Housing Grants Just a COVID Relief Rounding Error

By Steve Haner

Will $50 million be enough? Will that get all the Virginians who have fallen behind due to COVID-19 square on their rent or mortgage payments? Or is that amount, in a relief program now fleshed out by the Northam Administration, merely a start?

There is a hint on the program’s web page, now available. “Financial assistance is a one-time payment with opportunity for renewal based on availability of funding and the household’s need for additional assistance and continued eligibility.” A Senate committee was told last week that Governor Ralph Northam is considering spending hundreds of millions more for the same purpose.

This first $50 million is just the latest way that the billions of federal dollars flowing into Virginia as COVID-19 relief will be used. Within that operation, it is a  rounding error. On June 23, primary day, the Senate Finance and Appropriations Committee met virtually to be briefed, among other things, on how the four waves of federal assistance have been or will be spent.

The usual suspects of the Capitol Hill press corps may not have been there (or to be exact, may not have been monitoring the Zoom conference.) The primary results and the Phase 3 announcement held their attention. A week later the unreported reports are still worth reviewing and links to them follow below.

Secretary of Finance Aubrey Layne, in his presentation, estimated that Virginia has received more than $28 billion in direct aid – $6.5 billion direct to the state and local governments, $14.4 billion to state businesses in the Payroll Protection Program and $7.3 billion pledged to municipal liquidity facility loans to cover revenue losses. 

That does not, repeat does not, include the funds flowing to individuals through the supplemental unemployment insurance payments (the extra $600 per week) and the billions paid out in those individual stimulus checks to federal taxpayers. The unemployment bonus alone may exceed $1 billion per month.

In all, Layne estimated, the four bills which have passed Congress (so far) created 79 distinct paths for money to flow to the Commonwealth, its localities, its businesses, and its citizens. The most important to the state budget was an increase in the federal share of the cost of Medicaid, reducing the direct hit on state taxpayers by $650 million this year and next. Another $644 million has already been shared with local governments, not counting the $200 million Fairfax County got directly because of its size.

After all the state-level spending on emergency response, personal protective equipment, testing equipment and lab services and other direct costs of dealing with the disease, more than $2.2 billion remains unspent and presumably will carry into the new fiscal year July 1.

In a separate presentation, the committee staff took 46 pages to detail all the ways the federal money is propping up the state, its localities, colleges and hospitals. It also provides a bit of historical context, contrasting the trillions spent nationally this year with $10 billion in grants to the states during the 2001 Dot Com recession and the $275 billion provided states during the Great Recession starting in 2008. This time, the big bucks (so far) have gone to businesses and individuals.

Virginia hospitals and other health care providers have received $1.7 billion to date, in two waves. Four hospitals hit hardest by COVID received $75 million, directly, with another $75 million to nine “safety net” hospitals. An additional distribution for Medicaid-only providers is pending this summer.

With all the money that has flowed out, the list of pending requests totals another $1.2 billion. The staff reports that the Department of Housing and Community Development wants a total of $235 million for rental and mortgage relief, homeless housing, and broadband expansion (indeed, $50 million is the down payment.)

Just one university, Virginia, has asked for $260 million out of that pot, on top of what it has already received. Virginia Tech can get by with a mere $33 million. The Department of Social Services wants $171 million, “mainly for providing a stimulus benefit to immigrant families that are not eligible for a social security numbers.”

The sugar high this has provided to the state’s economy so far, with the sucrose drip right into the vein continuing into next year, explains why the state’s finances look far, far better than many expected. In fact, at one point in last week’s meeting, Senator Richard Saslaw, D-Fairfax, started pressing for an estimate on how much of the $2 billion frozen in the coming state budget could be released. Layne demurred.

This massive tsunami of federal largess, all borrowed from the future, is unprecedented, like so much that has happened in the past four months. It cannot continue. Yet it probably will. If you thought government spending would be among the COVID casualties, you were wrong.

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46 responses to “Housing Grants Just a COVID Relief Rounding Error

  1. “In all, Layne estimated, the four bills which have passed Congress (so far) created 79 distinct paths for money to flow to the Commonwealth, its localities, its businesses, and its citizens. ”

    So much money is being shoved into so many ratholes, sinkholes, and even a few holes in actual wallets so fast that even Aubrey Layne (a smart, capable, experienced person who understands finance much better than most people ever will) can only estimate how much is going into how many via the state.

  2. All the different cubby-holes are all headed for the same destination – the economy.

    For years, decades, the GOP has warned of terrible wages of fiscal sin – and now we’re here and it’s a big shrug….

    Oh but then the states have to actually have a balanced budget – but alas the Feds can borrow for that problem also.

    So how many are worried about the deficit/debt versus say.. wearing masks… 😉

  3. The states created a fierce recession by executive orders. Now the federal government is printing two trillion and counting to pay for it. Ain’t federalism great when played by feckless politicians?

    There is a term – runaway inflation – that comes from too much currency chasing too few goods. Last seen in the United States when Jimmy Carter was President. At that time, the Fed raised rates to the high teens to crush it. The problem today is that debt-to-GDP is so much higher that the United States could not pay the interest on its debt at those rates without printing even more money. Today’s breakdown of public order and COVID have combined to crush GDP. The left demands infinitely more spending that is not emergency related.

    Anybody have a good plan for combatting inflation under those circumstances?

    We appear destined to repeat some of the greatest mistakes in history – simultaneously.

    • The GOP rolled… they showed they don’t give a rats behind about deficit and debt… it’s was a boogeyman political strategy – it’s all out in the open now. I don’t trust them any more than traditional tax&spend types.. The GOP is just as bad or worse… LORD – look at TRUMP on this.. geeze.

      • Tax and spend? Republicans? Nah, there’s no tax. Borrow and spend.

        The lie is they are “conservative”. Sorry, lie is hostile. Inconvenient truth.

    • re: ” The left demands infinitely more spending that is not emergency related.”

      This latest increase in the deficit/debt did not come from the “left”.

      Also, the “theory” about debt was that you take it on during hard times and pay it back in good times… right?

  4. “This massive tsunami of federal largess, all borrowed from the future, is unprecedented, like so much that has happened in the past four months. It cannot continue. Yet it probably will.”

    Unprecedented? It has been a way of life since 1981. Neither party has ever stemmed the flow, but for a short few years, one did seek to use then-dollars.

    • Unprecedented might be the wrong word, but what was a pile of acorns is now a full oak forest….There was great angst about the TARP response to 2008-9, but in that case the government actually got paid back. Most of this PPP money is just a way to keep people on the payroll, and off unemployment, but otherwise perhaps not actually working. It will not be paid back.

      Given how broad the flow of funds, and how much is going to benefit the rich and comfortable, it’s impossible to complain about efforts to help the low income pay their rent and power bills. This pandemic has achieved more than a Bernie Sanders Administration would have dared dream.

      • And still 6-3, and 5-4 decisions by SCOTUS against the Religious Right and for precedent and the rule of law… Bernie may not have won, but he opened eyes.

        On the hmmm interesting note. I’m a cash spender, shunning credit cards. I rarely carry less than $200, so the ATM is a way of life. In the past 3 months, every cash withdrawal has been brand new bills. In 40 years, it was countably rare. Now 10+ in a row?

        • now that you mention that… yes… crisp new ones the other day…

        • I’ve been using ATMs for a long time and it has never been unusual in my experience to get new $20s from them—but I generally use my bank’s ATMs to avoid withdrawal fees. It’s probable that using new bills in the ATM prevents jams in the mechanism and that’s why they do it.

  5. Tis true about the TARP payback but at the time, it was fought tooth and nail by those opposed to the basic concept of the govt “bailing out” banks and auto and in fact, they advocated letting the auto companies go under. That was a measure of their fiscal attitudes.

    Today – the money flowed again without hesitation although now some of them don’t want to do anymore while the Fed is saying – “you better or even worse stuff will happen because of continuing unemployment”.

    The point is that there is no real deep analysis of what should be targeted and for how much – it’s literally throwing money like confetti hoping that it will filter down and find it’s way into the economy to try to inoculate against a true depression.

    Remember this:

    The GOP trotted it out – every day – had that clock ticking every hour. Now where is it?

    • It is good that computers and processors have gone to 64 bit words… 32 isn’t, and hasn’t since Bush 43, been capable of an single word integer representation.

      • “Nancy_Naive | June 30, 2020 at 7:35 am | Reply
        It is good that computers and processors have gone to 64 bit words… 32 isn’t, and hasn’t since Bush 43, been capable of an single word integer representation.”

        Umm 64-bit processors and operating systems have been around since the early 90’s (aka Bush 41).

        I’d suggest not making comments on topics you have zero knowledge of.

        • Try 1960s. The majority of such at that time were 8 and 16 bit, IBM and Honeywell were 32 and 36, but Boroughs, and CDC** had 60+ bit words. The majority of new processors now are 64bit. I suspect that’s true of cellphones, but they may not be. Anything bigger than a postcard manufactured today certainly is.
          The change over from 32 to 64 for anything as big as, or bigger, than a laptop came about in the last 20 years.

          ** “the perfect computer would be designed by CDC, built by Burroughs, and sold by IBM.”

          By the way, starting early with the personal attacks. It’s okay. It’s a normal reaction to the changes in civil rights.

          • Again, I would suggest not discussing topics to which you clearly do not understand. Also, if you going to quote, I suggest quotation marks or you’re just plagiarizing.

            Pointing out that you clearly have zero understand of computer architecture and shouldn’t comment on it, is not a personal attack. However, it’s understandable that you would make a statement as you clearly cannot debate your snark.

            “It’s a normal reaction to the changes in civil rights.”

            That statement is garbage, it means nothing.

          • Nancy_Naive

            Okay James. Stick to your word. Two unwarranted personal attacks in two minutes. I have resisted.

            Of course, you could just ban the victim and peace will fall on the house again.

          • “Nancy_Naive | June 30, 2020 at 9:26 am |
            2^32 – 1 unsigned is 4 trillion plus. Debt implies the sign. One of our pocket calculators has gone horribly awry”

            Umm nope it’s 4,294,967,295 that isn’t “trillions”.

            “1,000,000,000,000”
            That is 1 billion.

            Tell me more about 2^32.

          • Nancy_Naive

            Trillion — 10^12. Count your own zeros.

          • Nancy_Naive

            Oops. You are correct on max uint billions not trillions. Everything else, including not knowing a decimal from an int, you are wrong.

          • 000,000,000,000,000
            Tri Bil Mil Tho Hun

            Any questions?

          • Thanks for finally admitting your error, I was so afraid my EE didn’t teach me anything about computers and DATA types (sarcasm off).

            HEX isn’t a decimal, it’s just base16. Int is base1.

            Please feel free to quite while you’re behind.

          • I have fed your comments into my 1983 Commodore64 based fact checker and found them to be “mostly false’.

          • et tu? 60 not 80.

          • “See section 4.1 for decimal reprentat v integer https://www3.ntu.edu.sg/home/ehchua/programming/java/datarepresentation.html#zz-4.1

            That doesn’t add anything to your statement, nor does it prove how I somehow don’t know the difference between an INT and DEC variable type.

          • Actually, it does. You said, ~2.1(7fff…). The 2.1 is not an integer, nor would any integer need to be estimated using a float.
            But, I now know what to expect from you here, including a failure to ever admit an error.

          • Nancy_Naive | June 30, 2020 at 11:58 am |
            Actually, it does. You said, ~2.1(7fff…). The 2.1 is not an integer, nor would any integer need to be estimated using a float.
            But, I now know what to expect from you here, including a failure to ever admit an error.

            So now you’re onto strawmen?

            PS you’d have to use a Double, not a float.

            “But, I now know what to expect from you here, including a failure to ever admit an error.”

            That’s irony, straight up irony.

        • Now, to be specific, the topic was the debt. It passed 32-bit representation in the Clinton years. Bush 41 could still have represented the debt in 32.

          • Umm no, the Federal debt in 1977 was 705 billion dollars. The largest unsigned 32-bit int tops out at ~2.1 (7FFFFFFF Hex) billion. The last time the Federal debt could’ve been represented by a 32-bit unsigned int was prior to 1910.

            Learn what 32-bit and 64-bit means, then apply.

          • Nancy_Naive

            2^32 – 1 unsigned is 4 trillion plus. Debt implies the sign. One of our pocket calculators has gone horribly awry.

          • Nancy_Naive

            See uint max https://docs.microsoft.com/en-us/cpp/cpp/integer-limits?view=vs-2019

            Ah ha, 7fffffff is decimal. You don’t know the difference between decimal and integer.

          • What you provided doesn’t indicate 4 trillion.

            ULONG_MAX Maximum value for a variable of type unsigned long. 4294967295 (0xffffffff)

            That’s 4 billion.

            Actually, it’s a HEX.

          • Nancy_Naive

            that’s choice of base, the same number could be repressed in base base 32 if you’d like.
            The 7ff… v fff… limits indicate the use of exponent bits with a log-2 base, I.e., decimal representation. Most likely one of the ieee standards.

        • Just for the fun of it, here’s a story. In the 1980s, the state put out an RFP (ODU’s Engineering School) for a new computer system. IBM, Honeywell, and CDC responded, and after running the benchmark programs, ODU selected IBM claiming the others failed the precision tests for double precision benchmarks. Honeywell lodged a protest.

          My ex-brother-in-law sent me a copy of the benchmark code asking if I could find anything wrong. It took me 5 minutes. The code used a DATA statement to set PI at 3.1415926 fewer sigfigs than compared for the test results.

          • Just for fun, stop plagiarizing the work of other. Especially when you don’t understand what it says.

            “My ex-brother-in-law sent me a copy of the benchmark code asking if I could find anything wrong. It took me 5 minutes. The code used a DATA statement to set PI at 3.1415926 fewer sigfigs than compared for the test results.”

            I find that statement dubious as you don’t even know the max value of an unsigned 32-bit integer.

        • “Nancy_Naive | June 30, 2020 at 9:15 am |
          Okay James. Stick to your word. Two unwarranted personal attacks in two minutes. I have resisted.

          Of course, you could just ban the victim and peace will fall on the house again.”

          Again, I didn’t “personally attack” you and the fact that you’re belly aching about alleged “personal attacks” is just the very definition of irony.

          • Nancy_Naive

            An accusation of plagiarism without proof is a personal attack. Please cite the sources from which you make that statement.

          • How about I send you each other’s email and you can amuse just yourselves next time.

          • You lifted it from Wikipedia, care you try again?

          • General knowledge for those of us who lived it. Prove it, or you are guilty of a personal attack.

  6. Steve,

    I’d rather enjoy that, I don’t like to take up other peoples time when it’s not warranted.

    Sincerely,
    Matt

  7. Good reporting, Steve.

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