Thousands Of Local Governments Fail To Report How They’ve Spent COVID-19 Relief Funds

By Brett Rowland (The Middle Sq.)

States and native governments have spent about 45% of the $350 billion given out via one federal COVID-19 reduction program, however monitoring that cash has been tough and 4,268 native governments – about 14% – have but to submit studies on how the cash was used.

The U.S. Division of the Treasury hasn’t publicly launched the names of the small native governments which have didn’t report again on what they did with the cash as a result of it doesn’t wish to put “undue strain” on them, in accordance with a report launched Wednesday.

When Congress handed the American Rescue Plan Act of 2021, it created the Coronavirus State and Native Fiscal Restoration Funds program. The U.S. Treasury allotted $350 billion in State and Native Fiscal Restoration Funds to tribal governments, states, the District of Columbia, native governments and U.S. territories. The cash was to assist cowl a broad vary of prices stemming from the pandemic, together with income substitute.

Two years later, states and the District of Columbia have reported 60% ($118.3 billion) of that cash has been obligated and 45% ($88.2 billion) has been spent as of March 31, in accordance with a U.S. Authorities Accountability Workplace report.

Native governments reported obligating 54% ($67.5 billion) and spending 38% ($47.9 billion) of their awards throughout the identical interval.

Hundreds of native governments haven’t filed required studies to the U.S. Division of the Treasury on how the cash was spent. Some 4,268 localities (14%), with a collective $3 billion in SLFRF awards, didn’t submit a required report back to Treasury that detailed spending as of March 31 by the April 30 deadline. And a pair of,155 of those 4,268 localities, with practically $606 million in mixed SLFRF awards, additionally didn’t submit a report within the earlier reporting cycle (spending as of March 31, 2022), in accordance with the report.

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U.S. Division of the Treasury coverage says that the division should ship as much as three emails notifying the recipient that the report is overdue and establishing a brand new reporting deadline. In some circumstances, Treasury officers reported they reached out to a recipient immediately by telephone to assist the native authorities submit a report. If that doesn’t work, the division should difficulty a discover of non-compliance with a request that the report be submitted by a brand new deadline, in accordance with the report.

In August, the U.S. Division of the Treasury despatched notices of noncompliance to three,544 of the 4,268 recipients that had not submitted studies as of March 31, 2023. The discover mentioned that Treasury might impose penalties, resembling returning funds, for failure to submit the report by the brand new deadline.

“Officers mentioned they didn’t ship notices to all 4,268 recipients for plenty of causes, together with that Treasury is working with some recipients which can be experiencing technical points with submitting the studies or have restricted administrative sources,” in accordance with the report. “Additional, Treasury officers informed us that some recipients had submitted studies after we accomplished our evaluation.”

Treasury officers additionally mentioned that the non-compliance notices would have been issued sooner, however that effort was hampered by a plan to difficulty the notices via the division’s award administration system, in accordance with the report.

“We are going to proceed to evaluate Treasury’s efforts to handle recipient non-compliance with submitting SLFRF challenge and expenditure studies,” the GAO reported.

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The Treasury Division hasn’t publicly recognized the hundreds of native governments that didn’t adjust to reporting necessities, partially, due to their dimension. Most are smaller native governments – usually serving fewer than 50,000 folks – known as non-entitlement items of native authorities (NEUs). Treasury officers mentioned these small governments have “restricted capability and different challenges that have an effect on their skill to report on time.”

Officers additionally mentioned these small governments “had been typically the ‘most nervous’ to just accept SLFRF awards (because of their restricted expertise with receiving federal funds), Treasury had issues over creating ‘undue strain’ or a ‘chilling impact’ on these recipients by publicly sharing details about who didn’t submit a report.”

Syndicated with permission from The Middle Sq..