CSAC Bulletin Article

House Budget Reconciliation Legislation Includes Direct Federal Fiscal Aid for Counties

February 11, 2021

House Democratic committee leaders took the next steps in the fiscal year 2021 budget reconciliation process this week as they began to unveil legislative text that reflects key components of President Biden’s $1.9 trillion COVID-19 relief proposal. Pursuant to the recently adopted FY21 budget resolution (S Con Res 5), 12 House committees are charged with drafting and approving provisions of the president’s American Rescue Plan.

In a victory for California’s counties, the House Oversight and Reform (O&R) Committee’s reconciliation package includes a new COVID-19 local recovery fund that would provide federal financial support to counties of every size. CSAC has strongly advocated, including in meetings with the Biden transition team and Members of Congress, that direct and flexible fiscal relief for all counties be included in the next COVID-19 relief package and is pleased with these local government fiscal aid provisions. Thank you to all the counties who have also been urging the inclusion of this funding.

Under the bill, $130.2 billion in funding would be available to counties and cities, with $65.1 billion allocated to counties based on population. This chart shows an estimate of how much each California county would receive under the House O&R Committee bill. It should be noted that these are projections from the Congressional Research Service and subject to change.

The U.S. Department of the Treasury would be required to award recovery funds directly to states and localities within 60 days of the bill’s enactment. Funds would be available to jurisdictions until expended and could be used to respond to or mitigate the public health emergency; cover costs incurred as a result of the pandemic; replace revenue that was lost, delayed, or decreased due to the emergency; and, address the negative economic impacts of COVID-19. View the NACo Analysis for a full description of the Local Coronavirus Fiscal Recovery Fund.

There are numerous other key provisions of the American Rescue Plan that are positive for counties and have been included by various House committees in their respective budget reconciliation measures. See the Update from Washington D.C. for a full description of these provisions.

The relevant House panels are on pace to approve all portions of the stimulus plan by the end of the week, setting the stage for a vote by the full chamber as early as Friday, February 19. The proposed Local Coronavirus Fiscal Recovery Fund is positive and CSAC and counties will need to continue to advocate for this Fund to remain in the reconciliation legislation as it moves through Congress over the coming weeks.

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