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CHARLESTON -- A federal deadline to spend what remains of the $1.25 billion in coronavirus aid to state and local governments by the end of the year was extended in the latest federal COVID-19 package being considered by Congress this week.
U.S. Sen. Shelley Moore Capito, R-W.Va., held a call with media members Monday afternoon in anticipation of the U.S. Senate passing a $2.4 trillion omnibus bill to keep the government funded through the fiscal year, with a $900 billion new coronavirus relief package.
One of the key provisions of that new coronavirus relief package is a provision allowing for states that received funding through the federal Coronavirus Aid, Relief, and Economic Security (CARES) Act for state and local reimbursements of coronavirus-related expenses to carry over any remaining funds. States can now use the funding they have left until Dec. 30, 2021.
More than $150 billion was distributed to states back in April through the CARES Act for state and local COVID-19 expenses, with West Virginia receiving $1.25 billion. According to U.S. Treasury guidance, the money can be used for necessary expenditures related to the state’s coronavirus response incurred between March and December. These expenses can include medical supplies, compensations for essential state employees and first-responder, or providing economic support to state businesses.
Gov. Jim Justice has said the last two weeks that he hoped Congress would extend use of the state/local CARES Act funds into the new year. Justice has also expressed hope since April that Congress would change the U.S. Treasury guidelines and allow the state, counties, and cities to use CARES Act funding to help keep budgets balanced.
Capito said lawmakers were able to get the extension language added, but not language allowing for budget backfill.
“(Justice) will have another year to spend the money, but it has to be under the same parameters of the original CARES Act, which means he cannot use that money to replace tax revenues,” Capito said.
Speaking earlier Monday during his coronavirus briefing, Justice said he was unaware at that time what the language of the bill would look like, but he was confident the state would get an extension.
“They’re now going to extend the CARES deadline and everything, so they will extend it past December 30th, but we’re still going to go with our plan that we have in place and how we’re moving forward with that,” Justice said. “At the end of the day, there isn’t going to be any backlog of money there on December 30th.
The deadline for spending those CARES Act dollars is Dec. 30 – just nine days away. According to the State Auditor’s Office, West Virginia has a cash balance of $751 million in CARES Act. Most of that is invested and accruing interest in the State Treasurer’s Board of Investments.
In a briefing last Friday, Department of Revenue Secretary Dave Hardy said the state could provide more than $1.203 billion in expenses to satisfy the U.S. Treasury Department. With an extension, the state will now be able to move those dollars into major expenses, such as covering unemployment insurance costs and additional testing costs for COVID-19.