Apr 19, 2021 - News

Iowa delays stimulus spending decisions over lack of guidance

Illustration of a hundred dollar bill with Benjamin Franklin missing, in his stead is a sign that says, "Will return at" with a clock displayed without hands.  

Illustration: Aïda Amer/Axios

Vague language associated with last month’s federal stimulus have prompted local and state governments to delay decisions about how to spend their share of the $1.9 trillion.

  • That's according to multiple state and local officials during a Taxpayers Association of Central Iowa meeting last week.

Why it matters: There are spending deadlines and concerns that our local governments won’t be able to fully or best utilize allocations.

Details: A big goal of the legislation was to help reopen schools and quickly replenish budgets dented by unexpected spending and less revenue during the pandemic.

  • A White House briefing in January called for "immediate, urgent action by Congress."

Yes, but: Now educators and officials are stuck in limbo with unresolved questions about how they can use the funds. Those include:

  • Deadlines: Must the money must be spent or simply allocated in budgets before deadlines? (Infrastructure, for example, can take years of planning and governments don’t want to commit to projects without financial certainty.)
  • Qualifications: Can the money be spent on some previously planned or budgeted items?
  • Double dipping: Are projects partially paid with previous stimulus allocations eligible for funding from the latest stimulus?

What they're saying: "We’re just trying to encourage people to be patient as we’re trying to get guidance ourselves," Tom Cooley, bureau chief of the Iowa Department of Education, said during the TACI meeting.

By the numbers: Iowa’s government allocations are almost $2.7 billion.

  • Public schools will get almost $700 million.
  • DSM and Polk County governments are each getting roughly $95 million.

Of note: The U.S. Department of Treasury did not respond to a request for comment.

  • We’re not alone: Government officials in other states have also said they're waiting for more guidance on the stimulus spending before solidifying plans.

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