ST. PAUL — Gov. Tim Walz and chief executives of other states warned members of the U.S. House Thursday, Sept. 10, that their constituencies will likely endure further economic hardships without the approval of new federal pandemic relief funds.
Additional funding would be used, among other things, to support Minnesota's efforts to test for COVID-19 and to acquire personal protective gear, Walz said. Industries affected by the pandemic and ensuing recession would also benefit, he said, namely hospitality and child care.
The governor said that while the initial coronavirus relief package helped bolster Minnesota's businesses and public health systems, more state-specific funding is needed to deal with the continuing health and financial crisis.
"That's why we're here, asking humbly, that you continue this kind of assistance that has made a difference not in just the safety and the health of my constituents and fellow Minnesotans, but it's helped businesses get back on their feet," Walz said during a video hearing of the U.S. House Financial Services Committee. "As you negotiate, please keep states in mind."
Even after the earlier entreaties Walz and other Minnesota officials made during recent public appearances, though, Congress remains divided on the prospect of additional state funding. A $3 trillion bill passed in the Democrat-controlled U.S. House would provide more relief to states but is unlikely to be taken up in the Senate, where the Republican majority seeks to spend less and avoid adding to the national debt.
A more targeted and Republican-sponsored bill for $300 billion in new aid failed Thursday to pass out of the Senate as well. It did not include additional funding for states, according to a Reuters news report.
Some in Congress say they are reluctant to approve more funding for states when some have yet to spend all of the money given to them in the initial relief package.
"Efforts by the majority to use these individuals today as pawns to justify billions in new spending for state governments is uncalled for, especially as states like mine have yet to use hundreds of millions in relief money given to them," Rep. Tom Emmer, R-Minn., said during Thursday's hearing.
Minnesota received nearly $2.2 billion in federal coronavirus relief funds through the initial aid package, money it used to create a range of new assistance programs, distributed to local governments and schools and spent on testing efforts for COVID-19, the illness caused by the novel coronavirus. Approximately $165 million remains, according to a recent Minnesota Office of Management and Budget report.
Governors and lawmakers expressed support, however, for increasing the flexibility with which states can spend new and existing relief funds. Walz cited broadband connection improvements and education as two other areas Minnesota may look to fund further.
"Some open-endedness would really help us," he said.
Even as the broader economy shows some signs of recovery, governors said Thursday that recovery may yet be thwarted by a pandemic that is unlikely to end soon. Any additional revenue shortfalls would affect a state's ability to fund public services as a result, they said, and could translate to service cuts at the local level.
Minnesota itself faces a $2.3 billion budget for fiscal year 2021 because of the pandemic and a deficit of $4.7 billion in the coming biennium.