “intergovernmental partners,” fostering consensus and forward motion on issues of mutual concern.

    County governments have a unique ability to impact things that can either improve or undermine the stability of families and communities, from public health and public safety to parks, roads, libraries and mental health.

    In a conversation with Governing just before the conference, NACo leaders talked about present priorities for such cooperation, from Medicaid reform and election security to artificial intelligence and disaster preparedness.

    Governing: The post-COVID economy looks pretty good from a national perspective. How about the county level?

    Matt Chase, CEO, NACo: It's not monolithic; you are going to see variations across the country. One of the topics we are focusing on is that regardless of the revenue picture, the demand side of our balance sheet is exploding. Even counties that are doing better financially are seeing the needs of their communities outstrip their resources. We're talking about behavioral health and mental health, substance abuse, homelessness, housing affordability.

    A third of the counties are growing, a third are staying the same, a third are declining. Growth is expensive for the public sector. There's often a disconnect between a growing county economy and our ability to tax residents to keep up with the growth. More and more, state legislatures are trying to limit our ability to raise revenue.

    Mary Jo McGuire: We need investment from the federal government to come directly to us. If it comes through the state, it doesn't come as quickly or as equitably. We need direct funding to target the specifics of our work; we all do it a little differently.

    Denise Winfrey, board member, Will County, Ill., immediate past president, NACo: The $65.1 billion [in ARPA funding] that went to counties was essential for them to do the work they needed to do. Being able to direct programs to the immediate needs of residents is what is making a difference.

    Governing: What concerns do your members have about the coming election season?

    Chase: At this conference, we're bringing key federal officials, including from the U.S. Election Assistance Commission together with secretaries of state, county officials and Major Garrett from CBS News, who just wrote a book on elections. The focus is how we can have the right policies, the right equipment and the right volunteers trained to run a fair and honest election. We understand the political noise, but we're incredibly proud of the way counties bring together over 600,000 volunteers every election season and run the safest, best elections in the world.

    Winfrey: In my county we have put in new voting equipment, the result of ARPA funding. We have enhanced our sheriff's department, so we have workers at all the polling places. We have more polling places, and people can vote on the weekends. We’re making sure that people are aware that they can vote everywhere and doing a lot of work with high schools, having youth work as adjuncts to clerk’s offices and helping them register people who will become of age in time to vote.

    Governing: In some ways, the biggest challenges seem to be in dealing with the new communications ecosystem. Are you talking to election officials about how they can keep ahead of misinformation?

    J.D. Clark, county judge, Wise County, Tex., second vice president, NACo: There are a lot of different examples in counties across the country. In our community, we're doing a lot of public outreach, meetings with our Lions or Rotary clubs. We’re creating opportunities for people to get to know the staff in our elections office, to see the equipment, do some sample ballots, understand how the process works, how the technology works, why it's secure and to create community buy-in into the process, the system and the professionals who carry out elections. When they go post their ballot, they understand the work that's gone into it and the process that's in place and they trust the system.

    Governing: Disaster preparedness is one of the focal points for this conference. Storms, fires and floods are bigger and more frequent — how can counties keep up?

    McGuire: People from the private sector, the public sector, nonprofits and the Pew Charitable Trusts are here with us for a disaster resiliency forum. We're in our third phase of identifying what's going on and how we can get communities better able to handle these disasters. We can't control them all, but we can be more ready for them. NACo has published reports from the first two events.

    Chase: In 2023, we had 28 separate disasters, estimated to have caused about $93 billion in damages. Last year, 850 counties had a presidential disaster declaration. That’s not sustainable. Counties are property tax-based government, and we're looking at what is happening in the private insurance markets. When companies pull out, what does that do to the value of commercial and residential properties? If homes or businesses decline in value, that harms our tax base and the wealth of residents and businesses.

    Governing: Are “green infrastructure” systems that can keep more stormwater away from homes and businesses a bigger priority in the face of the rising frequency of floods?

    Chase: Green infrastructure ties into our focus on housing affordability. We need to invest in pre-disaster mitigation, but it's really expensive. Solutions like green infrastructure drive up the cost of building. Do you pay now, or do you pay later? Those are classic public-policy discussions.

    Governing: The Affordable Connectivity Program has expired. Why is it important for Congress to re-fund it?

    Clark: There are historic levels of investment in broadband infrastructure happening all across the nation to reach unserved and underserved communities. But it doesn't do you a lot of good that the Internet is available and people can't afford it. We need to see that funding program extended.

    McGuire: It really impacts our kids and puts them on an uncompetitive level if they don't have access to the Internet.

    Chase: There is a huge equity discussion around access and AI. Whether it's in the workforce or in a school, if you don't have Internet connectivity, you can't use advanced AI tools. They help with learning, with disability. For underserved communities to stay current in this rapidly evolving economy, broadband access has to be affordable — and it needs to be accessible to all, just like water, sewer and roads.

    Governing: Drug overdose deaths continue to rise, mostly due to opioids. What are county governments doing to address this problem?

    Nicole Weissman, director of strategic communications, NACo: Eighty percent, 80 percent of county economies face negative impacts as a result of substance abuse. NACo has been deeply involved in mental and behavioral health as areas that sit very much at intersections of county responsibilities.

    Teryn Zmuda, chief economist, NACo: Our Opioid Solutions Center has worked with the Centers for Disease Control and Prevention and other partners to uplift best practices for the use of $26 billion in opioid settlement funds ceded to counties. We have focused on evidence-based practices, including medication-assisted treatment for opioid use disorder and naloxone access.

    Governing: Are there places where deaths have gone down because of these kinds of things?

    Chase: Absolutely. There are counties such as Erie County, N.Y., that are working with hospitals, community partners, the faith-based community, schools. We are trying to focus on both supply and the demand. The media focuses a lot on supply and suppliers. We’re working on that with law enforcement, but we've got to cut down on demand. That’s what the opioid center is working on — how do we help educate folks about how lethal these new drugs are?

    Clark: There’s not a one-size-fits-all answer. It's 1,000 different options based on what a community has available and is facing. That's why it's not just the NACo officers out here to meet with our federal partners. It's 2,000 county officials who have come to tell their stories, tell what's worked at home and to help our federal partners see that counties know the nuances of their communities and what's likely to be effective.

    Governing: What do you want to see in regard to Medicaid reform?

    McGuire: When people come into our county jails they lose their Medicaid, without being convicted or even charged. We have to pay for their care, which is a huge burden. When they go back into the community, they have to re-enroll. If they don’t, that can contribute to increases in drug abuse, mental health problems and homelessness. If we could get Congress to continue their Medicaid coverage while they're in our jails, that would be helpful.

    Chase: Medicaid limits coverage for mental health and substance facilities to those with a maximum of 16 beds, which makes it difficult for us to treat the numbers we have. If there is nowhere to go, the options for crisis stabilization are ERs and jails. We're trying to build crisis stabilization centers, but how do you pay for them? We're asking for Congress and the White House to treat physical health and mental health the same way. We want insurance providers to cover mental health. We’re building these programs, but we don't have a public or a behavioral health workforce to staff facilities. We're looking at ways to create better public policy around helping folks who want to get into this field.
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    NACo worked with the civic education nonprofit iCivics to develop a video game that gives students (or other players) a chance to see what it's like to run a county government.
    Governing: People trust local government the most, but those who generally dislike government are noisier than ever. Are you doing anything about this?

    McGuire: Civic education and civic engagement — helping the public understand what counties do, why it's important and how they can help us — is a big priority. We partnered with [the educational nonprofit] iCivics and the late Sandra Day O’Connor to create a curriculum for grades 6-12 and an online game, “Counties Work.”

    We need more workers. In Ramsey County, we have an internship program that brings in high school students to work in our departments. We hope they’ll come work for us when they learn what we do.

    Carl Smith is a senior staff writer for Governing and covers a broad range of issues affecting states and localities. He can be reached at or on Twitter at @governingwriter.
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