Congress recently passed another round of economic relief to deal with the continued fallout of the COVID-19 pandemic. The Biden Administration’s proposed package totaling $1.9 trillion cleared both the U.S. Senate and U.S. House of Representatives bringing a slew of new dollars to everything from direct stimulus payments totaling $1400 for individuals making $75,000 and below and couples making $150,000 or below along with an additional $1400 in aid for dependents of individuals or couples who fall under the same criteria. This is the third round of direct stimulus for individuals with previous payments being touted as supporting the struggling economies of both state and local governments. Additionally, the latest round of COVID-19 relief extends expanded unemployment benefits for individuals by an additional $300 per month running until September 2021.

Local and state governments finally were winners in the COVID 19 stimulus package. In March of 2020, Congress passed emergency aid which provided some funds to state and local governments to use in response to the COVID-19 outbreak but were restricted to only those needs which were a direct result of the pandemic and could not be used for revenue loss. This plan includes $350 billion in funds to support economic declines for state and local, tribal, and U.S. territories governments. Ohio alone is estimated to receive approximately $11 billion in funding with over half of those dollars going directly to local governments i.e. cities and counties and approximately $5 billion coming to the state.

While official figures and additional guidance from the U.S. Department of Treasury is expected soon, the new funds will be provided to local and state governments based upon the Community Development Block Grant formula.  This approach will provide more funding to local and state governments with higher poverty rates. The bill authorizing the new spending provides some restrictions on the use of the new dollars but does permit them to be used to replace lost revenue due to the pandemic as well as providing governmental services, infrastructure investment and economic relief to businesses and non-profits. The funds are restricted and cannot be used to offset losses in pension obligations or be used to lower taxes. 

The relief package provides substantial investment in a number of other areas, including:

  • $160 billion for COVID 19 testing and vaccination support to states
  • $130 billion for K-12 schools
  • $35 billion for higher ed
  • $30 billion rental assistance
  • $25 billion for childcare providers
  • $15 billion for small business assistance
  • $5 billion for homeless programs
  • $3 billion in Economic Development Administration funds 

Federal COVID 19 stimulus dollars will be flowing again soon and can have a major impact on a wide range of local institutions.

Please contact Dave Robinson at Montrose Group at drobinson@montrosegroupllc.com if you need assistance in addressing any economic development or lobbying matters.