How has $350 billion in COVID relief funds been used?

Last year’s partisan, nearly $2 trillion American Rescue Plan Act gave $350 billion to governments of states, localities, territories and Tribes, but lacked any oversight mechanism to ensure the funds were properly used. As Ranking Member of the Senate Finance Committee, I am asking the Government Accountability (GAO) to help ensure proper oversight and accountability to Congress and the American people.

Ensuring taxpayer funding is properly used and accounted for is an important responsibility that cannot be sidestepped. Unfortunately, ARPA, unlike the bipartisan Coronavirus Aid, Relief, and Economic Security (CARES) Act, did not contain a meaningful built-in nonpartisan oversight mechanism that allows for necessary congressional oversight, resulting in a lack of transparency on uses of the funds provided to various governments.

Despite several discussions with officials at the U.S. Department of the Treasury, and materials provided from the Department, there remains insufficient information on details, and reporting that is publicly available to date indicates erroneous reporting that Treasury appears to take with casual indifference. For instance, in a document detailing obligations and expenditures, there were several instances where expenditures exceeded obligations, a seeming accounting impossibility. Treasury officials have indicated no desire to request corrections of known reporting errors, and Treasury’s position appears to be to treat errors as bygones to ignore.  Such a practice does not adhere to principles of sound federal financial management.

Because of the lack of information on the uses of and accounting for these federal funds, we requested the GAO help ensure proper oversight of, and financial controls over, at least $350 billion of ARPA funding for Coronavirus State and Local Fiscal Recovery Funds and necessary accountability to the American people. 

We asked the GAO for a prompt assessment of the Treasury Department’s administration of state and local funds as it assists in investigating a series of oversight questions, including:

• Whether Treasury is ensuring efficient and transparent use of taxpayer resources;

• How Treasury has tracked whether states have satisfied an arbitrary requirement that funds not constitute a “tax cut,” and whether the requirement served any useful purpose;

• Information on reporting errors, and whether the practice of ignoring such errors adheres to principles of sound federal financial management;

• What controls have been established to ensure reported expenditures by states and localities abide by the restrictions on uses put in place in ARPA;

• How has Treasury enforced a legal restriction against a government using state and local funds for deposit into pension funds; and

• How much of the $350 billion allocated by Treasury to state and local governments has been recouped to date, and how can Congress and the American people monitor any such recoupments? 

This recent inquiry is part of my longtime concern with oversight of these taxpayer dollars. In March of 2021, as ARPA became law, I urged U.S. Department of Treasury Secretary Janet Yellen to follow a strong oversight framework, similar to that employed under the CARES Act, to ensure proper oversight and taxpayer protection. I followed this with another March 2021 letter to Secretary Yellen requesting details and clarity on how the Department would implement the state and local provisions in ARPA, and I continue to press the Administration to share needed details. Taxpayers deserve oversight, accountability and transparency of this massive spending, and I will not let up in working to ensure these questions are answered.

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Mike Crapo represents Idaho’s First Congressional District in the U.S. Senate. He can be reached at crapo.senate.gov.