States and cities are only slowly issuing the federal pandemic

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When Congress considered a massive COVID-19 bailout earlier this year, hundreds of mayors across the United States advocated billions in “immediate action” aimed at shoring up their finances and revitalizing their communities.

Now that they have received it, the local officials are taking their time before actually spending the windfall.

By the summer of this year, the majority of major cities and states hadn’t spent a penny on the American bailout plan advocated by Democrats and President Joe Biden, according to a review of the first statutorily due financial reports by Associated Press. According to the AP analysis, states had spent only 2.5 percent of their original allocation, while large cities had spent 8.5 percent.

Many state and local governments reported that they were still working on plans for their share of the $ 350 billion that can be spent on a variety of programs.

Although Biden signed the law in March, the Treasury Department didn’t release the money and spending guidelines until May. By then, some state legislatures had already completed their budget chores for the next year, leaving the governors with no powers to spend the new money. Some states waited several more months to ask the federal government for their share.

Cities sometimes delayed decisions while soliciting suggestions from the public. And some government officials – still trying to figure out how to spend previous rounds of federal pandemic aid – simply saw no urgent need for additional money.

“A lot of money was spent there. I think it’s a good sign that it wasn’t spent lightly, ”said Louisville Mayor Greg Fischer. He was president of the U.S. Mayors’ Conference when more than 400 mayors signed a letter urging Congress to swiftly pass Biden’s plan.

The law gives states until the end of 2024 to spend commitments and the money until the end of 2026. All funds that are not committed or spent by these dates must be repaid to the federal government.

The Biden government said it was not concerned about the early pace of the initiative. The aid to governments is intended to both “address any crisis needs” and “provide longer-term firepower to ensure a lasting and equitable recovery,” said Gene Sperling, coordinator of the American rescue plan at the White House.

“The fact that you can distribute your expenses is a feature, not a bug, of the program. It is on purpose, ”Sperling told AP.

The Treasury Department set an aggressive reporting schedule in an attempt to stimulate local planning. By August 31, states, counties, and cities with an estimated population of 250,000 or more were required to submit reports detailing their spending for the previous month and future plans.

More than half of the states and just under two-thirds of the roughly 90 largest cities reported no first-time editions. Governments reported future plans for about 40 percent of their total funds.


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