Special Briefing

The US economy’s extraordinary recovery since the darkest days of the COVID-19 pandemic has continued into the fall of 2025, with inflation retreating and the Federal Reserve cutting interest rates to keep jobs and investment humming along. Our expert panel discusses where the economy is growing fastest—and less fast—and what this means for state and local budgets and finances.

Our panel of experts includes Rochester (Minnesota) Mayor Kim Norton, Georgia State Economist Robert Buschman, Fitch Ratings head of US State ratings Eric Kim, and PIMCO Senior Vice President Tom Schuette.

Notable Quotes:

“We were very pleased that money came directly to the cities and local jurisdictions, so we didn’t have to go through a lot of time to get it through the state. It was very beneficial to get that money into our communities quickly, starting with ARPA and then the CARES Act funds.” - Mayor Kim Norton

“Since the last quarter before the pandemic, Q4 2019, Georgia real GDP growth has run 2.4% per year, on average, slightly better than the 2.3% average for the nation. And though we had our own soft landing in the first half of 2023, we’re up 3.5% since then, compared to 3% for the nation. Job growth has also outpaced the nation for most of the expansion.” - Bob Buschman

“Growth coming out of the pandemic has been very robust nationally, so strong in fact that it beats expectations month after month, quarter after quarter, year after year. I think most economists were anticipating a recession for about two years before finally giving up and accepting that the economic growth was simply going to continue, even with the Federal Reserve ratcheting up interest rates above 5%.” - Eric Kim

“I think in 20-plus years doing this at a rating agency and also on the buy side, I would argue that I’ve never seen the public sector so well-prepared for any turbulence or volatility on the revenue or expenditure side as they are right now.” - Tom Schuette

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Learn more about the Volcker Alliance at: volckeralliance.org

Learn more about Penn IUR at: penniur.upenn.edu

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Special Briefing is published by the Volcker Alliance, as part of its Public Finance initiatives, and Penn IUR. The views expressed on this podcast are those of the panelists and do not necessarily reflect the position of the Volcker Alliance or Penn IUR.

Listen in to this episode of Special Briefing as Bill Glasgall of the Volcker Alliance, Susan Wachter of the Penn Institute for Urban Research (Penn IUR), and our panel of experts discuss the year ahead for America’s states and municipalities. Fiscal 2025 will be an especially consequential one, with the Federal Reserve expected to cut interest rates for the first time in almost five years as inflation and the economy cool; the impending end of federal emergency pandemic aid; and, of course, the likely consequences of the November presidential and congressional elections.

Our panel of experts includes Vikram Rai, head of municipal markets strategy, Wells Fargo; Jane Ridley, managing director and local government sector leader, S&P Global; Matthew Stitt, managing director, PFM's Management and Budget Consulting team, and former CFO, Philadelphia City Council; and Mark Zandi, chief economist, Moody’s Analytics.

Notable Quotes:

“There's much to be optimistic about all the business formation that we've seen since the pandemic hit, and that generally means more innovation and more productivity gains. So if I were a prudent planner I would count on a 10-year treasury yield, which is the benchmark for all of the borrowing of state and local governments, but [I think we will be] somewhere around four to four and a half percent.” - Mark Zandi

“S&P is projecting the same kind of expectation in terms of where the national economy is going, so that provides a stable spot for governments. And regardless of whether or not it is a strong economy or a weak one, proactive management and strong governance is really what we see across this sector too.” - Jane Ridley

“A lot of local governments have had their sights on the dwindling of federal funds. They’re coming up with newer baselines as we’re starting to see what the recovery of downtown looks like after the pandemic, in terms of buildings and occupancy rates of commercial buildings – some of that is starting to be baked into projections going forward.” - Matt Stitt

“There are worries about interest rate volatility or even a rate sell off. Because despite the fact that the cut is very large, the worry is that if inflation comes back because they cut too much too quickly, then there's a rate sell off, and that's why the market has to settle down. So these worries about a great volatility or a sell off could keep investors on the sidelines a little longer.” - Vikram Rai

Be sure to subscribe to Special Briefing to stay up to date on the world of public finance.

Learn more about the Volcker Alliance at: volckeralliance.org

Learn more about Penn IUR at: penniur.upenn.edu

Connect with us @VolckerAlliance and @PennIUR on Twitter, Facebook and LinkedIn

Special Briefing is published by the Volcker Alliance, as part of its Public Finance initiatives, and Penn IUR. The views expressed on this podcast are those of the panelists and do not necessarily reflect the position of the Volcker Alliance or Penn IUR.

On this episode of Special Briefing, experts discuss the latest Volcker Alliance issue paper, Benefit or Burden: Evaluating $1 Trillion in State Tax Expenditures. The issue paper addresses how US states hand out massive tax breaks every year to advance policy goals, such as aiding low-income families, spurring business investment and job creation, or mirroring the federal tax code. Known broadly as tax expenditures, these exemptions, credits, abatements, and other measures reduce state revenues by an estimated $1 trillion a year, almost three times their 2021 total state expenditures on education. Such tax expenditures, which often suffer from lax government oversight, may be leaving states short on revenue at time when the effects of climate change and the cost of deferred maintenance means that they will need to spend more on infrastructure now and in the decades ahead.

Our panel of experts includes one of the issue paper's authors, Matt Fabian, partner, Municipal Market Analytics; as well as Jonathan Ball, legislative fiscal analyst, State of Utah; Tim Bartik, senior economist, W.E. Upjohn Institute for Employment Research; and Arlene Martinez, deputy executive director, Good Jobs First.

Notable Quotes:

“We went into this project expecting a mess. It was much worse than that. We're not even advocating for true, actual public disclosure of the information. We just want states to get their arms around what it is they're doing.” - Matt Fabian

“I would also make sure that before you massively fund tax breaks, that you fund infrastructure and job training which evidence suggests is more cost effective in creating jobs than some of these tax breaks. States need to fund more programs where community colleges will train workers for companies so they can make sure they have the labor and the real estate they need.” - Tim Bartik

“I was a journalist for many years, reporting a lot on local spending and budgets, and I could see what would happen when communities were strapped for cash. The programs that often got cut were often programs that targeted low-income folks or vulnerable people, because they tended to have less of a voice in the process.” - Arlene Martinez

Be sure to subscribe to Special Briefing to stay up to date on the world of public finance.

Learn more about the Volcker Alliance at: volckeralliance.org

Learn more about Penn IUR at: penniur.upenn.edu

Connect with us @VolckerAlliance and @PennIUR on Twitter, Facebook and LinkedIn

Special Briefing is published by the Volcker Alliance, as part of its Public Finance initiatives, and Penn IUR. The views expressed on this podcast are those of the panelists and do not necessarily reflect the position of the Volcker Alliance or Penn IUR.

Ever since the arrival of the COVID-19 pandemic in the US in 2020 led to a surge in people working from home, New York and other big cities have been forced to reckon with the possibility of a Doom Loop scenario of vacant offices and flagging economies. But given the right set of policies, cities can reverse their fortunes and embark upon a path to a Boom Loop of greater productivity and economic growth. Join Special Briefing as the authors of the Volcker Alliance issue paper, Doom Loop or Boom Loop: Work from Home and the Challenges Facing America’s Big Cities, and an expert panel discuss the future economic impacts of remote work.

Our panel of experts includes the paper’s authors, David Stanek, vice president, and Richard Voith, founding principal, Econsult Solutions Inc.; as well as Jose Maria Barrero, assistant professor, Instituto Tecnológico Autónomo de Mexico; Stijn Van Nieuwerburgh, professor of real estate, Columbia Business School; and Kathryn Wylde, president and chief executive officer, Partnership for New York City.

Notable Quotes:

“Work from home poses a direct and serious challenge in New York City, especially in the commercial office sector and public transportation, but work from home also potentially offers great opportunities for the city.” - Dick Voith

“San Francisco is the ‘poster child’ for a difficult post-pandemic recovery, meanwhile Miami has gained upwards of 100,000 jobs since the pandemic.” - David Stanek

“Recently, we've asked a series of qualitative questions in our surveys, asking people about returning to the office. What draws them to the office? Many firms said that they've done several big pushes to return to the office, which I think gives you a sense of how difficult it is for certain organizations, especially in knowledge work industries, to bring their people back,” - Jose Maria Barrero

“Employers’ real estate commitment to New York City is extremely positive. More than half are committed to at least maintaining their current footprint, more than 30% have actually increased or anticipate increasing their footprint in the next year, and only 10% are looking at reducing their footprint.” - Kathryn Wylde

“We need to convert brown offices to green apartments, in a nutshell. Of course, there are both regulatory and financial obstacles to conversion. We've come to the conclusion that roughly 10% of the office stock is readily convertible based on its physical characteristics. In cities like New York or Chicago, where we have an older office stock, that number is probably closer to 30%.” - Stijn Van Nieuwerburgh

Be sure to subscribe to Special Briefing to stay up to date on the world of public finance.

Learn more about the Volcker Alliance at: volckeralliance.org

Learn more about Penn IUR at: penniur.upenn.edu

Connect with us @VolckerAlliance and @PennIUR on Twitter, Facebook and LinkedIn

Special Briefing is published by the Volcker Alliance, as part of its Public Finance initiatives, and Penn IUR. The views expressed on this podcast are those of the panelists and do not necessarily reflect the position of the Volcker Alliance or Penn IUR.

While the 2021 Bipartisan Infrastructure Law provides $50 billion to upgrade America’s drinking water, wastewater, and stormwater systems, much more will be needed to address the nation’s water infrastructure needs amid a changing climate and shifts in population. The Environmental Protection Agency estimates the US will need almost $900 billion in water investment over the next twenty years, plus hundreds of billions more for maintenance. These sums will burden federal, state and local budgets but also pose new opportunities—and risks—for investors in water projects.

Our panel of experts includes Senator Bill Bradley, former United States Senator, D-NJ; Doug Evanson, executive vice president and chief financial officer, San Antonio Water System; Howard Neukrug, executive director, The Water Center at the University of Pennsylvania; Nicole Lick, senior life scientist, water division, United States Environmental Protection Agency Mid-Atlantic Region; and Reese Tisdale, president and chief executive officer, Bluefield Research.

Notable Quotes:

“There was bipartisan support for the infrastructure bill, and so this is a matter of modifying and taking that support and moving into something even more critical than roads and bridges –– our supply of water to areas of the country that don't have it.” - Senator Bill Bradley

“It's amazing how much the water industry has changed in the last ten years and certainly 20 to 30 years looking back, but the concept of reusing water, particularly in the West and other parts of the world, is… new… it’s a technology that's growing.” - Howard Neukrug

“The VISTA Ridge water supply project [in San Antonio] has been recognized nationally as one of the largest public-private partnerships to be constructed in North America....The project is essential for San Antonio meeting its demand requirements in 2023 and could not have been completed without the public-private partnership structure.” - Doug Evanson

“Ever since the Clean Water Act, since 1976, federal funding towards the water sector has shifted away from 15% to 5% now. [That funding gap] has been pushed on the local communities and local governments to address the challenges that they face.” - Reese Tisdale

“52 years ago, the Clean Water Act resulted in $200 billion in federal water infrastructure investments over a 10-year period, and that investment was incredibly successful in cleaning up our water.... But it also means that our water infrastructure is aging and nearing the end of its lifespan and requires upgrades or replacement.” - Nicole Lick

Be sure to subscribe to Special Briefing to stay up to date on the world of public finance.

Learn more about the Volcker Alliance at: volckeralliance.org

Learn more about Penn IUR at: penniur.upenn.edu

Connect with us @VolckerAlliance and @PennIUR on Twitter, Facebook and LinkedIn

Special Briefing is published by the Volcker Alliance, as part of its Public Finance initiatives, and Penn IUR. The views expressed on this podcast are those of the panelists and do not necessarily reflect the position of the Volcker Alliance or Penn IUR.

Western and southern states including Idaho and Florida were among those growing the fastest from the eve of the pandemic in 2019 through 2022. But there were some surprises as well, with Delaware, Maine, and New Jersey also joining the Census Bureau’s hot growth list. While the ability of many Americans to move to low-tax states and work from home played a large role in the population shift, other factors may have been at play as well. Meanwhile, rapid population expansion poses challenges in many of these states as they cope with enlarging school systems, updating infrastructure, and preparing communities for the impact of extreme weather conditions. Our expert panel explores these issues and what they may portend for state and local finances.

Our panel of experts includes New Jersey Governor Phil Murphy; Alex Adams, chief budget officer, state of Idaho; Shatakshee Dhongde, professor of economics, Georgia Institute of Technology; Thomas Doe, president, Municipal Market Analytics, Inc.; and Torsten Slok, chief economist, Apollo Global Management.

Notable Quotes:

“I use two words: talent and location. Historically, when New Jersey invested aggressively in talent and location, it did well –– and when it didn't –– it did poorly. It's really not a political ideology, it's playing the hand that you were dealt.” - Governor Phil Murphy

“But the big picture is: tax revenue is still good, and we still have a good economy… with the little caveat that the cost of borrowing will remain elevated, probably for another six-to-nine months.” - Torsten Slok

“A lot of [why we’re growing] is that we are a low-regulated state. This is the least regulated state in the country, we're also a low taxation state… we’re stable financially, and then there's all those intangible benefits and tangible benefits as we have access to outdoor recreation, beautiful lakes, mountains, access to skiing –– things that were really rejuvenating for many people during COVID.” - Alex Adams

“We talk a lot about pensions, but here in Texas, there are also going to be increased costs because of the changing climate, whether it's the electricity, water, the airport, or highways. You just are taking abuse from extraordinarily volatile weather conditions that are now commonplace.” - Thomas Doe

“A recent report by the Federal Reserve Bank of Atlanta showed that the Southeast region, which consists of Alabama, Florida, Georgia, Louisiana, Mississippi and Tennessee, grew around 0.2 percentage points per year faster than the United States in most major metrics of economic performance.” - Shatakshee Dhongde

Be sure to subscribe to Special Briefing to stay up to date on the world of public finance.

Learn more about the Volcker Alliance at: volckeralliance.org

Learn more about Penn IUR at: penniur.upenn.edu

Connect with us @VolckerAlliance and @PennIUR on Twitter, Facebook and LinkedIn

Special Briefing is published by the Volcker Alliance, as part of its Public Finance initiatives, and Penn IUR. The views expressed on this podcast are those of the panelists and do not necessarily reflect the position of the Volcker Alliance or Penn IUR.

With their revenues and cash reserves at record highs after unprecedented federal aid to offset the impact of COVID-19, dozens of states embarked on the biggest wave of tax cuts in decades, slashing levies by at least $124 billion on everything from personal income to groceries and gasoline. Tune into this Special Briefing as the authors of the forthcoming Volcker Alliance issue paper, State Tax Cuts after the Pandemic: Strategies to Sustain Fiscal Health, and an expert panel discuss whether these reductions can be sustained as revenues have begun to weaken despite the strong US economy.

Our panel of experts includes the paper’s authors Can Chen, associate professor, Andrew Young School of Public Policy at Georgia State University (GSU), and Alex Hathaway, senior research associate, Center for State and Local Finance at GSU; as well as Geoffrey E. Buswick, managing director and government sector leader, S&P Global Ratings-US Public Finance; and Natalie Cohen, founder and president, National Municipal Research.

Notable Quotes:

“When governments use one-time budget surpluses for permanent tax cuts, they may face long term budget challenges. This is why we wanted to specifically look at the long term fiscal implications of permanent expansions of tax cuts.” - Can Chen

“States that have opted for permanent tax cuts recently could face depleted safety net funds and less generous aid in the future. Our report proposes four strategies that states can consider going forward when they implement future tax reductions.” - Alex Hathaway

“As the paper highlights, thanks to a stronger than projected growth across many revenue streams the past few years and the ability to build the reserves to all time levels — typically well above policy — most states passed tax cuts and relief in some form.” - Geoff Buswick

“You never know when that black swan event is going to hit, whether it's climate change or some major crisis in the world, geopolitical issues can rear their heads and suddenly put a state on its back foot in terms of revenue changes.” - Natalie Cohen

Be sure to subscribe to Special Briefing to stay up to date on the world of public finance.

Learn more about the Volcker Alliance at: volckeralliance.org

Learn more about Penn IUR at: penniur.upenn.edu

Connect with us @VolckerAlliance and @PennIUR on Twitter, Facebook and LinkedIn

Special Briefing is published by the Volcker Alliance, as part of its Public Finance initiatives, and Penn IUR. The views expressed on this podcast are those of the panelists and do not necessarily reflect the position of the Volcker Alliance or Penn IUR.

For America’s states and municipalities, 2024 is likely to bring long-awaited relief from inflation and higher interest rates while presenting challenges—and not just because it’s a presidential election year. States, cities, and counties will have to contend with the imminent end of $350 billion in federal pandemic budget aid even as the revenue boom of recent years cools and the need for increased spending to ameliorate the risks of a changing climate put pressure on infrastructure spending. Listen in as our panel of experts discuss strategies that state and local governments are adopting to meet these challenges.

Our panel of experts includes Clarence Anthony, CEO and executive director, National League of Cities; Mayor Kim Norton of Rochester, Minnesota; Mark Ferrandino, director, Colorado Office of State Planning and Budgeting; Eric Kim, senior director, Fitch Ratings; and Mark Zandi, chief economist at Moody’s Analytics.

Notable Quotes:

“There is a lot on the plates of local leaders, but city leaders are also resilient and optimistic, and they're determined to build their communities back better than ever before, in tandem with their state and federal partners.” - Clarence Anthony

“Obviously, there are lots of risks… there are things that can go off the rails, but I will say that for the first time in a long time, the risks are more symmetric.” - Mark Zandi

“We're a town of about 124,000 people and we’re home in Minnesota to the state's largest employer, which is the Mayo Clinic, and we are pleased to say that our local economy has rebounded fairly well from the pandemic.” - Mayor Kim Norton

“We definitely see some headwinds in terms of revenue for the next year, but long term, we see continued growth. We also see the demand on those revenues and the demand on the state government to just continue to grow.” - Mark Ferrandino

“In December, our economics team published its quarterly global economic outlook. And as we were just talking about, 2023 was a surprisingly good year. So good, in fact, that Fitch took off its recession forecast for 2024 in our last update, [and] we were one of those many in the consensus that we're expecting a recession, but we've pulled back on that.” - Eric Kim

Be sure to subscribe to Special Briefing to stay up to date on the world of public finance.

Learn more about the Volcker Alliance at: volckeralliance.org

Learn more about Penn IUR at: penniur.upenn.edu

Connect with us @VolckerAlliance and @PennIUR on Twitter, Facebook and LinkedIn

Special Briefing is published by the Volcker Alliance, as part of its Public Finance initiatives, and Penn IUR. The views expressed on this podcast are those of the panelists and do not necessarily reflect the position of the Volcker Alliance or Penn IUR.

Many states, counties, and cities emerged from the COVID-19 pandemic and resulting recession with record cash reserves following the US government’s injection of $5 trillion to revive the economy and prop up local government budgets. But even after the unprecedented federal support, states and municipalities have been left with more than $1.3 trillion in unfunded liabilities for public employee pension benefits that were promised but are not fully funded. Join our panel of experts as they discuss strategies that state and local governments are adopting to reduce this pension burden and whether they may have to reduce spending for education, infrastructure, and other critical public services to make room for increasing retirement contributions.

Our panel of experts includes Liz Farmer, public finance journalist and co-host of the Public Money podcast; Vedanta Goenka, senior municipal strategist, Citigroup; Merl Hackbart, professor emeritus, Martin School of Public Policy and Administration, University of Kentucky; Shoaib Khan, director, New Jersey Treasury Division of Investment; Anthony Randazzo, executive director, Equable Institute; and Les Richmond, vice president and actuary, Build America Mutual.

Notable Quotes:

“We have a target of approximately 30% of the [pension] portfolio to alternative asset classes,” - Shoaib Khan.

“Our top assessment from a 50 state review of data is that funding strategies for public plans have significantly improved whether we look at the last five years or the last 15 years,” - Anthony Randazzo

“As far as pension funding is concerned, we–– as Anthony mentioned –– have seen a tremendous improvement in ratios since the pandemic,” - Vedanta Goenka

“The adjustments that state and local governments have made to their pension systems in response to pension system concerns, such as adjusting benefits, supplemental funding, and ensuring contributions are meeting their requirements, has demonstrated a commitment to take actions to ensure the sustainability of pension systems,” - Merl Hackbart

"So, you might have neighboring towns that have very similar pension profiles — one is carrying a high amount of debt, one is carrying a little amount of debt — I would say the one with a little amount of debt is in much better shape. So it calls for granular analysis [if] we're going to answer the question if pensions are still in crisis.” - Les Richmond

“In a lot of places, [pensions are] still very much an issue, but in terms of the national conversation, pensions have definitely kind of taken a step back.” - Liz Farmer

Be sure to subscribe to Special Briefing to stay up to date on the world of public finance.

Learn more about the Volcker Alliance at: volckeralliance.org

Learn more about Penn IUR at: penniur.upenn.edu

Connect with us @VolckerAlliance and @PennIUR on Twitter, Facebook and LinkedIn

Special Briefing is published by the Volcker Alliance, as part of its Public Finance initiatives, and Penn IUR. The views expressed on this podcast are those of the panelists and do not necessarily reflect the position of the Volcker Alliance or Penn IUR.

The Volcker Alliance and Penn Institute for Urban Research invite you to join an online Special Briefing on how the rollout of the $1.2 trillion Infrastructure Investment and Jobs Act (IIJA) is proceeding. A critical part of legislation passed by Congress to combat the economic impact of the COVID-19 pandemic and enhance the durability and sustainability of the nation’s infrastructure, the bipartisan deal promises thousands of new jobs and billions of dollars for roads, bridges, public transportation, water systems, and broadband access. Through July, the value of highway and bridge construction work was running 24 percent ahead of the 2020-21 pace, American Road & Transportation Builders data show. But there are bottlenecks as well, and the process of applying for federal grants is confusing, especially for smaller governments. Our panel of experts will sort this out and explain where infrastructure construction is headed.

Our panel of experts will include Representative Earl Blumenauer (D-OR); Samantha Silverberg, deputy infrastructure implementation coordinator at The White House; Alison Premo Black, senior vice president and chief economist, American Road & Transportation Builders Association; and Leah Brooks, professor, Trachtenberg School of Public Policy and Public Administration, George Washington University; Jessica Jennings, legislative director for transportation and infrastructure, National Association of Counties; and Vikram Rai, lead strategist, Wells Fargo municipal division.

Notable Quotes:

“This is the first time we have a commitment unequivocally to be able to rebuild and renew America. It's a refreshing change and an opportunity for us,” Representative Earl Blumenauer.

“The IIJA, or the bipartisan infrastructure law as we call it, is a once-in-a-generation investment in our nation's infrastructure,” Samantha Silverberg.

“I can tell you from a market standpoint, for the transportation sector, we're absolutely seeing that program have a very big market impact,” Alison Premo Black.

“Most of America's roads are in rural areas, and 70% of counties are rural. We experienced all kinds of challenges when it comes to our small counties. And the biggest one really is our capacity,” Jessica Jennings.

“Infrastructure costs more in the U.S. than it does in almost any other country in the world. And you might not be surprised that it costs more in the U.S. than it does in developing countries like China. But you might be surprised to hear that it costs the U.S. substantially more than other countries like Germany or Australia, countries that we think actually have a full suite of environmental protections in the same way that we would like to,” Leah Brooks.

“The IIJA aims to put more transportation infrastructure by public-private partnerships. It does so by doubling the amount of availability with the objective to increase P3 (public-private partnerships) funding,” Vikram Rai.

Be sure to subscribe to Special Briefing to stay up to date on the world of public finance.

Learn more about the Volcker Alliance at: volckeralliance.org

Learn more about Penn IUR at: penniur.upenn.edu

Connect with us @VolckerAlliance and @PennIUR on Twitter, Facebook and LinkedIn

Special Briefing is published by the Volcker Alliance, as part of its Public Finance initiatives, and Penn IUR. The views expressed on this podcast are those of the panelists and do not necessarily reflect the position of the Volcker Alliance or Penn IUR.