The Biden administration on Monday started to distribute $350 billion to state and native governments from his $1.9 trillion COVID-19 aid invoice — with $12.7 billion going to New York state alone and billions extra flowing to cities and counties.
New York City is getting $4.3 billion.
But the cash comes with strings hooked up — the Treasury Department has an inventory of “eligible uses” that states and localities should adhere to.
Officials stated the funds have to be spent on public well being, to counteract the adverse financial results of the pandemic, to exchange misplaced public sector income, to offer bonus pay for important staff and for water, sewer or broadband web tasks.
The sum of money going to New York’s state authorities wasn’t a shock. It is in step with what was projected earlier than Biden’s $1.9 trillion stimulus bill was handed by Democrats — with no Republican help — in March.
Each of New York’s cities and counties additionally get a windfall of money. In addition to the Big Apple’s $4.3 billion, Albany will get $80 million and Buffalo will get $331 million. Additional funding for boroughs — from a pool allotted for every county in the state — pushes New York City’s complete appropriation near $6 billion.
Biden administration officers instructed reporters that the guardrails on makes use of are imposed to make sure the desire of Congress in placing the funds towards related makes use of.
Republicans final yr blocked some state and native support, arguing it amounted to a bailout of poorly run Democratic states, citing New York for example, that had long-running deficits.
Funds can’t be utilized by states to finance tax cuts or make pension fund deposits, the Treasury Department stated. They additionally can’t pay for long-planned infrastructure tasks unrelated to water and broadband. The use of funds have to be reported to the federal authorities.
On a background name with reporters, an official stated that the funds can be utilized via 2024 — and there may very well be broad justifications invoking racial disparities, similar to in well being and training, if these gaps worsened in the course of the pandemic.
But the principles broadly imply that governments can solely offset monetary holes in budgets that have been created by COVID-19, officers stated.
The “eligible uses” are broad sufficient, nevertheless, that states like California which might be reporting price range surpluses can nonetheless use their cash. An official instructed reporters on a background name that California, for instance, might put its $1.2 billion towards addressing homelessness.
The native authorities funds might be delivered in two tranches. Half might be delivered this month and one other batch will come in 12 months, regardless that that’s after the pandemic is anticipated to finish in the US.
For states, the supply is extra sophisticated.
“States that have experienced a net increase in the unemployment rate of more than 2 percentage points from February 2020 to the latest available data as of the date of certification will receive their full allocation of funds in a single payment; other states will receive funds in two equal tranches,” the Treasury Department stated.