WASHINGTON — The $1.9 trillion COVID relief bill will send billions of dollars to Florida and its residents, but the state’s Republican governor and Legislature will ultimately have a lot of power over funds that were passed into law by Democrats.
The bill, so big its price tag amounts to about 10 percent of the entire U.S. economy, includes a lot of significant policies that will affect millions of Floridians, including an additional $300 per week in unemployment benefits through Sept. 6 and a tax break of up to $10,000 for unemployment benefits. Expanded unemployment benefits in a $900 billion stimulus bill passed in December was set to expire Sunday.
And individuals earning $75,000 a year or less will receive a $1,400 stimulus check, with smaller payments for those earning $75,000 to $80,000 per year. Most parents will also receive a child tax credit of $3,000 per year for each child ages 6 through 17 and $3,600 per year for each child under age 6.
But the largest fight over the bill from Republicans was on $350 billion in state and local aid.
Florida will receive $10.2 billion, cities across the state will receive $1.4 billion, counties will get $4.1 billion and other local governments will get $1.3 billion. A lot of that money, which isn’t allocated for specific purposes, will end up in the hands of GOP elected officials at the state and local levels.
“It would be my hope that most of the money ends up going back to the people, that’s where it belongs,” said Miami Republican Rep. Carlos Gimenez, who served as Miami-Dade County mayor before entering Congress in January. “I have a sneaking suspicion that some cities, some counties that find themselves in a difficult financial situation are going to use this money to balance their budgets and that’s why I’m against this bill.”
The bill, which previously passed the U.S. Senate on a 50-49 vote, passed the U.S. House of Representatives Wednesday on a 220-211 vote, with all Democrats except one voting in favor and all Republicans voting against. President Joe Biden is expected to sign the bill into law on Friday.
Making Florida’s decisions
Florida Gov. Ron DeSantis essentially had sole discretion over how to spend the nearly $6 billion in CARES Act money Florida got last March.
But now, the governor and legislative leaders seem to agree that the federal funding coming to the state next should be appropriated by the Legislature, which is also controlled by Republicans.
“We’re in session, so we’ll be allocating the money during the budget process,” House Speaker Chris Sprowls, R-Palm Harbor, said at a news conference last week.
DeSantis also cautioned it could take weeks for the state to figure out how precisely it can spend the money. He even floated the possibility of a special legislative session to address the federal funding.
Even if it takes a while to figure out, DeSantis has plans for the money. In a move that may win bipartisan praise, DeSantis said he wants to beef up the state’s flood infrastructure.
“I feel confident that as is, we’ll be able to put a lot of that money towards our Resilient Florida program,” DeSantis said. “It’s infrastructure we would have needed to have done anyways.”
The bill itself is popular with voters — including Republicans — even though elected Republicans in Washington, including Florida Sens. Marco Rubio and Rick Scott, are uniformly against it. Stimulus checks, small business relief and money for vaccines are among the popular proposals in the bill.
“With his leadership and willingness to use the Defense Production Act for vaccines, Joe Biden has given us two more months of freedom, and a summer of lives saved,” said Democratic Rep. Charlie Crist, a former governor who is considering a 2022 bid against DeSantis. “This is a plan that meets the crisis we’re in.”
Shortly after the House voted, Scott sent a letter to governors and mayors asking them to “return any federal funding in excess of your reimbursable COVID-19 related expenses.”
“This commitment will serve the best interests of hard working American taxpayers and will send a clear message to Washington: politicians in Congress should quit recklessly spending other people’s money,” Scott wrote.
But DeSantis and state Senate President Wilton Simpson have also proposed using part of the state-based aid in Florida to provide $2 billion in tax cuts for businesses to help replenish the state’s unemployment fund, another example of Republicans potentially using money given to them by Democrats in Washington.
“If we were to take a portion of that money — $1 billion to $2 billion — and put it into the unemployment compensation fund, then you’d be looking at a very large tax cut for businesses that are trying to reopen in this state,” Simpson said at a news conference last week.
Expanding access to healthcare
Congressional Democrats are opposed to the plan.
“We’ve already provided ample help to small businesses,” said Central Florida Democratic Rep. Darren Soto. “The most obvious use of these funds is expanding Medicaid. We’ve made it easy for Florida to do it and finally get this done.”
If Florida were to expand Medicaid, under the latest round of relief, the feds would agree to pick up hundreds of millions of dollars of Florida’s share of that spending. Medicaid, which insures the poor and sick, is paid for by a combination of state and federal funding. Florida’s share of the funding amounts to about a third of the state’s budget.
But so far, Republicans in Tallahassee have shown no appetite to expand Medicaid, arguing the program is too costly. The new incentives in the bill are unlikely to sway them.
And the legislation, dubbed the American Rescue Plan, also includes the largest expansion of Obamacare since it became law in 2010. The bill includes a provision that increases federal spending on subsidies for Americans purchasing coverage on the exchanges by nearly 30 percent.
Florida routinely leads the country in people who sign up on the federal Affordable Care Act insurance exchange. In 2020, a record 870,000 Floridians bought their insurance this way, and Miami-Dade County has some of the highest Obamacare sign-up rates in the entire country. Most Obamacare recipients in Florida are poised to see a good chunk of savings on their premiums for the next two years, with $34.2 billion in new spending on more generous Affordable Care Act tax credit subsidies.
Before, federal insurance subsidies were limited to people who make 400 percent of the poverty line — about $106,000 per year for a family of four — and lower. Now, everyone who buys insurance on the exchange is eligible for a tax credit. According to the Congressional Budget Office, a 45-year-old making $58,000 per year would spend save about $100 per month on premiums.
Louisa McQueeney, the program director of Florida Voices for Health, said the additional federal spending would be a welcome sight to Florida families.
“That provision was needed from the get-go, actually,” said McQueeney, whose organization advocates for affordable healthcare plans for Floridians.
And combating COVID
The bill also includes billions for coronavirus testing and contact tracing, and funds to re-open schools.
But Gimenez said the $1.9 trillion in spending will become less popular with Americans as the country begins to return to normal in the coming months. He argued that “only 10 percent” of the bill directly targets COVID relief, and that most of the money in the bill won’t be spent until 2022 or later.
Florida Republicans have also argued the bill is unfair to Florida because state and local aid funding formula is tied to unemployment. DeSantis said the state’s lower unemployment rate during the pandemic means the state will be “penalized” compared to others.
“You’re getting a quarter, but you’re going to have to pay back a dollar, that’s not such a great deal,” Gimenez said. “As this money starts to get spent and people find out what it’s being spent on this thing is going downhill. The sweetness of that $1,400 check is going to be overcome by the bitterness of the pork that’s attached to this bill.”