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Louisiana to get $2B in federal virus aid, but with strings

8 months 1 week 2 days ago Friday, January 15 2021 Jan 15, 2021 January 15, 2021 4:17 PM January 15, 2021 in News
Source: Associated Press

BATON ROUGE (AP) — Louisiana expects to receive at least $2 billion in coronavirus aid from the latest relief package passed by Congress, but state officials don’t yet know what strings are attached and how much of the cash could help patch budget holes next year.

“It’s a big mystery right now, how those dollars can be spent,” said Commissioner of Administration Jay Dardenne, the governor’s chief budget adviser.

Data collected by the Legislative Fiscal Office, the Board of Regents and others analyzing the congressional legislation estimate Louisiana’s in line for nearly $1.2 billion for K-12 schools, $308 million for rental assistance, $310 million for the health department and $277 million for higher education. Gov. John Bel Edwards also will have $23 million in discretionary dollars for education.

But the money will come with federal regulations for spending, and many of those rules haven’t been released yet. Some of the congressional relief will flow directly to agencies or college campuses. The health care dollars, for example, are earmarked specifically for COVID-19 testing and vaccine distribution uses.

And any decisions made in the waning days of President Donald Trump’s administration could be tweaked by President-elect Joe Biden’s team.

The Edwards administration is trying to piece together which dollars can help it craft the budget for the 2021-22 financial year that begins July 1, to keep programs and services from deep cuts. The upcoming year is expected to have holes because of continued lagging tax collections due to high unemployment and business restrictions amid the coronavirus outbreak.

The state’s income forecasting panel will help put a dollar figure on how deep next year’s budget shortfall Tuesday. Edwards’ budget proposal for next year, using those latest income estimates and possibly incorporating some of the new federal aid, is due to lawmakers by Feb. 26.

Dardenne’s anticipating a sizable portion of the federal money earmarked for colleges and K-12 schools could be used to offset budget cuts. But he’s also hopeful the Biden administration and Congress will agree to more aid for state and local government agencies struggling from the pandemic’s economic impacts.

Meanwhile, education leaders have their own ideas for spending some of the federal assistance, rather than using it simply as a stopgap for next year’s budget.

Final plans for spending much of the money likely will take months. Lawmakers don’t start the legislative session until April and aren’t expected to finish crafting a budget until the session’s final days in June.

The largest slice of new federal aid, nearly $1.2 billion, is earmarked for elementary and secondary schools. The education department said Friday that initial guidance shows the dollars can be used for a long list of expenses, and Superintendent of Education Cade Brumley and his staff were talking to education leaders about their ideas.

“There is a new focus on addressing learning loss for students disproportionately affected by coronavirus and school closures, particularly high-need students,” Brumley spokesman Ted Beasley said in a statement.

The Board of Regents, which oversees public college campuses in Louisiana, said the $277 million in higher education money is expected to flow directly to individual campuses like previous federal coronavirus aid. Estimates of what each school will receive already have been released.

But a portion of the allocation to each campus will have to help students directly and isn’t expected to be available to offset budget cuts. In addition, higher education leaders are seeking $157 million in new spending for their schools, including salary hikes for faculty and staff.

“Our employees deserve a pay raise, and they have most certainly earned it,” Louisiana State University interim President Tom Galligan told the system’s governing board Friday.

Lawmakers plugged most of the budget holes caused by the coronavirus outbreak in the current financial year with about $800 million from the last round of temporary virus aid that Louisiana received from Washington.

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