Local governments continue to misuse federal relief funds.
In response to the Covid-19 pandemic, the federal government and many state and local governments stifled the economy by restricting industry or, in some cases, outright prohibiting small businesses from operating. This led to the permanent closure of many businesses and the loss of over 4.2 million jobs between February 2020 and October 2021. To maintain these drastic efforts taken in the name of defeating Covid-19, President Biden signed the American Rescue Plan Act (ARPA) into law on March 11, 2021.
ARPA is an economic stimulus package worth $1.88 trillion with expansive provisions ranging from vaccine and testing efforts to the expansion and creation of numerous welfare programs. One such program authorized by ARPA was the Coronavirus State and Local Fiscal Recovery Funds (SLFRF) program. The SLFRF was, in part, a response to the loss of tax revenue caused by the aforementioned restrictions on private industry. The SLFRF provided $350 billion “to state, territorial, local, and Tribal governments across the country .”
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