Legislators race December 31 deadline to get CARES Act budget spent

Alabama News

HUNTSVILLE, Ala. — Alabama has been given nearly $2 billion in CARES Act Funding from the federal government.

Nearly all of it has been allocated to areas of need, but just because it’s been allocated, that doesn’t mean it’s getting spent just yet.

Less than $300 million has been spent so far. State leaders have until the end of the year to spend the remaining $1.4 billion, and with the largest area of need still in flux, legislators are already starting to re-allocate some of those funds.

State Sen. Arthur Orr of Decatur stirs on a six-person committee working with the governor’s office to transfer funds from different appropriation classes that may not be spending what was originally given to them.

“That’s quite frankly where we found some of the $300 million for the unemployment trust fund,” Orr said. “We had money that we had originally put in the Department of Corrections budget.”

Transferring the money is more complicated than writing a check. The Department of Treasury works with legislatures to define what qualifies as a proper expenditure for the relief fund, the unemployment trust fund being one in urgent need throughout the pandemic.

“There’s been a real run on that trust fund,” Orr said. “We started the year with well over $700 million and that’s now down to less than $200 million. What that means is businesses will be taxed. We have to keep the unemployment compensation trust fund at certain levels, so this $300 million will make a large difference.”

Orr explained that if demand for unemployment funds continues to push the fund below acceptable levels, the committee would be talking in terms of hundreds of millions of dollars to prevent a tax increase occurring on businesses.

With the devastation of Hurricane Sally on the coast in addition to an already hurting workforce, Orr expects the unemployment fund to remain a centerpiece in the coming months unless there is another catastrophe.

“If we have a spike in virus infections in October and the hospitals are slammed and sinking, that may become the number-one priority,” he said.

As far as the breakdown of expenditures listed on Alabama’s Coronavirus Relief website, pieces of the budget currently listed could be moved before the December 31st deadline.

“It’s just going to cause for a lot of flexibility between this legislative committee of six and the governor’s office to make some really smart decisions in the months ahead,” he said.

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