WASHINGTON, DC – As Congressional leaders near agreement to a new, roughly $900 billion COVID-19 relief package that would boost unemployment insurance (UI) benefits and include a second round of direct payments, but would omit additional state and local funding and a liability shield, U.S. Senator Jack Reed (D-RI) is working to help states and municipalities by at least extending the deadline for them to utilize federal CARES Act assistance from the Coronavirus Relief Fund (CRF).

Senator Reed led the successful effort to create the $150 billion Coronavirus Relief Fund (CRF) in the CARES Act (Public Law No. 116-136), and successfully secured a small state minimum of $1.25 billion in the law.

The Coronavirus Relief Funds may be utilized by states and local governments to help with urgent needs and cope with the public health and economic impact of the novel coronavirus (COVID-19).  Under the law, states may use the federal funding for costs related to the COVID-19 public health emergency incurred between March 1 and December 30, 2020.  This federal funding was provided to relieve pressure on state budgets and meant to ensure they can maintain public services.

But Senator Reed says that Congressional delays of additional fiscal relief and the uncertainty created by the U.S. Treasury Department’s imposition of bureaucratic burdens on states has held back opportunities for responsible planning and recovery.  Senator Reed wants to provide states and municipalities more time to allocate the CRF funds to effectively fight the latest surge in infections and help small businesses.

“As infection rates spike and American families, businesses, communities, and states continue to struggle, it is essential that Congress provide targeted relief.  Extending the time horizon states and local governments have to allocate CRF money will help prevent unnecessary layoffs of teachers, police officers, and firefighters and cuts in public services,” said Senator Reed.  “States shouldn’t suffer because some in Congress took so long hammering out a federal COVID relief package that it created a lot of uncertainty and forced state and local leaders to delay fiscal decisions.  Giving state and local leaders additional time wouldn’t raise the price tag of this bill, but it would go a long way toward helping our economy.”

Senator Reed says that passing an emergency COVID relief package is long overdue and that bipartisan compromise is necessary.  He noted that Congress will have to take up another comprehensive rescue package in the new year but that there is need for immediate action to help stop surging rates of infection and unemployment.

It has been 264 days since Congress passed the CARES Act, after initial resistance from Senate Republican leaders.  Now, several key programs will expire in a matter of days.

The U.S. Department of Labor announced a surge in initial jobless claims last week, with 853,000 recorded, the highest level since mid-September, and a rise of 137,000 over the previous week.

“The infection rate is surging, job losses are mounting, and Main Street is struggling.  The compromise on the table represents the barest minimum of what is needed.  More work needs to be done when the new Congress and Administration are sworn in and I will continue pressing for more relief.  I urge Congress to work together now and fund the government and extend these emergency relief programs for families across the country,” stated Reed.  “Congress found a way to pass the CARES Act in March, and now that COVID-19 rates have spiked, we must act decisively once again to help people and save lives and livelihoods.”

In May, Senator Reed introduced the State & Local Emergency Stabilization Fund Act (S. 3671), which would provide additional state and local funding and cut needless red tape that was bureaucratically imposed by the Trump Administration to try to constrain states from spending the CRF money that Congress unanimously approved to save lives and help rescue our economy.  Reed’s bill would also give states and local governments over a year to spend the CRF money.