The Biden administration on Monday announced the distribution of $350 billion in emergency coronavirus aid to states and cities, bailing out budget coffers and weighting the money to states with higher levels of unemployed workers.
Treasury officials said states and cities will have great discretion on how they spend the money, but they can’t use it to offset any tax cuts.
New York City topped the list with more than $4.2 billion in aid, followed by Chicago with more than $1.8 billion and Los Angeles with $1.2 billion. San Francisco, home to House Speaker Nancy Pelosi, came in at $453.5 million.
Among states, California will receive $27 billion, Texas will get $15.8 billion, and New York is receiving $12.7 billion. The District is receiving about $1.8 billion.
Treasury Secretary Janet Yellen said the states and localities can use the money, part of the American Rescue Plan signed into law in February, to “fill revenue shortfalls” and support communities hardest hit by the pandemic.
“With this funding, communities hit hard by COVID-19 will able to return to a semblance of normalcy; they’ll be able to rehire teachers, firefighters and other essential workers — and to help small businesses reopen safely,” Ms. Yellen said.
She said the funding “will create jobs and help fuel a strong recovery.”
The money is arriving even as the economy has steadily improved, with employers adding more than 1 million jobs in the first four months of this year.
President Biden also is calling on Congress to approve more than $4 trillion in additional spending for infrastructure rebuilding, child-care programs and many other agenda items.
Senior administration officials said the rules governing the spending are deliberately flexible.
“Every state and city are different,” said Deputy Treasury Secretary Adewale “Wally” Adeyemo. “In the coming days and weeks, Treasury’s Office of Recovery Programs will work hand-in-hand with governors, mayors, members of Congress and other local officials to answer any questions and ensure funds making it to communities as soon as possible.”
States and the District of Columbia will receive a total of $195.3 billion. Counties will receive $65.1 billion, cities will receive $45.6 billion, and tribal governments and territories will receive $24.5 billion.