Delaware's allocation of federal CARES Act funding totaled $1.25 billion--with all of that money having to be spent by the end of the calendar year on eligible coronavirus-related items, things like testing, contact tracing, and more.
Of that, the state is getting $927 million. New Castle County is getting the rest.
But when he learned that New Castle County was receiving a $323 million share, chair of the Delaware Economic and Financial Advisory Committee Mike Houghton balked.
"How the hell's New Castle County going to spend half-a-billion-dollars, and can't you take some of that money back?"
The short answer? No.
Since New Castle County has a population over 500,000, it's independently eligible for CARES Act funding. County Executive Matt Meyer has already noted the first allocation of CARES Act funds is $5 million to be split among New Castle County municipalities for non-budgeted COVID-19 expenses.
New Castle County Executive Matt Meyer is laying the groundwork for the disbursement of over…
"Funding will be available proportionate to population," said Meyer last month. "The primary reason we're getting out and announcing this today is we want municipal leaders to know if they see emergencies in their municipality, in their city or town, and there are emergency expenditures they need to make, resources are there to reimburse them."
New Castle County volunteer fire companies will share $1 million in COVID-19 expense reimbursements. He's also proposed $10,000 in Heroes pay, or a form of hazard pay to first responders, working on the front lines of the pandemic.
Jackson said the state was working with the county on a partnership to share certain expenditures.
"We are working with them on, hopefully, what will be a partnership in terms of sharing some of the costs with the programs that we've put in place that are directly benefiting New Castle County. So when we discuss using approximately half, or up to half, of our allocation for the state portion of the unemployment insurance trust fund, perhaps the county would help us pay a portion of those costs, given the benefits that it would have for businesses," said Jackson.
"Much more tactfully crafted than my question, Michael, your response was more tactful than my question. You hit on precisely what I hoped could be part of the discussion," admitted Houghton.
Meyer confirmed a partnership was in the works.
"We are committed to working with the state to ensure our economy and health system remains strong as we address the pandemic," said Meyer. "We continue to work collectively to help those most impacted and hurt by this unprecedented event."
Federal CARES Act funding cannot be spent on revenue loss mitigation. Any expenses declared "ineligible" by the U.S. Department of Treasury, must be repaid, after the fact.
"So we are going through a very, I would say, rigorous process with our state Department of Justice, helping us interpret the guidelines from the United States Treasury. There are a number of programs that have been put in place in response to he pandemic that help our small businesses, that help child care industries, that help families who've been impacted with rent and utility assistance, contact tracing, the testing program that is in place, and then the unemployment insurance trust fund."
The unemployment insurance trust fund is predicted to run out of money by late June as it sees record claims, Darryl Scott, Director of Delaware Division of Unemployment Insurance said, at Thursday's meeting.
"You can look at the unemployment insurance claims, and just the state's share, and we're expecting if the current rate of spend on that continues through the end of the calendar year, that could eat up as much as half of the funding," said Jackson. "We should be able to spend it all on the appropriate expenditures."
Secretary of Finance Rick Geisenberger noted he'd like to see most of the CARES Act funding go to the unemployment issue.
"Because we obviously don't want to have a huge loan that results in a large tax increase on all Delaware employers at the end of this, which is what happened after the last Great Recession--we had to raise taxes at the exact wrong time," said Geisenberger.