The Biggest Issues to Watch in 2021

• Feb 02, 2021

State lawmakers face a terrible hangover of problems from 2020. First and foremost is the pandemic, which is at its worst even as vaccinations are rolled out across the country. Caseloads and death tolls are adding uncertainty to the economy, which in turn is hampering state budgets.

As legislatures began to meet this month, some convened virtually due to concerns about COVID-19, while capitols were boarded up or surrounded by perimeter fences and SWAT teams because of the ongoing threat of political violence.

Anger about the election and its bloody aftermath is leading to partisan divisions about how to handle voting. Democrats would like to see more mail voting and other expansive measures, while Republicans argue that even the suspicion of widespread voter fraud — while shot down repeatedly in dozens of court cases in recent weeks — is reason enough to push for a more secure system. “There’s a sincere need for us to look at voting,” says Robin Vos, the Republican speaker of the Wisconsin Assembly. “We need to do a better job so that either side that is not successful feels that the result was legal and secure.”

Changes to election law will not be the only overtly political question facing legislators. This is a redistricting year. Republicans have held onto their advantage in terms of overall legislative control, but several states will see district lines drawn by independent commissions for the first time, thanks to recent ballot initiatives.

In many states, 2021 also offers the first chance for legislatures to weigh in on policing measures, following the death of George Floyd and the mass protest movement against police brutality and racism. “The events of this past summer captured the nation’s attention and the attention of policymakers and power holders at many levels,” says Massachusetts state Sen. Sonia Chang-Díaz, a Democrat and sponsor of a policing regulatory bill signed into law at the very end of 2020.

Measures addressing other areas of criminal justice, from sentencing law to drug decriminalization, will also be on the agenda. So will abortion, with red and blue states continuing to move in opposite directions as they wait to see what approach an increasingly conservative U.S. Supreme Court will take on the issue.

States are also waiting on a ruling from the Supreme Court in the latest case challenging the constitutionality of the Affordable Care Act. It appears likely that the law, so often challenged in the decade since its passing, will survive yet again. Certainly a Biden administration will work to expand it, following the Trump administration’s efforts to weaken or repeal it.

The ACA aside, states will have to come up with ways of financing Medicaid, unemployment and other programs that are in greater demand due to the economic downturn. An estimated 5 million individuals lost coverage last year due to job losses stemming from the pandemic. Housing will also remain a top-of-mind concern. Evictions have increased but millions more could be at risk as various federal, state and local moratoria expire.

On top of the COVID-related issues, there are many perennial topics that lawmakers will want to address. Many sessions were cut short last year, meaning there’s pent-up demand to address ongoing challenges in areas such as pension costs, infrastructure and climate change. “Just in my committee, as chair of the Energy and Telecommunications Committee, we have everything from carbon pricing to expanding access to broadband across the state, particularly for kids now being forced to learn remotely,” says New York Democratic Sen. Kevin Parker.

How much bandwidth will remain for all that remains an open question. No one predicted at this point last year that the coronavirus would shut down much of the nation for weeks and months on end. Assuming the nation gets through 2021 without facing any further challenges that are now unknowable, coping with the ones already at hand will be difficult enough. “It’s going to be triaging COVID and economic recovery and setting our state budget,” says Republican Kurt Daudt, the minority leader in the Minnesota House. “We’re still operating remotely. Beyond those issues, it’s going to be difficult to get much more done than those three things.”

Even where there’s will and desire to address policy concerns, there’s also the question of how much money will be available to fund new initiatives. State and local governments eliminated 1.4 million jobs between February and November of last year, nearly double the total number of layoffs at the low point of the Great Recession. Although revenues generally aren’t as dire as predicted last spring, there are still shortfalls in the billions. Some states, though not all, are in a serious hole. All states face increased spending pressures due to the pandemic, from social services and vaccine distribution to retrofitting schools due to health concerns.

The pandemic may well be over or at least under control as the year progresses, but it remains the dominant challenge for states. When sessions began, one front-of-mind concern for legislators was limiting the emergency powers of governors and other executive branch officials. Much of this is playing out on a partisan basis, but there’s been a fair amount of frustration among legislators on both sides of the aisle who feel they’ve been sidelined. At the same time, Republican lawmakers are interested in providing private companies with protection against COVID litigation. “Fifty to 60 percent of everything we talk about is going to be COVID-related,” says Republican Caleb Rowden, majority leader of the Missouri Senate. “Our response to it, how to handle money from the feds and liability protection.”

In short, lawmakers face a challenging year and difficult circumstances in which to do their work. — Alan Greenblatt


It has been nearly 50 years since the U.S. Supreme Court, in Roe v. Wade, struck down a Texas statute banning abortion, effectively legalizing the procedure across the nation. Ever since, that decision has acted as a lightning rod galvanizing those for and against a woman’s right to choose an abortion. Especially in the last decade, conservative states have sought to impose ever-greater abortion restrictions. Between January 2011 and July 2019, nearly 500 new state abortion restrictions were enacted, mostly in the South and Midwest. Many of these involved parental notification for minors, counseling mandates, limits on public funding and strict regulation of clinics.

Polls show that nationally, a majority of adults think abortion should remain legal, at least to some degree, and that Roe v. Wade should not be overturned. Last summer, Chief Justice John Roberts joined four liberal colleagues as the Supreme Court struck down a Louisiana law designed to restrict access to abortion, potentially shutting down all but one clinic in the state. Now that there is a six-to-three conservative majority on the high court, states will likely continue to enact restrictive abortion laws, attempting to force the court to revisit Roe v. Wade. If Roe is reversed, abortion would be immediately illegal in the ten states that have passed “trigger laws,” enacted to ban abortion automatically whenever Roe is overturned. The Center for Reproductive Rights says that if Roe v. Wade were weakened or overturned, abortion rights would be protected in less than half of the U.S. states.

While some states are working to restrict access to abortion, others are going in the opposite direction, passing laws to protect abortion rights. New York, Vermont, Connecticut, California, Oregon, Washington, Hawaii and Virginia have all expanded access to abortion in recent years. Voters in Colorado — one of seven states without a cut-off date for abortion — rejected a proposal in November that would have limited abortion to the first 22 weeks of a pregnancy. More than a tenth of Colorado’s abortions are performed on out-of-state patients. In the waning days of 2020, the Massachusetts Legislature overrode Gov. Charlie Baker’s veto of legislation that increases the number of weeks during which abortion is available and lowers the age of consent. It was the consent provision that the governor objected to.

Abortion law will be debated in several state legislatures in 2021. Prior to the new year and the 2021 legislative session, the Arkansas Unborn Child Protection Act was pre-filed in November. The bill would ban abortion outright, except to save the mother’s life. As of January, pregnant women in Indiana will be required to undergo an ultrasound procedure at least 18 hours before getting an abortion. Abortion access is also expected to come up in the 2021 Arizona, Montana and Texas legislative sessions. Several other states are waiting to see what happens to legislation that has been blocked in federal court. — David Kidd

ACA/Health Care

Nearly 2.3 million Americans lost health insurance during the first three years of the Trump administration, including 1.6 million living in “swing states.” It’s been estimated that job losses contributed to more than 5 million Americans losing their insurance between February and May 2020, making single-year coverage losses the greatest in American history.

With the pandemic overwhelming families, communities and the health-care system, it could have been worse. Republicans have worked to overturn the Affordable Care Act (ACA), and up until the Supreme Court heard oral arguments in Texas v. California, it seemed possible it might succeed.

The suit, brought by 20 states and two individuals, seeks to negate the entire ACA on the basis that its individual mandate for coverage, accompanied by a financial penalty, is unconstitutional. (In 2017, Congress reduced this “penalty” to zero.) The plaintiffs argue that the mandate is not severable from the law, and thus, ACA is not enforceable.

Oral arguments left observers with the impression that even if the court rules that the mandate is unconstitutional, the remainder of the ACA will stand. “I think it’s hard for you to argue that Congress intended the entire act to fall … when the same Congress that lowered the penalty to zero did not even try to repeal the rest of the act,” Supreme Court Chief Justice Roberts said to the Texas solicitor general leading the case.

A final ruling is not expected until the spring. Even though the danger may be past, it’s important to consider what’s at stake. An Urban Institute analysis outlines the consequences that overturning ACA would have by 2022, including a 69 percent increase in the number of uninsured Americans, a decrease of more than $150 billion in federal spending on health care and a $135 billion decrease in spending by and for the nonelderly. States, local health-care networks, providers and citizens would suffer greatly.

“It's almost impossible to imagine overturning the Affordable Care Act at this point because the pieces are inextricably intertwined with how the public and private health insurance systems operate,” says health economist Linda Blumberg, PhD, a fellow at the Urban Institute’s Health Policy Center and a coauthor of the report.

Thirty-eight states have expanded Medicaid under the ACA, and even though the federal government pays only 90 percent, states save. “Medicaid expansion is a financial winner for the States,” says Blumberg. “It has been demonstrated to reduce their other spending on health care significantly enough that they come out financially ahead – the providers want it and the low-income population needs it.”

There are other benefits. A report from the Square One Project highlights the advantages of investing Medicaid expansion funds in a coordinated continuum of care that includes case management and services that address the full range of determinants of health, with effects as far-reaching as reducing mass incarceration and recidivism.

“Medicaid is underused -- it can be a health reform, housing reform and justice reform tool,” says report author Lynda Zeller, a senior fellow at the Michigan Health Endowment who has decades of experience as a state health official. “Every Medicaid program has a state plan, and each state, red or blue, can build a plan that adds more tools and serves more people.”

If challenges to the ACA have subsided, what will the coming year bring? President-elect Biden has expressed opposition to the single-payer systems proposed by others in his party. At the state level, cost transparency and containment will be priorities as citizen need for care is increasing and their ability to pay declining. — Carl Smith


Heading into 2020, just about every state was anticipating revenue growth. In 2021, very few states are in that situation.

The economic fallout of the virus-driven recession has hit states hard – although not as hard as initially expected. States were highly conservative with their own forecasts as the pandemic struck last spring, meaning the picture looks rosier than it did back in the spring, but still not great. The Brookings Institution estimated in December that state shortfalls would total $350 billion from fiscal 2020 through 2022. That’s well below Brookings’ own estimate just three months earlier.

“States were very cautious with this situation,” says Dan White, director of government consulting at Moody’s Analytics, a financial research firm. “We’re seeing a number of states seeing revenues higher than they thought they were going to be. That doesn’t mean they’re up or they’re doing well.”

Heavy stimulus spending from the federal government has helped prop up economic activity, and with it state budgets. The other surprising factor is the unusual nature of this downturn. The stock market is reaching new records, while corporate profits are high even as Main Street businesses struggle. Similarly, more affluent professionals able to work remotely have fared better than lower-income service workers.

In California, what was projected to be a $54 billion shortfall last spring has morphed into a $15 billion surplus. “We’re in this very odd situation because of the intense dichotomy that the pandemic has brought in terms of economic effects,” says Chris Hoene, executive director of the California Budget and Policy Center, a watchdog group. “Our progressive tax system is yielding unexpectedly strong revenues because people at the very top of the income spectrum and corporations are thriving and, if anything, doing better than they were before.”

Thanks to changes in law, states in general have captured more revenue from online sales than would have been the case just a few years ago. Those that tax groceries are also faring pretty well. But many states dependent on sales taxes are struggling, along with those reliant on oil production. White predicts states in general could still be in for a rude awakening when personal income tax returns are filed in April, with tourism-dependent states hurting worst of all. “The governor’s initial budget that was just recently presented to the Legislature contemplates four years of furloughs and program cuts,” says Della Au Belatti, majority leader of the Hawaii House. “That’s the depth of our budget crisis.”

Every unhappy state is unhappy in its own way. Even in California, where revenues have improved, things are just climbing back to where they would have been had the pandemic never happened. Meanwhile, that state and all the others face unanticipated spending costs in areas such as unemployment benefits, health care, school safety and vaccine distribution.

States face an additional problem. They may have entered 2020 with record reserves, but those have been in many cases depleted, although not entirely drained. “If you look at budget actions taken to close out 2020 budgets, a lot of them were one-time solutions, delaying the reckoning,” says Tracy Gordon, a senior fellow at the Urban-Brookings Joint Tax Policy Center. “That’s the logic of recessions. You do the easy things first with one-time solutions, then have to get down to business in the next year of the crisis.” — Alan Greenblatt

Climate Change

While everyone’s attention was understandably focused on COVID last year, the impact of climate change continues to be felt across the country and around the world. Exacerbated by exceptionally hot, dry weather, some 10 million acres were lost to wildfires in the West, displacing thousands and creating a toxic cloud that hung over several states for weeks. A record-breaking number of named hurricanes and storms battered the East and Gulf coasts, including Laura, which killed dozens and caused billions of dollars-worth of damage to Louisiana, including $1.6 billion in losses to the state’s agriculture sector.

Extreme weather events from 2017 through 2019 cost the country over $460 billion in damages. Storms are expected to increase in frequency and intensity, as temperatures continue to rise. Rising sea levels are already encroaching on a number of Atlantic and Gulf Coast cities.

The federal government’s diminished response to climate change over the last four years has left a leadership void that a number of cities and states have attempted to fill. After President Trump pulled the U.S. out of the Paris Agreement in 2017, a coalition of 25 governors — mostly Democrats — formed the U.S. Climate Alliance, committed to reducing greenhouse gas emissions consistent with the Paris goals. At the local level, 470 “U.S. Climate Mayors” have banded together with the same intention.

It is difficult, though, for local jurisdictions to be as effective as efforts taken at the federal level. A recent report by the Brookings Institution determined that less than half of the country’s 100 largest cities are currently addressing emissions reductions. In total, their cutback targets equal only about seven percent of U.S. goals set forth in the original Paris Agreement. Another 22 large cities have committed to reducing emissions but have yet to set targets. Los Angeles has seen the greatest decrease in emissions, followed by San Francisco. Tucson experienced the largest increase in emissions, mostly due to that city’s rapid growth. But there is only so much that cities can do since they have little control over many of the factors that contribute to the problem, transportation being one example.

Last April, Virginia joined nearly a dozen other states with a legislative commitment to a 100 percent clean energy future. But just like cities, there are limits to what states can do. Budgets must be balanced at a time when cash-strapped states will be looking for ways to cut spending, thanks to the economic crisis brought on by the pandemic.

Help may come at the federal level. The most significant climate change legislation in a decade arrived as part of the COVID-19 relief bill passed by Congress in December. The bill includes billions for research and development of clean, renewable energy plus continued tax credits for existing technologies, a key component of Joe Biden’s $2 trillion plan to achieve 100 percent clean energy by 2035.

The new president’s intention to update the country’s energy infrastructure is a key component of his plan to revive the economy after COVID. Change can’t come soon enough for fans of Winter Fest in Caro, Mich. Scheduled for February, the annual outdoor event was canceled the past two years due to a lack of ice and snow. This year organizers aren’t waiting on the weather to decide if it will happen. The 2021 event was recently canceled, this time because of the coronavirus. — David Kidd

COVID Shields

Could businesses and health-care providers, already overwhelmed financially and operationally, be crippled by lawsuits blaming them for COVID injuries? The concerns and exposure of these stakeholders has taken on a new urgency with the ongoing surge in cases and related deaths from the pandemic.

In September, an insurance risk evaluator estimated that claims regarding the spread of workplace contagion to family members could cost businesses as much as $21 billion if the COVID death toll reached 300,000. The COVID-19 death count is now approaching 400,000, but a crushing wave of lawsuits has not materialized.

More than 7,000 cases are listed in a COVID-19 Complaint Tracker from the law firm Hunton Andrews Kurth. Less than 200 lawsuits relate to malpractice, wrongful death and workplace exposure. However, more than 700 complaints focus on business closures, stay-at-home orders, public gathering bans and efforts by private parties to enforce government orders.

A Ballotopedia database, devoted entirely to cases protesting state actions and policies, reflects the fallout from federal messaging that has undermined scientific bodies, experts and advisors, while politicizing public health best practices such as mask wearing and social distancing.

Republicans hoped to include a liability shield in the recent $900 billion stimulus bill, but the provision was cut. NCSL’s COVID State Legislation Database includes more than 120 bills from 20 states that attempt to limit the liability of businesses, health-care providers and schools, including manufacturers and distributors of PPE.

Gross negligence or reckless misconduct void these shields. Massachusetts also excludes conduct with an intent “to discriminate based on race, ethnicity, national origin, religion, disability, sexual orientation or gender identity” from protection.

The declaration of a national public health emergency meant that, under the Public Readiness and Emergency Preparedness Act (PREP), health-care professionals are shielded under both state and federal law in regard to the administration of “covered countermeasures” against COVID-19. These can include vaccinations, diagnostic tests and respiratory devices.

Worker advocates worry that liability shields could cause employers to be less vigilant, placing workers and customers at risk even if the actions of employers don’t meet the “gross negligence” standard. They object to any laws that might interfere with the ability of OSHA or similar state entities to establish safety protocols and enforce them.

Schools pose a particular challenge relating to liability. They operate in a complicated landscape, pushed in every direction by government officials, parents and teachers. Even though public schools may be protected if they are following public health guidance, many districts are purchasing additional liability insurance, says Patrick Lyons, a policy specialist at the National Conference of State Legislators.

“Districts are asking, ‘Even if we follow the best guidance now, what if it turns out to not be right and we have a bunch of spread. Can we be held liable for standards that weren't yet developed?’” he says.

It’s not that schools expect to lose COVID suits, but that the legal fees alone could inflict serious damage. Louisiana and Tennessee have enacted bills specifically to protect schools, but there hasn’t been a big push for more legislation aimed at protecting this sector.

“We're not really sure until someone challenges this in court,” says Lyons. “But most people don’t think it would be easy to prove whether COVID-19 transmission happened in the school or outside of the school.”

Understanding the coronavirus, its long-term effects, and best practices for treatment and prevention is still evolving. So far, there are more lawsuits against government efforts to protect public health than claims of injury. Over the coming year, it may become more obvious who needs to be protected. — Carl Smith

Criminal Justice

There are over 2 million people behind bars in the United States, representing a quarter of the world’s prison population. The vast majority of these are confined within state prisons, putting a major strain on budgets. The cost of food, security, health care and infrastructure can amount to as much as $70,000 a year, per inmate. After decades of spending increases and tough-on-crime policies, prison populations have continued to grow, and recidivism rates have remained high, further straining state budgets. In the last 20 years, public officials and policymakers have been looking for ways to reduce the number of prisoners, keep communities safe and lower associated costs.

Last year saw a significant reduction in incarceration, due more to COVID than prison reforms. The country’s prison population has been hit hard by the pandemic, at times dealing with a rate of death three times higher than the general population. Last spring, over 100,000 inmates were released from state and federal prisons directly and indirectly because of the virus. Rhode Island reduced its prison population by nearly a third. Connecticut, North Dakota, West Virginia and Vermont populations are down by 15 percent. Court closures, parole leniency and a halt to accepting new prisoners from county jails contributed to the declines. The numbers are expected to rise again once the pandemic has been addressed.

Several states last year enacted changes intended to keep people from entering the criminal justice system in the first place. Many ended the suspension of driver’s licenses for failure to appear in court or for violations not related to unsafe driving, a practice that can trap people in a cycle of jail time and mounting fines and fees. Driving without a license is the third most common reason for going to jail in Michigan, according to a task force convened by Gov. Gretchen Whitmer in 2019, a year when 365,965 Michigan drivers had their license suspended. At least ten states now have laws ending license suspension for unpaid fines and fees, including Virginia which had suspended nearly a million licenses before ending the practice in 2020.

Referendums on marijuana legalization and decriminalization passed in four states last year. Voters in Arizona, Montana and New Jersey approved recreational use, as they did in South Dakota where the governor is backing a legal challenge. Voters in Oregon made that state the first to decriminalize possession of small amounts of cocaine, heroin and methamphetamine. Locally, voters also approved initiatives in San Jose, Seattle, Pittsburgh, Philadelphia and Portland, Ore., designed to strengthen civilian oversight of police departments. Many proposals had been in the works for years but recently gained traction after a spring and summer of social unrest. Voters in Columbus, Ohio, approved a new police review board, the first for that city.

Regretting his past support for a 1994 crime bill that is widely seen as contributing to mass incarceration, President-elect Joe Biden now endorses an end to mandatory-minimum prison sentences. He has proposed a $20 billion grant program to fund state mental health and substance abuse programs in an effort to reduce prison populations. — David Kidd

Election Reform

Already on alert to prevent a repeat of Russia’s interference in the 2016 presidential voting, election officials in 2020 also faced the challenge of protecting voters during the biggest public health emergency in a century. Learning from missteps in primary elections, they succeeded, safely delivering an election with record turnout that intelligence officials proclaimed to be the most secure in American history.

There were scant moments of glory for them, however, amid attacks from the president, conspiracy theorists, extremist news outlets and foreign actors on the changes implemented to make voting safe and to ensure that citizens would not be disenfranchised. Rather than being praised, many election officials received hate mail and even death threats.

A November Politico poll following the announcement of Joe Biden’s victory found that 70 percent of Republicans did not believe the election was free and fair, making accusations against mail-in voting and ballot tampering. A Quinnipiac poll in December found that 77 percent of Republicans believed there was widespread election fraud, though 60 percent of all registered voters accept that Biden’s victory is legitimate.

Despite the failure, and outright dismissal, of dozens of court cases purported to prove the election had been stolen, this false narrative gained enough traction to inspire thousands of the president’s supporters to storm the Capitol on Jan. 6 with the hope of preventing the certification of electoral votes.

The president’s role in fomenting this lawlessness at rallies, via Twitter from the White House and in person on the morning of the attacks has cost him the support of prominent Republican allies, as well as members of his Cabinet. But some party leaders at federal and state levels remain concerned that practices implemented in 2020, including no-excuse and universal vote-by-mail and drop boxes, are not in their best interests.

Democratic victories in the Senate runoff elections in Georgia in January added to the dispute. Republicans there blame liberalized access to voting for these losses, and plan to introduce legislation to eliminate no-excuse absentee voting, drop boxes and mailings of ballot applications.

“The rhetoric that we've seen in the wake of the election is going to add fuel to calls to limit the franchise in ways that are not necessary to actually make elections more secure — things like limiting curbside voting, limiting the use of drop boxes for absentee ballots or narrowing early voting periods,” says Daniel I. Weiner of the Brennan Center’s Election Reform Program.

Hundreds of bills relating to elections have been introduced in state legislatures since November, including bills intended to use the lessons learned in 2020 to increase voter participation. U.S. House Speaker Nancy Pelosi has announced that Democrats will lead their 2021 agenda with HR1, the For the People Act, which would establish uniform national standards for voter registration, voting by mail, early voting and election security.

“HR1 would be transformative,” says Weiner. “It’s not going to codify all of the changes made to account for the pandemic, but the changes it would make are tried and tested ways of making voting more accessible that are popular with both Democrats and Republicans.” — Carl Smith


The maxim “housing is health care,” coined in the early years of the AIDS epidemic, has never had more significance. Sheltering in place requires a place to shelter, and homelessness was already on the increase before the economic shocks of the pandemic.

The daunting challenges of dealing with the health problems of more than 500,000 homeless Americans have been compounded by the potential for tens of millions of evictions to swell their ranks.

In 2020, state legislators made efforts to stem an eviction crisis through dozens of bills suspending evictions and foreclosures. Funding for rental assistance was included in the CARES Act last spring. Researchers from UCLA and Johns Hopkins who studied the impact of eviction moratoriums on death rates confirmed that such policies save lives. Mortality rates in 27 states that kept moratoriums in place were compared to those in 17 that lifted them. After sixteen weeks, death rates were more than five times greater in states that had ended renter protections.

The crisis is far from over. A December 2020 survey by the Census Bureau found that 14 million adults, 20 percent of renters and 25 percent of households with children are not caught up on their rent payments. The share of Black and multiracial households in this destabilizing situation approaches 30 percent.

The $900 billion COVID-19 Economic Relief Bill signed into law in December includes $25 billion in emergency rental assistance to be distributed to states and extends the CDC eviction moratorium through the end of January. However, a recent Urban Institute analysis points out that accumulated back rent alone, which must be paid when moratoriums end, may be as much as $34 billion.

It’s time for policymakers to adopt the viewpoint that housing is a basic human need, says Steve Berg of the National Alliance to End Homelessness. “There’s no waiting list for the Supplemental Nutritional Assistance Program,” he says. “We don’t set up schools for half the people and put everyone else on a waiting list; everyone who is eligible gets Medicaid.”

During his campaign, Biden signaled an intention to invest $640 billion in housing, providing support for renters and homeowners, and addressing the inadequate supply of affordable housing. The big question will be whether it’s possible to get Republicans on board with the idea that government has an obligation to help.

In addition to cementing the connection between housing and public health, pandemic stresses have created opportunities. A softening in the rental market means that government funds might stretch further and house more homeless. Vacated urban buildings could be reconfigured as affordable housing units, making it possible for tenants to have easier access to jobs and services. — Carl Smith


Ever since the Supreme Court made Medicaid expansion voluntary for states under the Affordable Care Act, there has been ongoing debate about whether or not to participate. In 2014 when the law took effect, 23 states immediately expanded Medicaid eligibility. Over the years, other states said yes to expansion after overcoming initial reluctance. Today there are still a dozen states that have neither adopted nor implemented Medicaid expansion. With the country in the midst of a massive public health emergency and economic crisis, arguments for and against expansion are now set against a very different backdrop.

Since the pandemic started, millions of Americans have lost their livelihoods and with that their health insurance, putting strains on a health-care system already stretched thin. A recent study by the Urban Institute found states that expanded Medicaid are able to cover 35.8 percent of unemployed adults. In the states that chose not to expand, only 16.4 percent of unemployed adults are eligible, resulting in an uninsured rate of 42.5 percent, double the rate in expansion states.

Efforts to enlarge Medicaid have been made in each of the holdout states, but it seems unlikely any will approve expansion in the immediate future. Legislators in Wyoming voted in support of a Medicaid bill in committee over a year ago, but it died on the first day of the 2020 legislative session. The bill will be considered again when legislators meet this year. In the meantime, COVID and a shrinking coal market are taking a toll on the state’s economy, causing an increase in unemployment claims. The Wyoming Department of Health estimates expansion would cost $154 million to cover 19,000 Wyomingites in the first two years. The state’s share would be $18 million. Never enthusiastic about expansion, Gov. Mark Gordon nevertheless told the Casper Star-Tribune that if the Legislature passes a bill, he will give it a “fair hearing.”

Like their counterparts in Wyoming, the Florida Legislature has so far shown little interest in expanding Medicaid, with attempts by Democrats having been consistently blocked by their Republican colleagues. The pandemic has spurred renewed efforts by health officials to reconsider, but so far without success. By not expanding, Florida is projected to forfeit $66 billion in Medicaid funding from the feds, according to a study by the Robert Wood Johnson Foundation and the Urban Institute, more than any other state.

Recalcitrant legislators and governors are not always able to thwart attempts to bolster Medicaid. Maine, Utah, Nebraska, Idaho, Oklahoma and Missouri have approved expansion through ballot initiatives. Florida, on the other hand, just passed a law intended to limit ballot initiatives, spurred in part by the Legislature’s desire to thwart expansion.

The effects of the pandemic will be many and long lasting, not the least of which is how we fund health care. Joe Biden campaigned on improving the Affordable Care Act, reversing the previous administration’s attempts to chip away at the program, having failed to stop it altogether. Expansion dissenters in the dozen holdout states say they can’t afford it. Proponents think they can’t afford not to expand. — David Kidd


New Jersey has long had one of the worst-funded pension systems in the country. Last year, the state made a record $4.7 billion pension payment. That sounds pretty good, until you realize that New Jersey borrowed $4.5 billion from the feds. The loan didn’t go directly to pensions, but money is fungible, and clearly, state lawmakers didn’t come up with any new funds to cover pension obligations.

Funding for state and local government pension plans is a perennial problem that hasn't gotten any better. The performance of the stock market in recent months, after its precipitous fall last February and March, has helped ameliorate things a great deal. What could have been a terrible year for pensions was a middling one instead. Still, pension systems fell short of their growth targets. Altogether, state and local pension funds are underfunded by more than $1 trillion. “After a decade-long bull run in the market, their solvency hasn’t changed much,” says Leonard Gilroy, senior managing director of the libertarian Reason Foundation’s pension integrity project. “There’s been a lost decade in pensions.”

Low interest rates have sent pension managers hunting for more lucrative – and thus more volatile – investments. Some states and a number of local entities (not just cities but nursing home districts and the like) have been exploring pension obligation bonds. These allow states or localities to borrow large sums of money, which can fill immediate funding holes. Issuers can come out ahead in the long run if they achieve market returns that are larger than the rate they’re paying bondholders, but POBs are risky. They contributed to the insolvency of Puerto Rico’s public employee pension system and the bankruptcies of Detroit and Stockton, Calif.

This is a tough year for dealing with pension finance. Budget pressures led state and local governments to shed 1.4 million jobs between February and November. That has resulted in savings, but also presents a problem to pension systems. Generally, it’s younger workers who are let go, meaning there will be fewer people working and making payments to support those who are retiring. “After the last recession, it took almost 10 years to regain all the jobs that were lost,” says Dan White, director of fiscal policy research with Moody’s Analytics, a financial research firm. “If it takes as long this time, that sets you back almost a generation to get a new wave of workers paying into those systems. There’ll be even more mismatch between older employees taking out of the system and fewer younger paying in.”

With states still navigating difficult fiscal straits, it will be tempting for some to forego or reduce contributions to the pension system. There’s been less talk along those lines than some analysts feared, with legislators having learned a hard lesson about skipping payments during the Great Recession. That doesn’t mean it hasn’t happened. In its budget passed last year, for example, Colorado withheld a $225 million payment called for by a sweeping pension overhaul law enacted just two years earlier. “A one-year suspension can be a blip, two becomes an issue and three becomes a problem,” Gilroy says.

Given all the other demands that the pandemic and an uneven economy present, the temptation to underfund pensions will remain a factor this year. “This is a huge long-term problem,” says Timothy Little, an analyst with S&P Global Ratings, “that short-term political problems are not going to allow addressing.” — Alan Greenblatt


George Floyd died on May 25, 2020. His death, along with other officer-involved killings, sparked a massive nationwide protest movement. Most legislatures have barely met since that time, however. “The 2021 legislative sessions will be the first chance for many states to weigh in,” says Adam Gelb, president of the Council on Criminal Justice. “We expect that they will, in a big way.”

Legislators are considering a wide range of approaches to address policing and complaints about brutality, including bans or limits on chokeholds and no-knock warrants. Many are thinking about limiting or ending qualified immunity, a legal doctrine that generally shields law enforcement officers from civil liability for their actions. It’s possible that state attorneys general will either be allowed or mandated to investigate officer-involved killings, while the idea of giving civilians a greater say in terms of oversight and training standards is also on the table.

“Cities and states across the country have restricted the ability of police to use force in a way that’s truly remarkable,” says DeRay Mckesson, co-founder of Campaign Zero, an umbrella group that advocates for policies to eliminate police violence. But, he adds, “It’s a ceiling, not a floor.”

On New Year’s Eve, Massachusetts Gov. Charlie Baker signed a sweeping bill that will, among other things, ban chokeholds, racial profiling, the use of tear gas during large demonstrations and no-knock warrants when children or seniors are home. It also creates a civilian-led commission in charge of police officer standards and training, as well as imposing other limits on use of force. Sponsors of the bill had to compromise to win Baker’s signature and intend this year to address qualified immunity and police use of military-grade equipment, while increasing availability of social service responses.

Addressing these issues while race and policing are front-burner issues is paramount, says Massachusetts Sen. Sonia Chang-Díaz. George Floyd’s death and other cases helped create “a tragic window of opportunity. There’s just a mountain of injustice out there that has been accumulating for 400 years,” she says. “We should have a sense of urgency at taking as big a bite out of that mountain as we can.”

The protests of last summer, however, have largely faded away. Policing as an issue has been shunted from atop the national agenda by the election and its aftermath, along with the ongoing challenges posed by the pandemic. Also, it’s not as if support for changing the rules regarding the police has universal acceptance. “Defund the police” is a slogan that Democrats from Joe Biden and Barack Obama on down believe hurt the party’s chances in November.

Law enforcement agencies and police unions are pushing back hard against attempts to regulate policing. They’re arguing that a bill just passed in Illinois, which would limit qualified immunity and cash bail and strip away collective bargaining rights, could lead to mass retirements and the “death of policing.” “They are basically going to war with the police unions in Illinois,” says retired police Sgt. Betsy Brantner Smith, spokesperson for the National Police Association, a nonprofit that works to educate the public about policing.

Legislators in some states will shy away from such confrontations, Mckesson predicts, looking to chiefs and sheriffs to clean up their own acts rather than taking on major fights at the capitol. Other states will push for new policies on a piecemeal basis, while some lawmakers believe that omnibus bills have the best chance of being signed into law. “No one strategy will get us there,” Mckesson says.

He argues that state action is necessary because the number of police killings is rising fastest in suburban and rural areas, rather than the major cities that typically draw media and policy attention. There are 18,000 police departments across the country, which have long had a fierce independent streak. With not only state but federal lawmakers looking to change the ground rules for how they operate, however, law enforcement knows it faces greater political challenges this year than any in recent memory. “There is such significant pressure to act,” Gelb says, “that state and federal governments are going to be wading into waters that have previously been reserved for local jurisdictions.” — Alan Greenblatt

Race and Racism

In 2020, waves of protests created global support for Black Lives Matter, which has been building since 2013. Citizens called for police reform, including an expanded look at how public funds could be used to create safe communities.

The COVID-19 pandemic may have done even more to expose the impact of institutional and structural racism. Black and Hispanic citizens who contract COVID are being hospitalized about four times as often as white Americans and are three times more likely to die. Even if they manage to avoid serious illness, they face other life-changing risks.

Disparities in economic opportunity, food security, housing, health-care access and other social determinants of health are behind these outcomes. Recent research suggests that the stress of racism itself is shortening Black lives. The Ferguson Commission, formed after the 2014 shooting of Michael Brown, found that life expectancy in the St. Louis area varied as much as 40 years between suburban and inner-city ZIP codes.

To date, more than 170 jurisdictions have made declarations that racism is a public health crisis, according to the American Public Health Association (APHA). This trend, which began several years ago and accelerated in 2020, is expected to continue in the coming year.

“Health is a shared value regardless of political leaning,” says Tia Taylor Williams, who leads APHA’s racial equity work as director of its Center for Public Health Policy and Center for School Health and Education.

“These declarations are public and historic acknowledgment that racism is a major driver of public health outcomes,” she says. “They create a window for applying a racial justice and racial equity lens to decision-making.”

While some states have made efforts to turn racial change into legislative action, local governments have taken the lead in addressing structural inequities that COVID has laid bare, says Gordon Goodwin, director of the Government Alliance on Race and Equity.

“They end up with the gnarliest problems, with the fewest resources, but they have to deal with them,” he says. “They can’t just turn their eyes away.”

Local governments have tools, such as GIS mapping, that can help pinpoint where risks to minority citizens are greatest and where programs and funding should be concentrated. A health and equity report from Louisville, Ky., includes maps showing county-by-county death rates, infant mortality, life expectancy and other indicators.

Jurisdictions are working to identify things that unintentionally contribute to racialized outcomes, says Goodwin. These include fees and fines that the poor can’t afford to pay. Even library fines, which don’t lead to more book returns, can cut access to books and library-based services such as blood testing for diabetes and afterschool programs.

Divisive racial messaging from Washington has played into the worst fears of citizens on the fringes, says Goodwin, adding to their distrust of government. It has also intensified the feelings of those who see social welfare programs as handouts.

Healing and unity are in the air as national themes for 2021. If this change in tone inspires focused, data-driven policies, progress toward equity may be possible. — Carl Smith


Possessing control of the legislature in at least 30 states, Republicans will dominate redistricting for the next decade. At the congressional level, they will be able to draw maps for 175 House seats — up from 98 following the 2010 census — while Democrats will draw just 47 seats, a slight decline from 51 seats back in 2011. Thanks to partisan gerrymanders, Republicans are in good shape to continue their dominance of several legislatures where GOP majorities have endured despite growing Democratic vote totals.

“The Republican Party will be able to secure a decade of power across the country,” Austin Chambers, then the head of the Republican State Leadership Committee, said following November’s elections, in which Democrats failed to flip a single chamber.

Republicans have a green light to press their advantages, as do Democrats, wherever they are in control. In 2019, the Supreme Court ruled that federal courts have no role to play in determining whether maps are so one-sidedly partisan as to be unconstitutional. “That does open the door for really blatant and outward partisan favoritism,” says Yurij Rudensky, redistricting counsel at the Brennan Center for Justice.

Partisan gerrymandering can still be stopped by state courts. In recent years, state courts have ordered new congressional maps in North Carolina and Pennsylvania, as well as new lines for the Virginia House and the Florida Senate. In all cases, that meant help for Democrats.

The prohibition against federal courts ruling on partisan gerrymandering has led to some fears that legislatures will engage in racial gerrymandering — which can still be challenged — while insisting they are acting out of permissible partisan self-interest. The Supreme Court made clear its continued opposition to racial gerrymandering over the past decade, in cases involving Alabama, North Carolina and Virginia maps. “We now have better guidance for avoiding racial gerrymandering,” says Jeff Wice, a Democratic redistricting attorney. “Legislatures have been put on notice not to pack more Black and Latino voters into districts than necessary.”

Although Republicans clearly have the upper hand nationwide, there are factors that complicate the picture in some states. Congressional and legislative maps in California will be drawn by a nominally independent commission, so it looks like Democrats will be able to dominate the process there. Conversely, while GOP legislators will run redistricting in Florida, state law mandates some measure of competitiveness.

Commissions and other new redistricting systems are in place thanks to ballot initiatives enacted over the past decade in Colorado, Michigan, New York, Virginia and Utah. In Ohio, voters passed a measure in 2018 that requires maps drawn by legislatures to receive a three-fifths vote, including majority support from the minority party.

Since 1980, Iowa has run a process widely considered a model, with districts drawn by nonpartisan staff barred from taking an incumbent’s residence into account. The Legislature has to accept or reject these maps on up-or-down votes, but can make changes if the first two versions are rejected. GOP legislative leaders have not ruled out making changes at the end of the process this time around. “No, I’m absolutely not going to make that commitment,” House Speaker Pat Grassley said on Jan. 7, saying it was “ludicrous” to expect approval before any maps or Census data are even available.

Census data is nominally due to states by April 1. There have already been delays in releasing data, as there have been throughout the Census process due to the coronavirus pandemic. That could create tight deadlines for New Jersey and Virginia, which hold legislative elections in 2021. Half the states face constitutional or statutory deadlines to complete redistricting this year.

The other major legal change during this cycle stems from the Supreme Court’s 2013 decision in Shelby County v. Holder, which gutted parts of the federal Voting Rights Act. The law had required seven Southern states, as well as jurisdictions in four others, to obtain preclearance from the federal Justice Department before making any changes in voting laws. Since the Shelby decision, the formerly monitored jurisdictions have imposed new voting and registration restrictions and closed hundreds of polling places.

This will be the first redistricting cycle where federal approval won’t be required in those places. “It covered things like school boards and city councils and county commissions,” Rudensky says. “The civil rights community just simply doesn’t have the resources to police what is happening at every level of government when it comes to redistricting.” — Alan Greenblatt

Transportation and Infrastructure
After nearly a year of lockdowns and stay-at-home orders, the country’s transportation system is slowly gearing up for a return to normal. It remains to be seen, however, what normal will look like in 2021. COVID has been especially harmful to mass transit, which saw national ridership in April of last year fall to less than a fifth of what it was in 2019. According to the American Public Transportation Association, ridership rebounded over the summer to almost 40 percent of the 2019 level until the coronavirus surged again in the fall.

The reduced number of passengers and the resulting loss in fare revenue will make it difficult to provide pre-pandemic levels of service anytime soon. Depending on the locality, fares can provide up to half of a system’s income. Adding further strain to budgets, lower sales and income taxes threaten operating subsidies provided by state and local governments that are grappling with budget shortfalls of their own. According to a recent Brookings Institution report, state and local government revenues will continue to fall, declining $167 billion in 2021 and $145 billion in 2022.

The New York City Transit Authority, the country’s largest, is facing a $6 billion deficit. The Bay Area Rapid Transit system in California reports a nearly 90 percent drop in riders since last summer, compared to pre-pandemic levels, with lost fares totaling $500,000 a day. As systems cut routes and schedules, riders may be less likely to return, making it even more difficult to restore service.

An expected federal focus on infrastructure never materialized over the past few years, passing ever-increasing responsibility to state and local governments. According to the Center on Budget and Policy Priorities, even before COVID state and local spending on schools, water treatment plants, highways and bridges was at a 30-year low. Infrastructure spending as a share of GDP in the vast majority of states is down significantly. A recent survey by the National League of Cities found that 64 percent of cities have already cancelled or delayed capital expenditures and infrastructure projects.

Every four years, the American Society of Civil Engineers issues a report card on the condition of infrastructure in the states. All state roads, bridges, rail infrastructure and waterways are graded, along with wastewater facilities, energy sources and dams. Capacity, funding and resilience are all considered. America’s cumulative grade in 2017 was a D+, the same as it had been four years earlier. Given the general lack of attention paid to infrastructure since then, it is doubtful that the next report, due this year, will show much progress.

Presidents run on promises, and Joe Biden is no exception. The new administration hopes to put the country on a path to net-zero carbon emissions by 2050. To achieve that goal, the new president plans to “create millions of good, union jobs building and upgrading a cleaner, safer, stronger infrastructure — including smart roads, water systems, municipal transit networks, schools, airports, rail, ferries, ports, and universal broadband access — for all Americans, whether they live in rural or urban areas.” Some help is on the way in the form of the COVID-19 relief bill signed into law in late December. The package includes $2 billion for airports, $10 billion for highways and $14 billion for mass transit. — David Kidd


You can read the full article by Alan Greenblatt, David Kidd and Carl Smith here.

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Alan Greenblatt, David Kidd & Carl Smith

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