Letter to the Hon. Steven Mnuchin, Secretary of the Department of the Treasury, and the Hon. Jerome Powell, Chairman of the Board of Governors of the Federal Reserve - Rep. Zeldin Urges Treasury & Federal Reserve to Allow Suffolk County to Qualify for Financing Assistance Through Municipal Liquidity Facility

Letter

Dear Secretary Mnuchin and Chairman Powell:

I write to express my appreciation for the work the Department of Treasury and Federal Reserve
are doing to stabilize the economy and underscore the need to provide additional assistance to
more local governments to ensure they have the ability to finance the delivery of essential services
for their residents.

On April 8, 2020, the Federal Reserve announced the establishment of the Municipal Liquidity
Facility (MLF) to help state and local governments better manage cash flow pressures in order to
continue to serve households and businesses in their communities. The MLF will purchase up to
$500 billion of short-term notes directly from U.S. states, including the District of Columbia, U.S.
counties with a population of at least two million residents, and U.S. cities with a population of at
least one million residents.

I greatly appreciate the creation of the MLF, but an eligibility threshold of two million residents
for U.S. counties is too restrictive and will box-out many large counties that are facing liquidity
issues in new issuances of debt. As you know, local governments issue short-term notes to help
smooth uneven cash flows so that they can finance the delivery of essential services.

The Federal Reserve has stated that it will continue to closely monitor conditions in the primary
and secondary markets for municipal securities and will evaluate whether additional measures are
needed to support the flow of credit and liquidity to state and local governments.

As the Federal Reserve evaluates whether additional measures are needed, I ask that the Federal
Reserve lower the county population threshold to one million residents to capture more counties
that are in desperate need of help.

Counties play a vital role in providing essential services, maintaining local infrastructure, and
investing in Americans' health. All levels of government have an important role to play in
responding to this pandemic, and it is paramount that large counties under the two million
population threshold are not left out of the equation.

Source