Press Releases

Today, Republican Study Committee’s (RSC) Budget and Spending Task Force Chairman Ben Cline (R-VA) and RSC Chairman Kevin Hern (R-OK) sent a letter to U.S. Treasury Secretary Janet Yellen demanding that the Treasury Department roll back an Interim Final Rule (IFR) that would allow state and local governments to hoard tens of billions in unspent COVID funds from the 2021 American Rescue Plan (ARP).

Under current law, state and local governments have until December 31, 2024, to “obligate” COVID funds. Instead of enforcing this statutory deadline, the Treasury Department’s rule allows state and local governments to obligate funds past the statutory deadline by submitting a detailed memo on how they plan to spend the money by April 30, 2024. This blatantly fails to comply with congressional statutes and will further fuel the fire of inflationary, wasteful government spending.

Co-signers of the letter include Representatives Jeff Duncan, Michael Cloud, Randy Weber, August Pfluger, Beth Van Duyne, Ralph Norman, Harriet Hageman, Lance Gooden, Scott Franklin, Doug LaMalfa, Scott Fitzgerald, James Baird, Ronny Jackson, Chuck Edwards, Austin Scott, Josh Brecheen, Rich McCormick, Joe Wilson, Barry Moore, Claudia Tenney, Glenn Grothman, Andy Biggs, Eli Crane, Alex Mooney, Eric Burlison, Pat Fallon, Byron Donalds, Kat Cammack, Mike Collins, Rudy Yakym, Bob Good, Erin Houchin, Keith Self, and Troy Balderson.

The Economic Policy Innovation Center (EPIC) also supports the letter.

“The Coronavirus State and Local Fiscal Recovery Fund (SLFRF), which the Biden Administration has treated like a slush fund, is a quintessential example of government waste, and a critical opportunity for taxpayer savings. Even worse than the initial waste is Treasury’s new Hoarding Rule, which allows states to stash this money for later unspecified uses. We are grateful to Congressmen Cline and Hern and their 34 Congressional colleagues who joined them in championing common sense and highlighting these abuses, including Treasury’s overreach on the definition of an obligation.”— Brittany Madni, Executive Vice President, Economic Policy Innovation Center

The full text of the letter can be found here. Excerpts from the letter below:

Congress designed the SLFRF to “support [the state and local] response to and recovery from the COVID-19 public health emergency,” but much of that funding is being used for projects that have little if anything to do with relieving or recovering from the pandemic.

For example, “more than $185 million has been approved for projects related to golf courses (such as updating irrigation systems or buying golf carts), more than $400 million has gone to improve swimming pools, almost $80 million has gone to sports stadiums, $34 million has gone to building tennis and pickleball courts, $10 million has gone to rodeos, and one town even got $15 million to install showers and a commercial kitchen at a site to host the circus and local flea market. $4 million even went to the Field of Dreams in Iowa where Major League Baseball hosts its annual late-summer game!”¹

The list of inappropriate uses of SLFRF funds goes on and on. What’s more, those inappropriate uses and this unilateral extension of time to obligate funds conveniently coincide with this final year of the Biden Administration’s first term in office, further raising the question of whether these funds are being properly deployed around the country. With approximately 44 percent, or $152 billion SLFRF dollars as yet unobligated, it is absolutely vital that Treasury exercise tremendous care in its management of the program, not engage in wanton, unilateral rulemakings that unlawfully expand the period for obligation of SLFRF funds.

It is abundantly clear that Treasury is attempting, through this immediately effective and final rulemaking, to wall off money from Congress as we seek offsets to new Federal expenditures.

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The IFR’s new April 30, 2024, reporting deadline unlawfully extends the statutory requirement to obligate funds beyond the established deadline of December 31, 2024, by two years. The IFR would enable funds to be obligated post-December 31, 2024, through December 31, 2026. Treasury has not articulated a statutory authority or justification for this change wrought by the IFR. It has not supplied Congress or the public with any reasons or rationale. It has unlawfully contravened the plain language of the statute. Consequently, the IFR should be withdrawn by the Department.

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The Anti-Deficiency Act prohibits Treasury from expending and obligating funds in a manner inconsistent with its direction Congress. For example, the ADA makes clear that Treasury may not “make or authorize an expenditure or obligation exceeding an amount available in an appropriation or fund for the expenditure or obligation,” and it may likewise not “involve either government in a contract or obligation for the payment of money before an appropriation is made unless authorized by law.”²

Here, by changing the definition of “obligation” and adding a new definition for “return of funds” to the SLFRF program, Treasury is potentially putting itself afoul of these and other ADA requirements. Treasury has provided no explanation or justification for how these purely discretionary policy choices comport with the ADA. It must immediately do so or withdraw these regulations.

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“We, along with the Government Accountability Office, must increase oversight of the Executive Branch’s use of emergency COVID-19 funding. A significant amount of activity on this front is underway, but more is required.³ The SLFRF fund is one program that requires additional oversight. As has been explored, it does not appear that President Biden and Treasury are properly managing the SLFRF program, and indeed are now seeking to unlawfully and unilaterally expand it for apparently political purposes. We cannot tolerate that.”

¹ Paul Winfree and Brittany Madni, Econ. Pol. Innov. Ctr., “The Bidenomics Slush Fund: How $350 Billion is Being Misappropriated (Dec. 3, 2023),” https://epicforamerica.org/publications/bidenomics-slush-fund/.

² 31 U.S.C. § 1341(a)(1).

^[1] See generally Government Accountability Office, “Coronavirus Oversight,” https://www.gao.gov/coronavirus.

Full letter here.

Read more coverage on the letter from Semafor here.

Congressman Ben Cline represents the Sixth Congressional District of Virginia. He previously was an attorney in private practice and served both as an assistant prosecutor and Member of the Virginia House of Delegates. Cline and his wife, Elizabeth, live in Botetourt County with their two children.

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