CARES Act – March 2020
The Coronavirus Aid, Relief, and Economic Security Act, also known as the CARES Act, is a $2.2 trillion economic stimulus bill passed by the 116th U.S. Congress and signed into law by President Donald Trump on March 27, 2020, in response to the economic fallout of the COVID-19 pandemic in the United States. The spending primarily includes $300 billion in one-time cash payments to individual Americans (with most single adults receiving $1,200 and families with children receiving more, $260 billion in increased unemployment benefits, the creation of the Paycheck Protection Program that provides forgivable loans to small businesses with an initial $350 billion in funding (later increased to $669 billion by subsequent legislation), $500 billion in loans for corporations, and $339.8 billion to state and local governments.
Some of the CARES Act funding flowed through the State of Ohio by way of the following legislation:
Ohio House Bill 481
- Appropriates $350 million of funding allocated to the state from the federal
“Coronavirus Aid, Relief, and Economic Security Act” (CARES Act) to counties,
municipalities, and townships to fund COVID-19 pandemic-related expenses. - Distributes funds based on the proportion of Local Government Fund revenue allocated
to subdivisions in 2019 (excluding local governments that receive direct federal funding
under the CARES Act). - Requires a subdivision, before receiving a payment, to adopt a resolution affirming that
the subdivision will spend it only on pandemic-related expenses as required under the
CARES Act. - Requires local funds unspent as of October 15, 2020, to be redistributed to local
governments that have spent their full allocation. - Requires subdivisions to return unspent CARES Act funds to the state by December 28,
2020. - Governor DeWine signed HB 481 on June 19, 2020.
Senate Bill 310
Originally CARES Act funding distribution bill, SB 310 was heavily amended to include the much-anticipated capital budget. The legislation authorized spending and appropriations of unspent CARES Act funds, in case the federal government was unable to pass an extension of the pending deadline. The President and Congress ultimately extended the CARES Act spending deadline. Governor DeWine signed SB 310 on December 29, 2020.
The Office of Budget and Management (OBM) is now accepting registrations from counties, cities, villages, and townships for Coronavirus Relief Funding so that funds can be quickly disbursed after HB 481 is enacted. The registration portal can be found at https://grants.ohio.gov/fundingopportunities.aspx. Note that each jurisdiction will need a DUNS number to complete the registration. Directions for obtaining a DUNS number along with how to register it in the federal SAM is located at https://grants.ohio.gov/helpfulresources.aspx#helpful-resources-DUNS-SAM-registration.
While the CRF disbursements for cities, villages, and townships will flow from the state through county auditors, OBM considers each local government to be a subrecipient of the state and will structure reporting and monitoring that way; therefore, we need to collect this contact information and have attempted to create a process that is streamlined and easy to use.
In addition, OBM has developed a 42-minute training to provide an overview of grants management for those who are new to managing federal grant funds or for those who would like a refresher. That training can be found at https://grants.ohio.gov/helpfulresources.aspx#helpful-resources-citizen-grant-training. If you would like to maintain a record of your training, you can register through the Ohio Learn system; if you do not need to maintain a record, you can view the training online through YouTube by clicking the direct link.
Please contact the Ohio Grants Partnership team at OBM at grants@obm.ohio.gov with questions.
To be eligible to receive a payment under division (C) of this section, the legislative authority of a county, township, or municipal corporation must adopt a resolution or ordinance affirming that the funds so received may be expended only to cover costs of the subdivision consistent with the requirements of section 5001 of the “Coronavirus Aid, Relief, and Economic Security Act,” as described in 42 U.S.C. 601(d), and any applicable regulations. Subject to division (F) of this section, until the legislative authority adopts this resolution or ordinance, the subdivision’s share of the money from the county coronavirus relief distribution fund shall remain in that fund. The legislative authority shall certify a copy of the resolution or ordinance to the county auditor and the Director of Budget and Management.
(E) Money received under division (C) of this section by a subdivision shall be deposited into a new fund in the subdivision’s treasury to be named the local coronavirus relief fund, which the subdivision’s fiscal officer shall create for this purpose. Money in that fund shall be used to cover only costs of the subdivision consistent with the requirements of section 5001 of the “Coronavirus Aid, Relief, and Economic Security Act,” as described in 42 U.S.C. 601(d). Money in a subdivision’s local coronavirus relief fund shall be audited by the Auditor of State during the subdivision’s next regular audit under section 117.11 of the Revised Code to determine whether money in the fund has been expended in accordance with the requirements of this section.
(F) Not later than October 15, 2020, the fiscal officer of each subdivision shall pay the unencumbered balance of money in the subdivision’s local coronavirus relief fund to the county treasurer, who shall deposit this revenue in the county coronavirus relief distribution fund. On or before October 22, 2020, the county auditor shall distribute all money to the credit of the county coronavirus relief distribution fund as follows to the county and to each municipal corporation and township in that county, unless the subdivision is an ineligible subdivision or paid an unencumbered balance to the treasurer under this division or the subdivision’s legislative authority has not adopted the resolution or ordinance required under division (D) of this section.
The guidance doesn’t define or provide additional detail to help determine when a budget requirement would prohibit a cost from being funded. However, local governments that adopt lawfully-binding budgets that restrict fund deficits could meet the requirement and allow CRF funds to reimburse costs that were originally budgeted in one fund to be paid out of another fund.
For example, if your budget ordinance restricts the ability to incur a fund deficit—and there’s now a significant decline in the revenues received to finance a fund’s activities—those costs might be allowed under CRF. It’s important to note, however, that such costs would still need to meet the other criteria in the CARES Act to be permissible. Additional guidance will be necessary to assist local governments that don’t adopt a lawfully binding budget or only adopt budgets for certain funds or departments.
Permitted Uses of Funds
The guidance clarifies what costs are permissible under the Coronavirus Relief Fund, noting that necessary expenditures incurred due to the public health emergency:
- Must be used for actions taken to respond directly to the COVID-19 public health emergency
- May include expenditures incurred to address medical or public health needs, as well as to respond to second-order effects of the emergency, such as providing economic support to those suffering from employment or business interruptions
- Can’t be used to fill shortfalls in government revenue to cover expenditures that wouldn’t otherwise qualify under the statute
Only certain costs not accounted for in the government’s budget most recently approved as of March 27, 2020 are permitted. Costs will, however, meet the above requirement if the cost:
- Can’t lawfully be funded using a line item, allotment, or allocation with that budget
- Is for a substantially different use from any expected use of funds in such a line item, allotment, or allocation
A cost isn’t considered to have been accounted for in a budget merely because it could be paid from a budgetary stabilization fund, rainy day fund, or similar reserve account.
Expenditures that are eligible for the CRF include:
- Medical expenses
- Public health expenses
- Payroll expenses for public safety, public health, health care, human services, and similar employees whose services are substantially dedicated to mitigating or responding to COVID-19
- Expenses incurred to facilitate compliance with COVID-19-related public health measures such as food delivery, distance learning, telework, paid sick and family and medical leave, maintaining jails, and caring for homeless populations
- Expenses associated with the provision of economic support in connection with COVID-19, such as grants to small businesses to reimburse the costs of business interruption caused by required closures, payroll support programs, and unemployment insurance costs that aren’t otherwise reimbursed by the federal government
Expenditures that aren’t eligible for the CRF include:
- Damages covered by insurance
- Payroll or benefits expenses for employees whose work duties aren’t substantially dedicated to mitigating or responding to the COVID-19 public health emergency
- Expenses reimbursed under any federal program
- Workforce bonuses other than hazard pay or overtime
- Severance pay
- Legal settlements
Consolidated Appropriations Act – December 2020
The Consolidated Appropriations Act, 2021 is a $2.3 trillion spending bill that combines $900 billion in stimulus relief for the COVID-19 pandemic with a $1.4 trillion omnibus spending bill for the 2021 federal fiscal year (combining 12 separate annual appropriations bills).The bill is one of the largest spending measures ever enacted, surpassing the $2.2 trillion CARES Act, enacted in March 2020.
While no additional state and local aid was provided, an extension of the deadline by which the Coronavirus Aid, Relief, and Economic Security (CARES) Act Coronavirus Relief Fund (CRF) resources must be spent was extended to Dec. 31, 2021. The legislation provided another round of direct payments, enhanced unemployment benefits, education funding, and aid to sectors still reeling from the economic fallout of the pandemic.
Related State Legislation
While the American Rescue Plan (see below) winds its way through Congress, Ohio officials introduced new legislation to spend more than $2 billion in coronavirus relief that has already been authorized.
The House and Senate rolled out four companion measures each with significant chunks of cash for schools, businesses and a variety of other Ohio entities. A good portion of the $2.15 billion in assistance stems from the relief package enacted by Congress late last year, but the state legislation also includes some money from the general revenue fund and other sources.
The companion measures are comprised of:
- $683 million for public schools; $155 million for private schools; $173 million for public health; $19 million for Educational Service Centers, Joint Vocational Schools and Ohio’s County Boards of Developmental Disabilities; and $8 million for the Adjutant General’s Office (SB 111; HB 170).
- $465 million in rent and utility assistance (SB 110; HB 167).
- $150 million for a second round of small business grants; $112 million for child care providers; $20 million for indoor entertainment grants; $10 million for new business grants; $4.7 million for fairs to get $50,000 each; and $3 million for the state’s two veterans homes (SB 109; HB 168).
- $100 million for bars and restaurants, and $25 million for lodging businesses (SB 108; HB 169).
American Rescue Plan – March 2021
The American Rescue Plan is a $1.9 trillion economic stimulus package signed by President Biden to speed up the United States’ recovery from the economic and health effects of the COVID-19 pandemic and the ongoing recession. The package builds upon many of the measures in the CARES Act and in the Consolidated Appropriations Act, but it also has it own provisions.
View a summary of the American Rescue Plan
Ohio will is receiving nearly $5.4 billion as part of the package, with another $6.6 billion going directly to 37 Ohio cities and all 88 counties as part of the $350 billion program created under the American Rescue Plan to help state and local governments. Work is ongoing with the treasury department to get money for Ohio townships, which were left out of the allocations.
More information from the U.S. Treasury Department
