GOP Lawmakers Challenge Treasury on COVID-19 Fund Management

Congressional Letter Demands Rollback of Rule Extending Use of ARP Funds.

WASHINGTON, D.C. – In a bold move, Congressman Ben Cline (R-VA), Chairman of the Republican Study Committee’s (RSC) Budget and Spending Task Force, along with RSC Chairman Kevin Hern (R-OK), and 34 other Congressional members, have sent a strongly-worded letter to U.S. Treasury Secretary Janet Yellen. The correspondence demands the Treasury Department withdraw an Interim Final Rule (IFR) that extends the use of unspent COVID-19 funds from the 2021 American Rescue Plan (ARP).

The IFR allows state and local governments to obligate COVID funds past the original December 31, 2024, deadline by submitting a spending plan by April 30, 2024. This rule has been criticized by the GOP lawmakers for failing to comply with congressional statutes and potentially leading to further inflation and wasteful government spending.

Brittany Madni, Executive Vice President of the Economic Policy Innovation Center (EPIC), echoed these concerns. EPIC supports the letter, asserting that the Biden Administration’s handling of the Coronavirus State and Local Fiscal Recovery Fund (SLFRF) reflects government waste and a critical opportunity for taxpayer savings. The EPIC criticizes the Treasury’s new Hoarding Rule for allowing states to reserve funds for later unspecified uses.

The letter lists examples of what the signatories consider inappropriate uses of SLFRF funds, ranging from golf course improvements to funding for sports stadiums and entertainment venues. The GOP representatives argue that such expenditures stray from the fund’s original purpose of supporting COVID-19 response and recovery.

As the Biden Administration approaches its final year of the first term, the letter raises questions about the political deployment of these funds. With approximately $152 billion of the SLFRF still unobligated, the letter urges the Treasury to exercise care in managing the program.

The lawmakers also claim that the Treasury’s actions violate the Anti-Deficiency Act (ADA), which prohibits the department from expending and obligating funds inconsistently with Congress’s direction. The letter demands an immediate explanation or withdrawal of the regulations.

The signatories conclude that increased oversight of the Executive Branch’s use of emergency COVID-19 funding is imperative. They argue that the SLFRF program, in particular, requires more scrutiny and accuse the Biden Administration and Treasury of mismanaging and unlawfully expanding the program for political purposes.

This letter signifies a significant challenge from Congressional Republicans to the Treasury Department’s handling of COVID-19 funds. The outcome of this dispute could have far-reaching implications for the management of federal emergency funding.

Full letter here.