WASHINGTON – The Biden administration announced Monday it will begin sending $350 billion in pandemic relief and economic stimulus funds to state, tribal, county and city governments this month, a major piece of the $1.9 trillion aid package Congress passed in March.
The program gives local officials considerable flexibility in how they spend the money to replace lost revenue, but a provision barring states from using the money to offset tax cuts has rankled Idaho Republicans. Many states, including Idaho and Washington, actually saw revenues rise during the pandemic.
“This $350 billion for the state, local, tribal governments is a critical component of the president’s plan to have a strong and equitable recovery,” Gene Sperling, the White House’s coordinator for the relief program, told reporters on a conference call.
“We all know that one of the things that held back the recovery the most after the Great Recession was the contraction of state and local government,” Sperling said, referring to the economic crisis he confronted as part of the Obama administration in 2009. “This is responding to the lessons of the past in a powerful way.”
State governments will receive the bigger share of the funds – $195.3 billion – with Washington getting roughly $4.4 billion and Idaho just shy of $1.1 billion. While Washington benefited from a formula that sent more money to states with higher unemployment, Idaho will receive more on a per-capita basis because each state was also allocated a flat $500 million regardless of population or jobless rate.
Counties will get a total of $65.1 billion, including more than $101 million to Spokane County and just over $32 million for Kootenai County. Metropolitan cities get separate allocations totaling $45.6 billion, with nearly $81 million to Spokane, about $16 million to Spokane Valley and over $8.6 million to Coeur d’Alene.
Tribal governments will share a total of $20 billion, but the White House did not immediately respond to a question about how much each tribe in the Inland Northwest will receive.
Local officials can choose to put the relief funds to a wide range of uses, including public health programs, salving economic pain caused by the pandemic, replacing lost revenue, higher pay for essential workers, and even investing in water and broadband infrastructure.
It cannot, however, be used to offset tax cuts or to add to a pension fund. Several Idaho Republicans – including Gov. Brad Little, North Idaho Rep. Russ Fulcher and Sens. Mike Crapo and Jim Risch – have objected to that provision, arguing states that are emerging from the pandemic in good financial shape should be allowed to use the money as they see fit. Idaho’s revenue went up by more than 10% during the past year, more than any other state.
Another unemployment-based provision is likely to frustrate GOP-led states that have reopened their economies more quickly. For states whose latest jobless rates are no more than 2% higher than in February 2020, only half of the total funds will be disbursed this month and the rest 12 months later, but states whose unemployment rates remain higher will get 100% of the money this month.
According to state unemployment data, Washington will receive its full allocation this month while Idaho will need to wait another year for the other half of its money. Tribal, county and city governments will get half of their allocated funds this month and the rest next year, regardless of local unemployment rates.
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