NY areas have spent most of federal CARES Act money, report says

WASHINGTON — Public officials in the areas of New York hit hardest by the pandemic have spent all or nearly all of the money they received from the CARES Act fund for state and local governments, according to a recent federal survey of recipients. 

New York City — the U.S. epicenter of the pandemic until about a week ago — reported it had spent 99.6% of the $1.45 billion it received. Nassau County said it spent all of its $103 million in funding. And Suffolk County said it spent nearly three-quarters of its $257 million. 

Those three were among just 15 states, cities or counties that had spent more than half of their allotment among the 200 recipients of the $150 billion fund for state and local governments provided by the $2.2 trillion CARES Act signed into law on March 27. 

That’s according to an interim report issued last week by the U.S. Treasury Department’s inspector general based on actual spending as of June 30 of funds distributed by the department in April — a report that has drawn criticism for being incomplete and political. 

The report appeared as Republicans and Democrats clashed over the need for more funding for state and local governments. 

Senate Republicans insist that states don’t need additional money because they haven’t spent what they’ve been given. But Democrats argue that state and local officials have budgeted but not spent the money — and need much more to cover costs of reopening schools and businesses and to make up for steep drops in revenue.

The National Governors Association, chaired by Maryland Gov. Larry Hogan and New York Gov. Andrew Cuomo, said the report does not include spending that has been budgeted but not spent. It said states and territories have allocated 74% of the funds on average. 

The report appeared as the White House refused to add more money for state and local governments in negotiations on a new relief bill with Democrats, who want $500 billion more for states and $415 billion for localities for pandemic costs and revenue shortfalls. 

Senate Majority Leader Mitch McConnell (R-Ky.) said Thursday that instead of giving states new aid Congress should allow use of the state and local $150 billion fund that “has not been dispensed yet” for just about anything, including revenue shortfalls. 

Senate Minority Leader Chuck Schumer (D-N.Y.) has rejected that approach, and the Long Island delegation to the House supports more state and local funds. “I'm really concerned about the impact on the counties, which have lost hundreds of millions of dollars in sales tax revenues,” said Rep. Thomas Suozzi (D-Glen Cove). 

McConnell’s proposal would not help Nassau or Suffolk counties much. 

Nassau County has spent 100% of its $102.9 million funding, and then some, according to Michael Fricchione, spokesman for County Executive Laura Curran. 

The county spent $95 million on payroll for health and safety employees, $12.9 million on diverted personnel or services, $898,800 to improve telework systems and $1.2 million on public health — or about $110 million. 

“If we don't get this help from the federal government, we can see a real shredding of government services,” Curran said last week. “And God forbid we get a second wave. What happens then when we can't finance those kinds of services and that kind of help that’s so desperately needed.” 

Suffolk County had spent $188.4 million — 73% — of its $257.7 million allotment by June 30, the report said.

Derek Poppe, spokesman for County Executive Steve Bellone, said nearly $172 million of that amount went to payroll for safety and health employees or other diverted personnel or service costs. Other expenditures included funds to improve telework for county employees. 

“We're doing everything we can on a 10 level — common sense things that try to minimize the pain,” Bellone said during his visit to Washington last week.

“But without that federal disaster assistance to help us cover the cost of that response,” he added, “we’re just looking at a gutting of local government and placing the burden on local taxpayers.” 

The state government spent $2.2 billion, or 42%, of the $5.1 billion it received as of June 30, the report said and the state Division of Budget confirmed.

Yet three upstate counties and the Town of Hempstead have spent little of their funds.

Erie County reported spending just 16% of its $160.3 million. Monroe County, which was awarded $129.4 million, and Westchester County, which was given $168.8 million, both said they had spent about 28% of their funds. 

And the Town of Hempstead, which won a $133 million allotment based on its large population, told the inspector general it has used 5%, about $6.8 million. 

Town Supervisor Donald X. Clavin said the town board had authorized $13.6 million in grants, but that it releases the money to food banks, hospitals and other entities only when they present a receipt or other documentation. 

The town has spent about $754,500 for building maintenance and other costs, town records show.