House Republicans are taking a wait-and-see approach with American Rescue Plan funds while many Pennsylvanians need help now dealing with pandemic-induced hardships.
Pennsylvania House Republicans could help a whole lot of Pennsylvanians right now with the $2.7 billion they’re sitting on.
That’s what’s left of the $7.3 billion in federal funding the state received back in May via the American Rescue Plan.
But Pennsylvania Republicans are taking a wait-and-see approach with that money, instead of using it right now to help the small businesses that have been upended by the pandemic, grant hazard pay to frontline and essential workers, or provide relief to those struggling to make rent and mortgage payments.
Rep. Joanna McClinton (D-Delaware County) believes what Republicans are doing is akin to watching a house on fire and doing nothing to stop it.
“There’s a fire happening now, why not put it out?,” McClinton said. “Why allow it to spread? People are in danger. Small businesses may not be here this time next year. And many of them could have benefitted from very small investments from this large pot of money that we have. So many different entities right now could benefit from our leadership just using a small portion of these funds. There could really be a boost in our economy to guarantee some stabilization when some folks out here are really having a hard time at the moment.”
Pennsylvania’s Share of COVID Relief Funds
The federal government disbursed American Rescue Plan funds to help states deal with the fallout from the pandemic. States may use the money to offset declines in their revenue collections (like sales and income tax) in an effort to maintain programs and services that otherwise might have faced cuts without federal aid. Pennsylvania has used more than half of what it received from the American Rescue Plan — $3.8 billion — for that purpose, according to a study by the Center on Budget and Policy Politics.
The study shows House Republicans spread around another $759 million for various initiatives, using nearly half of that amount ($377 million) to fund COVID-19 mitigation efforts. The rest went toward assisting nursing homes dealing with rising costs and decreased residency due to the pandemic; funding the PA State System of Higher Education; and the creation of the Construction Cost Relief Program, which provides assistance to entities facing increased building material costs due to the pandemic in the construction of low-income housing.
That leaves $2.7 billion and many other areas to address. States have through 2024 to appropriate all of their funds, and until 2026 to spend them.
Plans for Spending Pennsylvania’s COVID Relief Funds
Around the time Pennsylvania received its American Rescue Plan funding, House Democrats presented the Pennsylvania Rescue Plan, which calls for investments in business, infrastructure, public health, families, and workforce development. The Democrats’ plan offers a holistic approach to addressing the needs of Pennsylvanians in the pandemic. The plan includes funding for broadband connectivity, water and sewer improvements, and clean energy. Other line items earmark money for outdated school facilities, rewarding frontline workers, and property tax relief.
As the year draws to a close, Republicans haven’t budged on the Democrats’ funding plan or presented a plan of their own. They have the money. But they’re choosing to hold on to it as if they’re waiting for the proverbial rainy day.
“I’ve said on the floor of the House that it is raining right now,” said Rep. Jordan Haris (D-Philadelphia). “When you look at some of the schools, and some of the infrastructure in Philadelphia, it’s literally raining in some of those buildings. The Pennsylvania Rescue Plan talked about investment in infrastructure. We really need to look at the infrastructure of our state. That’s roads and bridges, but that’s also stuff like broadband in many places in Pennsylvania where there’s no connectivity. For me, infrastructure is also talking about child care and mass transit. If parents don’t have a place for their children while they work, and if people can’t get to work, they can’t work.”
House Republicans have told McClinton and Harris that they’re committed to spending the remaining $2.7 billion in federal funds, they just haven’t decided yet how. If the funds are not appropriated by the end of 2024, they have to be returned to the federal government. McClinton sees little chance of Pennsylvania facing a ‘use it or lose it’ scenario. Not with Republicans holding the purse strings, and Pennsylvania poised to play a crucial role in the 2022 midterm election.
“I suspect that sometime next year in the budget cycle some of the money will be spent so people can make themselves look better closer to the November election,” McClinton said. “We’ve got the governor’s race, we have the whole House, half of the Senate, and we’ll be completing a new congressional map. A lot of people will be watching. It’s very interesting how politics drives what occurs inside of the Capitol building.”
As that $2.7 billion in American Rescue Plan funding sits on ice in Harrisburg, while many Pennsylvania individuals and businesses continue to navigate pandemic-induced hardships, Harris stressed the importance of remembering who the money really belongs to.
“It’s Pennsylvanians’ money, not the Republicans’ money,” Harris said. “I don’t know where else we would allow someone to come into our house, take money out of our pocket that they know we need, and hold it. It’s like ‘We took your tax dollars and instead of investing in larger projects that we know will have a collective impact on people, we’re just holding that money in a bank account.
“Some of my friends on the other side of the aisle will talk about ‘Oh, excessive spending, excessive spending.’ There’s this weird construct of spending being a negative thing. This is not spending. This is investing. We have to stop allowing people to look at this as spending, and look at it as an investment in Pennsylvania.”