U.S.
States struggle to spend billions of dollars in leftover COVID relief money
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Around half of the $350 billion in COVID-19 pandemic recovery funds have not been used. The U.S. Government Accountability Office (GAO) released new spending analysis on Wednesday, April 10. The report revealed that since 2020, state and local governments spent $161.1 billion of the funds from the Coronavirus State and Local Fiscal Recovery Funds (SLFRF).
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Recipients are running out of time to spend the rest of the funds before the money needs to be reallocated. Governments have until the end of 2024 to allocate the money, and then they have another two years, until the end of 2026, to spend the funds.
Several factors delayed the process, from bureaucracy to project planning and implementing timelines for projects. Officials also need to figure out how to spend the awarded money efficiently and effectively.
The COVID relief funds cover the health and economic effects of the COVID-19 pandemic. It can be used for health care expenses, financial support for households and small business, aid for impacted industries, investments to infrastructure and public services and related projects.
According to the GAO, states have spent 53% of awarded funds, while localities have spent 47% of their funds. States received the majority of COVID-19 relief funds, accounting for around $325 billion of the money.
The GAO report found that all but eight states spent at least 25% of their allocated cash, while another eight spent 75% or more of their awarded funds.
[KARAH RUCKER]
NEARLY HALF OF THE 350-BILLION-DOLLARS IN COVID-19 RECOVERY FUNDS HAS BEEN LEFT UNUSED.
THAT’S ACCORDING TO A NEW ANALYSIS RELEASED THIS WEEK.
IT REVEALED ONLY 161-BILLION DOLLARS OF THOSE FUNDS HAD BEEN SPENT BY STATE AND LOCAL GOVERNMENTS – THREE YEARS AFTER BEING ISSUED.
NOW THE CLOCK IS TICKING TO SPEND THE REST OF IT BEFORE IT NEEDS TO BE REALLOCATED.
RECIPIENTS HAVE UNTIL THE END OF THIS YEAR TO ALLOCATE THE MONEY– AND UNTIL THE END OF 2026 TO SPEND IT.
SO, WHAT’S THE HOLD UP?
SEVERAL FACTORS– FROM BUREAUCRACY TO PROJECT PLANNING AND IMPLEMENTING TIMELINES.
OFFICIALS ALSO NEED TO FIGURE OUT HOW TO SPEND IT EFFICIENTLY AND EFFECTIVELY.
THE FUNDS COVER THINGS LIKE THE HEALTH AND ECONOMIC EFFECTS OF COVID-19.
THAT MEANS HEALTHCARE EXPENSES, FINANCIAL SUPPORT FOR HOUSEHOLDS AND SMALL BUSINESS, AS WELL AS INVESTMENTS TO INFRASTRUCTURE AND PUBLIC SERVICES.
STATES HAVE REPORTED SPENDING 53 PERCENT OF AWARDED FUNDS.
LOCALITIES SAY THEY’VE SPENT 47 PERCENT OF THEIR MONEY.
THE GOVERNMENT ACCOUNTABILITY OFFICE REPORT FOUND ALL BUT EIGHT STATES SPENT AT LEAST 25 PERCENT OF THEIR ALLOCATED CASH, WHILE OTHERS SPENT 75 PERCENT OR MORE OF THEIR AWARDED FUNDS.
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