As the U.S. House passed a $1.9 trillion federal stimulus plan on Wednesday, the Maryland House temporarily slowed work on the state budget ― to give appropriators time to understand the flood of federal money headed to the state, and to wrest some control over stimulus spending from the governor.
Billions of dollars are expected to come to Maryland through the third federal stimulus package, including more than $3.8 billion that would come directly to state government to help with budget strains. Additional billions ― yet to be calculated ― will also come to the state to bolster local governments, extend unemployment benefits, boost infrastructure projects, and ease financial burdens for Marylanders.
And that money comes on the heels of the state’s most recent financial forecast showing an estimated $299 million increase in unallocated revenue for the upcoming fiscal year, which lawmakers are building a budget for now.
The House Appropriations Committee, which is leading the charge on the passage of Maryland’s 2022 budget, delayed a meeting on final budget decisions ― from Friday to Monday ― to allow for some time to analyze the changing financials, Chairwoman Maggie L. McIntosh (D-Baltimore City) said Wednesday.
But top legislators also want to work with Gov. Lawrence J. Hogan (R) to guide the federal stimulus spending.
“The vision that I see that I am so hopeful for is that we work together with this administration and with the Senate – just as we did with the RELIEF Act – to put our imprint on the incredible help coming from the federal government at this time,” McIntosh said.
Hogan can spend the stimulus money through legislation and the annual budgeting process ― which would allow for legislative input ― or by budget amendments during the legislative interim. Typically, such amendments are presented to the legislature for review and comment, but in some cases during the pandemic, Hogan has used his emergency authority to execute amendments without legislative review, David C. Romans, fiscal and policy coordinator for the Department of Legislative Service’s Office of Policy Analysis, told lawmakers.
McIntosh said she hoped the General Assembly’s presiding officers would be able to meet with Hogan to cooperate on a plan for incorporating stimulus funding into the state budget. A spokesman for Hogan said Wednesday evening that no decisions about how to budget the stimulus funding have been made yet. “We meet with legislative leaders regularly, and I’m sure this will be on the agenda next time around,” Michael Ricci said in an email.
McIntosh has also introduced House Bill 898, which would prohibit the governor from spending stimulus funds through budget amendment, unless that spending aligns with certain public health and policy priorities.
Under the bill, Hogan would still be able to use the budget amendment process for vaccination efforts, transit operating costs, education programs, eviction assistance and unemployment assistance. The prohibition also wouldn’t apply if the Board of Public Works determined a budget amendment was necessary to maintain public health or protect the economic welfare of the state.
“More than anything, I hope that we, the administration and the Senate can move forward together,” McIntosh said Wednesday. “It’s just really important to me that your input is part of the federal government package,” she told her committee members.
McIntosh said some of her priorities for new stimulus funding would include replenishing the state’s rainy day fund, strengthen retirement funds, helping essential workers and paying down on the state’s structural deficit.
Appropriations Committee members expressed hope that the funding might be used to enhance parkland in the state, or to extend safety net programs to families suffering in the pandemic.
Stimulus will be signed
The White House said Wednesday that President Biden will sign the sweeping $1.9 trillion coronavirus stimulus package on Friday.
The massive bill received final passage from the U.S. House on a party-line vote Wednesday afternoon. The measure includes a new round of $1,400 direct checks for many Americans, as well as an extension of expanded unemployment checks to assist people whose jobs vanished in the past year of shutdowns and lockdowns. Thursday will mark the one-year anniversary of the World Health Organization’s declaration that COVID-19 was a global pandemic.
The package sends financial help to state and local governments, restaurants, child care centers, and schools, and provides money to increase COVID-19 testing and vaccines, lower health insurance premiums, and boost broadband access.
The measure also vastly expands the child tax credit, temporarily giving most parents monthly checks instead of once-a-year tax reductions or checks. That provision greatly strengthens the social safety net for poor and middle-class families, and is expected to cut child poverty in half.
“This legislation is about giving the backbone of this nation – the essential workers, the working people who built this country, the people who keep this country going – a fighting chance,” Biden said in a statement immediately after the vote.
As with Saturday’s 50-49 vote in the Senate and the initial vote in the House, no Republicans joined the Democratic majority in support of the bill, which passed on a 220-211 vote. One Democrat, Rep. Jared Golden of Maine, opposed the bill, saying in a statement that he would have preferred a more narrowly tailored measure.
Democrats have lauded the stimulus measure — which is nearly as large as the relief package approved last March, following stay-at-home orders and rising case counts — as providing immediate help to constituents still struggling with the effects of a virus that has caused more than 29 million confirmed infections in the U.S. and more than 525,000 deaths.
“This not only gets us to the other side of the crisis, it really starts healing the wounds that have been caused,” House Majority Leader Steny H. Hoyer (D-Md.), said ahead of the vote.
Republican legislators have unanimously opposed the measure. They have decried it as unnecessary when the economy has shown signals of recovery, arguing that too little spending is focused on the virus’s effects and that portions of the bill won’t be spent for several years.
“I believe all of us continue to support targeted help for those who need it, but that’s not what this bill is,” said Rep. Lloyd Smucker, (R-Pa.), calling it “the largest progressive policy wish list of all time.”
Rep. Jason Smith of Missouri, the ranking Republican on the Budget Committee, blasted the measure for spending less than one in $10 on boosting COVID-19 testing, treatment and vaccinations.
“Only 5% of the K-12 education funding will be spent this year, even as Americans are told this money is needed to reopen their children’s schools,” Smith added, citing a cost projection from the Congressional Budget Office.
White House officials have said they believe the school funding will be spent much faster than the CBO estimates.
Still, Republicans linked much of their criticism to the slow pace of school reopenings across the country. During Tuesday’s floor debate, Republican legislators rose one after another to request that the House instead take up a bill narrowly focused on helping kids return to in-person learning.
Democrats opposed the tactic, accusing GOP lawmakers of delaying a final vote on much-needed aid to Americans, including money that schools can use for addressing learning lost over the past year and buying equipment needed to reopen buildings.
“Republicans won’t help us … Why? Because Donald Trump’s name won’t be on the stimulus checks? Is that how easily they will abandon their constituents?” asked Rep. Steven Horsford (D-Nev.).
While congressional votes on the pandemic stimulus package have been deeply divided, public opinion surveys have shown a sizable majority of Americans support the legislation.
A survey by Pew Research Center found 70% of adults favor the stimulus measure, and 28% oppose it. Democrats and those who lean Democratic overwhelmingly favor it, with 94% in support, and Republicans are divided, with 41% in support and 57% opposed.
No minimum wage increase
The final package largely aligns with the outline that Biden initially proposed. The Senate removed a proposal to boost the minimum wage to $15 an hour, and narrowed both the size of the unemployment benefits and the income limits for receiving the direct checks.
Of the $350 billion in direct aid to state, local governments, territories and tribes, $195 billion would go to states and the District of Columbia, and $130 billion would be divided among cities and counties. Another $10 billion was carved out for capital projects, like improving broadband access.
The bill set limits on how the state and local aid can be used, barring officials from using the dollars to pay down pension costs or to pay for new attempts to cut taxes. And it would ensure that states get at least as much as they received under the last aid package.
The bill’s passage comes days ahead of the mid-March deadline set by Democrats who wanted to pass the funding before the last extension of unemployment benefits is set to run out.
The White House has said Americans are likely to see the direct checks hit their bank accounts by the end of the month. The new monthly checks stemming from the expanded child tax credit are set to begin in July.
While the child tax credit is only expanded for a year under the legislation, Rep. Richard Neal, a Massachusetts Democrat who chairs the Ways and Means Committee, expressed confidence this week that the provision will become permanent.
“What we did is unlikely to go away,” Neal said, describing it as harder to get something out of tax laws than to get something added to those statutes.