Six Republican senators are demanding the Biden administration rescind a new rule that gives states and municipalities more time to find ways to spend billions in unused federal COVID-19 relief despite the pandemic having ended.
In a letter Tuesday to the Treasury Department, the GOP senators said Congress “will have no choice” but to try to reverse the decision under the Congressional Review Act if the administration doesn’t stop the new policy.
“It is imperative that Treasury rescind this rule immediately,” the senators wrote. “With our national debt hitting unprecedented levels, the federal government must act as responsible stewards of the taxpayer’s dollars. An extension of COVID-19 era programs is especially perplexing as this administration ended the federal public health emergency for the pandemic on May 11, 2023.”
The Republicans who signed the letter are: Sens. Eric Schmitt of Missouri, Ron Johnson of Wisconsin, Mike Lee of Utah, Mike Braun of Indiana, Rick Scott of Florida and Roger Marshall of Kansas.
The rule issued by the Treasury Department before the Thanksgiving holiday relaxes how states and municipalities must legally obligate money from the $350 billion Coronavirus State and Local Fiscal Recovery Fund by the end of next year.
The fund was created as part of the $1.9 trillion American Rescue Plan signed by President Biden in 2021.
The right-leaning Economic Policy Innovation Center said the move is allowing states and local governments to hoard money from a $100 billion pot of unspent pandemic relief, after billions already have been spent on golf courses, lottery prizes in New Mexico for people who got the COVID-19 vaccine and legal services for asylum seekers in Illinois.
The think tank’s report said the new Treasury rule is creating a Biden “slush fund” for communities heading into the presidential election year.
States and local governments so far have obligated only 56% of the program’s total $350 billion appropriation.
A Treasury spokesperson told The Washington Times last week that the existing deadline for state and local governments put in place by Congress has not changed. Treasury did not provide an immediate response to the senators’ letter.
“To address grantee questions, Treasury clarified what recipients must do to meet a particular December 2024 cost incurred deadline that was established by Congress,” the spokesperson said.
The senators said Treasury is using a “tortured definition” of when and how communities must “obligate” their pandemic funding. They said the law is clear that recipients must specify how the money is being spent by Dec. 31, 2024, and to spend it by Dec. 31, 2026.
“This rule is an insult to our basic rules of statutory construction and interpretation, as well as a complete misuse of our limited tax dollars,” the senators wrote. “As our nation’s debt is nearly $34 trillion — over $255,000 per taxpayer — Treasury must discard the rule immediately.”
The lawmakers said there are “serious concerns about waste within” the pandemic program, but “it does not appear that recipients have had difficulty obligating or spending funding.”
They said Treasury’s new interpretation of the law is “confounding.”
“There must be a present and definite agreement for an obligation to occur — not a future intention to come to an agreement,” the senators wrote. “Therefore, Treasury’s new definition — permitting recipients to make future agreements to spend [program] funds in 2025 and 2026 — stretches the word ‘obligation’ outside of any plain use of English.”