Louisiana will run out of federal coronavirus money before it pays out grants to all eligible small businesses and local government agencies seeking dollars from COVID-19 aid programs created by Gov. John Bel Edwards and lawmakers.
Officials running the programs told the joint House and Senate budget committee they received more applications than the dollars available.
“We have plenty of needs,” said Commissioner of Administration Jay Dardenne, the governor’s chief budget adviser.
The dollars come from $1.8 billion in direct coronavirus aid that Louisiana received from Congress. The Democratic governor and majority-Republican Legislature spent more than half the money to fill gaps in Louisiana’s state budget.
About $855 million remaining was split by lawmakers among several assistance programs. Nearly $525 million was earmarked to reimburse local government agencies’ virus-related expenses. Another $260 million was steered to small business grants. And $50 million was set aside for one-time payments to front-line workers who stayed on the job in the pandemic’s early days. The remaining $20 million was set aside to pay for administrative expenses to run those programs.
Dardenne, whose office oversaw the local government reimbursement, said that program has spent all of its money and still has $431 million in outstanding, eligible expense applications from municipalities across 35 parishes.
“There is a huge outstanding request that is unable to be satisfied right now,” he said.
Red River Parish was the only parish that declined to submit any coronavirus expenses for reimbursement, Dardenne said.
Senate Republican leader Sharon Hewitt, of Slidell, objected to the way dollars were divvied up to police juries, sheriffs’ offices, towns, cities and other local government entities to pay for protective equipment, cleaning supplies, overtime expenses and other virus response needs.
She pointed to what she considered discrepancies in how parishes were paid, with her home of St. Tammany Parish receiving reimbursement for 26% of its eligible requests, compared with 73% in nearby Jefferson Parish.
“I just don’t understand how we can look at that and say that’s an equitable system,” Hewitt said.
Dardenne’s office calculated the maximum reimbursement amount available by parish using a formula based on the parish’s confirmed coronavirus case count and population.
“The math was the math,” he said. “It was not favoring one parish over another.”
New Orleans Mayor LaToya Cantrell unsuccessfully asked lawmakers earlier this year to shift millions more to the local government program. After receiving $67 million, the city still has more than $79 million in eligible expenses that the program didn’t reimburse because it ran out of cash, according to data Dardenne provided to lawmakers.
Treasurer John Schroder, the Republican managing the small business grants, said nearly all the program’s money has gone out the door, and the remaining dollars will be sent to applicants by the end of November. About 20,000 businesses will receive money, and Schroder said another 6,000 applicants were deemed eligible, but the program has no money to give them.
The only program that won’t spend all its allocated cash involves the $250 one-time hazard payments to workers, overseen by the state revenue department. More than 142,000 people received the one-time assistance, and another 40,000 applications remain under review.
But of the $50 million allocated, Revenue Secretary Kimberly Robinson told lawmakers that more than $2 million won’t be spent on the $250 checks because thousands of applicants for the money didn’t meet the income and job eligibility requirements set by lawmakers.
Lawmakers continue to hope for another round of aid from Washington. Legislative leaders said they intend to shift Louisiana’s unspent dollars — along with $5 million in federal aid allocated to Louisiana’s judicial agencies that wasn’t used — to other programs in December. They didn’t specify where the money will go.
Congress required the coronavirus dollars be spent by the end of December or states lose whatever aid is remaining.
“I don’t want to return money,” said Senate Finance Chairman Mack “Bodi” White, a Baton Rouge area Republican.
Topics Legislation Commercial Lines Louisiana Business Insurance COVID-19
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