CARES Steering Committee Prioritizes Remaining Federal Funds For Unemployment Insurance Trust Fund

Dec 10, 2020

The committee has until the end of the month to spend the remaining funds Arkansas received from the federal CARES Act, unless Congress grants an extension
Credit Governor's Office

The committee in charge of distributing $1.25 billion dollars in federal funds to go towards COVID-19 expenditures spent its latest meeting preparing for two possible spending deadlines. It also declined to hear a proposal from one of its committee members that would have used COVID-19 funding to give payments to educators and staff members.

While the current deadline for all states to spend their allocated funding from the Coronavirus Aid, Relief, and Economic Security, or CARES, Act is the end of the year, an extension of that spending deadline from Congress is possible.

Currently, Arkansas has an estimated $27.7 million remaining to distribute. That’s a combination of $18.9 million in unspent funds and a return of $8.7 million from various state agencies. According to the Arkansas CARES Steering Committee, more returns could be expected.

The Committee spent the majority of its meeting Wednesday preparing for two spending scenarios. One where Congress does not issue an extension and they must spend all of its funds by the end of December, and another where Congress does offer an extension, offering the state more flexibility on how to spend its funding.

In both scenarios, the top priority of spending is for up to $50 million to go towards the state’s unemployment insurance trust fund, which was initially approved, but then put on hold so that said funding could go towards the state’s hospitals and nursing home facilities. While the state currently does not have that in spending, they are expecting more unspent funds from agencies to be returned, allowing for more to go towards the trust fund.

If Congress does not issue the extension, Elizabeth Smith, Secretary of the Department of the Inspector General, said there are still options on what the state could spend the remaining funds on after allocating as much of the $50 million to the unemployment insurance trust fund.

"Assuming Congress provides an extension past the 12/30/20 deadline, we would have $27 million at least available for the $50 million dollar need for the UI trust fund," Smith said.

Sen. Will Bond, D-Little Rock, a member of the committee, proposed the committee add to its next agenda health and safety payments towards the state’s teachers and staff. Initially the recommendation was for $1000 to go to each teacher and certified staff, as well as $500 to each classified staff member. However to reduce the cost of that proposal, Bond suggested reducing that payment from $1000 to $500.

"I would move that this committee consider that proposal at this time and vote on that proposal at this time and vote on that teacher proposal finally for the people that are… one, it’s incredibly important for our kids that are taking risks, the staff, the teachers with their lives. And also it’s hugely important for our businesses and economic development that our schools when they can remain reaching, whether virtual or in person for our kids," Bond said.

Bond’s action to place the teacher payment proposal on the agenda for the next meeting of the committee did not receive the needed votes to pass.

Ultimately the committee voted to have what Smith called a "blanket umbrella" form of appropriation for the Unemployment Trust fund if Congress does not grant an extension of the original deadline so that the committee will not have to "[scurry] around and running over at the last minute to the ALC to be able to sweep last minute funds to the trust fund."

The committee also approved of the reimbursement of just over $134,000 from the Department of Veteran’s Affairs for COVID-related expenses.