states may get more spending flexibility with new relief bill

Congress is expected to take up legislation this week addressing new COVID-19 relief spending.
Louisiana Republican Senator Bill Cassidy and New Jersey Democrat Bob Menendez are crafting a bill that would not only include $500 billion in expenditures, but would also give the states more leeway in how they want to apply those funds.

The legislation comes after the National Governors Association issued a statement noting that without the relief, “States will be confronted with the prospect of cuts to essential services. This will make it much harder to have a strong economic recovery, which is a top priority for the President and for all of the governors.

Both NGA chairman Larry Hogan, who is the governor of Maryland, and NGA vice chairman Andrew Cuomo, the governor of New York, say the $500 billion is especially needed now by the states due to a loss of corporate, gasoline, personal, and sales tax revenue.

Legislation as proposed by Cassidy and Menendez is expected to apportion federal spending to the states based on their percentage of the national population, while also providing funds based upon infection rates within the individual states.
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As the new phase four of the relief legislation is being considered, the NGA has also asked the Treasury Department to free up rules on how the $150 billion approved by Congress last month under the Coronavirus Aid, Relief, and Economic Security Act can be used in the states.

​By Garry Boulard

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