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May 11, 2020

King, Colleagues Introduce Bipartisan Bill to Provide States with Greater Flexibility with Coronavirus Relief Funds

Legislation prohibits use of federal resources for shortfalls, expenses unrelated to the pandemic

WASHINGTON, D.C. – U.S. Senator Angus King (I-Maine) joined a bipartisan group of Senators to introduce the Coronavirus Relief Fund Flexibility Act, legislation that would allow the federal relief funds provided to states and local governments in the Coronavirus Aid, Relief, and Economic Security (CARES) Act to be used to replace revenue shortfalls resulting from the pandemic. The legislation would apply retroactively to the enactment of the CARES Act, and addresses the fact that the decline of economic activity also has had a negative effect on state tax receipts. In addition to Senator King, the bill was introduced by U.S. Senators Dan Sullivan (R-Alaska), Sheldon Whitehouse (D-R.I.), Lisa Murkowski (R-Alaska), Shelley Moore Capito (R-W.Va.), and Kevin Cramer (R-N.D.).

“As a former governor, I know just how vital state and local government services are to communities across the country, especially at this time: these are the people dealing directly with the pandemic’s health threats or processing much-needed economic benefits,” said Senator King. “The pandemic’s economic fallout has drastically reduced tax revenue for state and local government, creating unexpected deficits and leaving these governments with the choice of raising taxes or firing essential personnel; neither of these options is acceptable. That is why the federal government must provide relief to ensure communities have the resources they need to weather this pandemic.”

Under the CARES Act, states, tribes, and municipalities have access to $150 billion in relief funding. The U.S. Treasury Department issued guidance restricting these resources from being directed toward revenue shortfalls. The Coronavirus Relief Fund Flexibility Act aims to clarify the matter and ensure these recipients can proceed with their pandemic recovery efforts, including keeping vital first responders on the payroll.

Senator King is an outspoken advocate for states and local municipalities to get the funding that they need to support their communities – earlier this week, he urged top Senate leaders to include “substantial, additional aid” for states in the face of the coronavirus pandemic and the subsequent economic impact. He also joined the Maine delegation to highlight the financial strain Maine’s state and local governments are experiencing as a direct result of the pandemic. Additionally, Senator King has stressed the importance of state and municipality funding during interviews with national media outlets, and on his social media channels

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