Katko’s bipartisan bill gives tax credits to state, local governments during pandemic

U.S. Rep. John Katko (R-NY) last week unveiled a bipartisan bill that would make state and local governments eligible for emergency paid family and sick leave payroll tax credits during the ongoing COVID-19 pandemic.

“By providing payroll tax credits to offset paid leave expenses, we will ensure local governments are able to protect employees and continue their work to serve our community through the duration of this crisis,” said Rep. Katko.

The congressman on Feb. 4 signed on as the lead original cosponsor of the Supporting State and Local Leaders Act, H.R. 786, with bill sponsor U.S. Rep. Bradley Schneider (D-IL). U.S. Sen. Tina Smith (D-MN) also on Feb. 4 introduced the companion bill, S. 262, in the U.S. Senate.

Under current law, public employers are not eligible to receive tax credits to offset the costs associated with providing emergency paid leave, thereby leaving already overburdened local governments with an additional expense to cover during the coronavirus public health emergency, according to Rep. Katko’s office.

“Since the start of this crisis, our local governments have played a key role in our pandemic response and recovery efforts,” said the congressman. “They have continued to provide essential services, supported healthcare providers, and relayed important information to keep our communities safe and healthy. 

“However, due to the economic impacts of this crisis, many local governments will soon be forced to make tough decisions if we don’t offer additional support,” he said.

H.R. 786 has been referred for consideration to the U.S. House Ways and Means Committee, while S. 262 is under review by the U.S. Senate Finance Committee.