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PA CARES

PROVIDING RELIEF FOR WORKING PEOPLE IN A TIME OF CRISIS

The Pennsylvania CARES Plan offers a set of spending priorities to best use the $3.9 billion in federal CARES ACT funding the commonwealth is set to receive. A major focus of the PA CARES Plan is funding initiatives that help individuals and families, such as housing assistance programs, student debt relief, veterans’ assistance, utility assistance, and food bank support.

Other aspects of the proposal include allocating additional assistance to frontline workers, funding for the health care industry and its workers, small business grants, and much-needed support communities disparately impacted by the COVID-19 pandemic. School districts and local governments would also receive support to help offset pandemic-related expenses.

The Senate Democrats’ response to the COVID-19 pandemic remains focused on helping working people, families and Pennsylvania’s small businesses. Members of the caucus have a number of proposals to address COVID-19 relief and recovery efforts in Pennsylvania.

Highlights

PA CARES - $2.1B for assistance for working people
$650 for health care workers, first responders & front-line workers
$900M for education & child care
$450M for business & Agriculture
$300M for historical disadvantaged communities

Frequently Asked Questions

What are we announcing?
As you know, Pennsylvania will receive approximately $4 billion in federal funding from the Coronavirus Relief Fund and various education-specific funds pursuant to the CARES Act.  As negotiations begin over the allocation of that funding, Senate Democrats are offering a set of priorities for spending those funds.
What are the restrictions on the use of CARES Act Fund?
All federal funds are one-time, nonrecurring funds. Coronavirus Relief Fund dollars must be used for costs incurred due to the COVID-19 pandemic. However, as of now, the federal government prohibits their use to replace state and local tax revenue lost due to the pandemic. Other funds, including the education-related funds we allocate are more flexible.
Can Coronavirus Relief Fund dollars be used to close the looming budget deficit?
The position of the Trump Administration is that Coronavirus Relief Funds cannot be used to replace state and local tax revenues lost due to the COVID-19 pandemic. Consequently, these funds cannot be used to close the commonwealth’s pending budget gap. However, where budgeted costs have been used to respond to the pandemic, those funds may be replaced with CARES Act funds. We will work with the Wolf Administration and other caucuses to identify those potential costs.
How much does your proposal spend? What areas do you focus on?

Our proposal allocates approximately $3.9 billion from the Coronavirus Relief Fund over the following 10 areas:

                        Individuals/Families                                                    $1.1 billion

                        School Districts/Local Government                            $750 million

                        Health Care, First Responder & Frontline Workers    $650 million

                        Small Business                                                             $425 million

                        Historically Disadvantaged Communities                   $300 million

                        Higher Education                                                        $250 million

                        Child Care/Early Education                                         $150 million

                        State Government Infrastructure                               $100 million

                        Agriculture                                                                  $25 million

                        Election Security                                                         $25 million

The proposal also allocates $100 million from education-related funds for K-12 schools for expenses related to shifting to distance learning, including costs of equipment.

How did you determine priorities for funding?
Pennsylvanians are hurting, both physically and financially. We need to get money into people’s pockets, protect our health care system and frontline workers, ensure the viability of our education system, and assist our small businesses. The devastation this virus is having on Pennsylvania is unimaginable. State government must step in and provide relief to do those who need it most. That’s what we are trying to do.
What form will the financial assistance take?
The funds will be allocated as grants to entities that are providing the goods and services we need. Some individuals will receive an emergency stimulus check for costs related to things like housing and student loan assistance. Funds will not need to be repaid.
Have other federal funds been allocated in the areas you have prioritized?
In some cases, yes. For example, the commonwealth has received federal funds for food banks and election security. In areas we believe have a greater need, our proposal would supplement those other federal funds. If the areas we’ve identified end up with sufficient federal funds to complete the task, we may re-consider our priorities and re-direct funds to areas that have additional need.
What is included under each of your 10 categories?

Individuals/Families: Funding for housing assistance (including, homelessness, domestic violence, mortgage assistance, landlords, and legal services), student debt assistance, utility bill assistance, veterans assistance, and food banks

School Districts/Local Government: Funding for school district costs, including special education, and county and municipal government costs related to COVID-19.

Health Care: Funding for our safety net, including high Medicaid hospitals, Long-term Care facilities, and Community Health Centers.  Funding is also provided for comprehensive testing, tracing and tracking of COVID-19 and for our frontline workers, including hazard pay, post-traumatic stress treatment.  First responders also receive funding. 

Small Business: Grants to small business, nonprofits and specific sectors of the small business economy that have been hit particularly hard by the COVID-19 pandemic. 

Historically Disadvantaged Communities: Black and brown communities are being ravaged by COVID-19.  Education, testing and tracing are need in these communities.  In addition, businesses in these communities have been largely unsuccessful in securing federal small business funds.  Funding to address nutrition and access to fresh foods and vegetables will be provided along with emergency funding for the commonwealth’s two (2) Historically Black Colleges and Universities

Child Care/Early Education:  Our child-care and Pre-K operators are struggling to maintain operations.  These stresses will only increase as the economy starts to gradually re-open and parents go back to work.

State Government Infrastructure:  Clearly there have been some issues with agency responses to COVID-19.  We need to upgrade our infrastructure to address COVID-19 and future events that may strain our systems.

Agriculture:  Grants to ensure that our food supply chain can continue to function.

Election Security:  Funding to ensure that the June 2 primary election and the November general election are conducted in a safe and secure manner.

Have you discussed these priorities with the Wolf Administration or the other caucuses?
We’ve had preliminary conversations at the senior staff level about allocating these funds. We will continue those conversations as we work toward a final deal and a FY 20-21 budget.
Yea, what about the FY 20-21 budget?

Good question. Appropriations Committee staffs and the Budget Office have had preliminary discussions. No decisions have been made or timelines for action set. Certainly, a lot will depend on revenue collections. As mentioned, The Trump Administration for the most part has prohibited Coronavirus Relief Funds from being used to replace state and local tax revenues.

Even if Coronavirus Relief Funds could be used to fill our budget hole, or if another round of federal stimulus funding for state and local governments comes from Washington D.C., these are one-time funds. The IFO has projected that the permanent revenue loss in tax revenue for the commonwealth to be approximately $2.7 billion for FY 20-21 and 21-22. We need to be careful of using one-time revenues to plug recurring revenue holes. We also should not repeat the mistakes of the past by relying on massive budget cuts to fix our problems. That was the route taken coming out of the Great Recession in 2011 and the impacts were devastating on the commonwealth and its residents.