Gripped by a global pandemic, the economy nearly crashed, and the United States government quickly stepped up to help Americans in need.
The Coronavirus Aid, Relief, and Economic Security (CARES) Act was enacted in March 2020. It included $150 billion in direct, flexible funding to state, local and tribal governments known as the Coronavirus Relief Fund (CRF). A year later, Congress passed the American Rescue Plan (ARP) Act, which created the $350 billion Coronavirus State and Local Fiscal Recovery Funds for states, counties, cities, and tribal governments. Under the state portion, the State and Local Fiscal Recovery Fund (SLFRF), states would receive $195.3 billion. States must obligate SFRF by 2024 and spend by 2026.
Those federal stimulus packages were instrumental to state pandemic responses. The U.S. Treasury’s SLFRF continues to support their response to and recovery from the COVID-19 public health emergency.
Recipients of the SLFRF funds can use the money to replace lost public sector revenue, using this funding to provide government services up to the amount of revenue lost due to the pandemic; and to respond to the far-reaching public health and negative economic impacts of the pandemic, by supporting the health of communities, and helping households, small businesses, impacted industries, nonprofits, and the public sector recover from economic impacts.
In addition, SLFRF money can be used to provide premium pay for essential workers, offering additional support to those who have and will bear the greatest health risks because of their service in critical sectors. It has been used to invest in water, sewer, and broadband infrastructure, making necessary investments to improve access to clean drinking water, to support vital wastewater and stormwater infrastructure, and to expand affordable access to broadband Internet.
People Still Hurting: More Stimulus Checks
Even now, two and a half years after the start of the pandemic, some are still struggling to return to “normal.” The novel coronavirus pandemic hasn’t actually become endemic, meaning it will persist in a less fearsome mode like the flu or seasonal cold, but as vaccinations increase, it is already seen as less of a concern.
The lingering “side effect” of the pandemic has been the massive inflation created in part to consumer demand, and the free money given out by the government. Low inflation is actually necessary for the economy, but too much can cause a serious problem, and in the past year inflation has been seen as spinning out of control.
The good news is that after having hit a peak of 9.1 percent in June, inflation actually dropped to 8.5 percent last month. Yet, the cost of living continues to increase faster than any increase in wages.
To help residents who are dealing with higher food, housing, and fuel prices, several states – including Delaware, Florida, Georgia, Hawaii, Indiana, Minnesota, and New Mexico – have already started rolling out direct payments in the form of stimulus checks to residents. California, Colorado, Illinois, Massachusetts, South Carolina, and Virginia also have plans in place that could send direct aid to their respective residents.
Stimulus Checks: More Money Coming?
Last month, Democratic Socialist independent Vermont Senator Bernie Sanders also pushed for lawmakers to include an extension of the Child Tax Credit program in the recently-passed Inflation Reduction Act, a piece of legislation designed to lower prices and tackle climate change. His plan, if enacted, would have amounted to a monthly stimulus check for millions of Americans every single month.
Even Democrats ultimately didn’t agree with the Vermont senator on the issue of what would have provided a new stimulus check paid but would have also required a big tax increase.
The money does have to come from somewhere.
Expert Biography: A Senior Editor for 1945, Peter Suciu is a Michigan-based writer who has contributed to more than four dozen magazines, newspapers, and websites with over 3,000 published pieces over a twenty-year career in journalism. He regularly writes about military hardware, firearms history, cybersecurity, and international affairs. Peter is also a Contributing Writer for Forbes. You can follow him on Twitter: @PeterSuciu.