Wisconsin Receiving Less Than Expected From Federal Stimulus
Wisconsin will receive $700 million less than initially expected in federal coronavirus relief money and it will arrive in two payments a year apart, news that Gov. Tony Evers and U.S. Sen. Tammy Baldwin said Tuesday was problematic.
The state was informed Monday of the split in payments, and the total it would receive. Evers and Baldwin asked U.S. Treasury Secretary Janet Yellen on Tuesday to reconsider breaking the funding into two.
“This will significantly reduce the funding that will be available for Wisconsin’s current pandemic response operations and to continue to meet immediate needs and restore economic well-being,” Baldwin and Evers wrote.
Evers has emphasized wanting to spend the money quickly to help those most hurt by the pandemic. He has cited that desire for speed in vetoing Republican-authored bills that dictated how the money would be spent. The governor has sole authority in deciding how to spend the money.
Republicans who control the Legislature have called on Evers to meet with them to discuss how the money should be spent. Rep. Mark Born, co-chairman of the Legislature's budget committee, renewed that call on Tuesday.
“Regardless of the exact amount, there’s still a lot of federal money coming into this state," he said. “Right now, that’s all within the governor’s decision making and we hope he will include us in that soon.”
Evers has announced generally how he wants to spend the money, while holding off on details pending federal guidance. The U.S. Treasury Department sent guidelines Monday about how the money can be spent and the application process for states to begin receiving the money.
The Congressional Research Office initially estimated that Wisconsin would receive $3.2 billion, but the Treasury Department now says the state will receive $2.5 billion.
Evers had said he wanted to spend $2.5 billion on economic relief for families, tourism, workers and small-business owners, as well as $500 million on the continued pandemic response and $200 million on infrastructure, including broadband.
Evers has not said how the state’s reduced payment will affect his spending plans.
Wisconsin will get its money in two payments because the state’s unemployment rate of 3.8% in March was not more than 2 points higher than it was in February 2020, when it stood at 3.5%. Thirty states were getting their money in two batches, while 20 others had worsened unemployment rates that allowed them to get it all at once.
Evers and Baldwin wrote that the split in funding “does not necessarily reflect the urgency or the level of need that many businesses, families, workers, and community organizations have right now. ... A delay of up to a year in being able to access these funds in Wisconsin risks slowing our economic relief and the successful recovery progress we’ve made to date.”
States have wide latitude to use the federal money to make up for revenue losses during the coronavirus pandemic. Among other things, they also can put the money toward public health and mental health care; aid to small businesses, the unemployed or households; water, sewer and high-speed internet infrastructure; or extra pay for a broad range of “essential workers,” including teachers, janitors, truck drivers and those in health care, food and public safety jobs.
Federal guidelines prohibit the money from being used to pay off debt, cut taxes or set aside in a reserve fund.