by James A. Bacon
About two weeks ago, Secretary of Finance Aubrey Layne floated a trial balloon on Bacon’s Rebellion, suggesting that Virginia do something “transformational” with the $6.8 billion the federal government is showering upon Virginia in the latest COVID-relief package, the American Rescue Plan.
Transformational? Like what? Like patching up Virginia’s under-funded unemployment insurance program, extending affordable broadband into every corner of the state, or fixing antiquated school buildings, Layne suggested.
Now others are beginning to entertain similar thoughts. Reports Michael Martz with the Richmond Times-Dispatch:
“This is an extraordinary opportunity to meet long-term obligations and challenges,” said Michelle Gowdy, executive director of the Virginia Municipal League, in a letter to General Assembly leaders on Tuesday that asks them to work with local governments and Gov. Ralph Northam to collaborate on using billions of dollars coming to them under the American Rescue Plan Act.
Governor Ralph Northam is expected to call a special session in June to determine how to spend the state’s $3.8 billion share. The problem is that the commonwealth, its localities and school districts have gotten minimal guidance on precisely how this windfall will be allocated. Here’s what we do know, according to Martz:
Local government officials expect close to $3 billion under the law, most of it coming directly to Virginia’s 95 counties and most of its 38 cities, with the state distributing money to small cities and towns that have fewer than 50,000 residents.
But the American Rescue Plan Act also will send $2.2 billion to local school divisions in Virginia, especially to help students overcome the “learning loss” from a year of closed school buildings and virtual education on their personal computers.
It will provide a separate pot of funding for building broadband networks across Virginia to serve residents who haven’t been able to reach or afford internet service that proved essential to remote work and learning during the pandemic. It includes funding for public transit and transportation, and hazard pay for essential workers.
The package has money to help small businesses and hard-hit industries, such as tourism, travel and hospitality…
The package includes 32 separate pots of federal funding, according to Gowdy at the municipal league, which represent cities, towns and eight counties. “It is really daunting.”
Bacon’s bottom line: the federal funds have lots of strings attached. It’s not clear at all that Virginia will have the flexibility to do something transformational. There are about two months between now and the June special session to figure out (1) how the federal funds will be allocated, (2) what limits there are on the spending, (3) what go-big-or-go-home priorities Virginia should set, and (4) how to coordinate the efforts of local governments, school districts, and state agencies to accomplish those objectives.
Good luck with that.
