Baker Admin. Worried About Holdup as House Dems Vote to Stash Fed Aid

The action by the House highlights a disagreement about how quickly federal funds should be spent to assist in the state's economic recovery.

Governor Charlie Baker
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The House on Tuesday rejected Gov. Charlie Baker's request to immediately spend $2.8 billion in federal COVID-19 relief money, choosing to follow through with the plan of Democratic leaders to sweep most of the $5.3 billion the state received into a separate fund as they consider how to deploy the money.

The action by the House reflects not only a disagreement between the governor and Legislature over process, but also about how quickly the federal funds should be spent to assist in the state's economic recovery.

Baker last Thursday offered a compromise that would have allowed him to immediately spend more than half of the funding the state received through the American Rescue Plan Act, and give the Legislature more time to deliberate over how to spend the remaining $2.3 billion.

The Republican governor proposed to put $1 billion into housing and home ownership programs, and hundreds of millions of dollars into job training, water and sewer infrastructure and other priorities. The spending was targeted toward helping people and communities hard hit by the coronavirus, including communities of color.

House Speaker Ron Mariano and Senate President Karen Spilka, however, quickly dismissed the governor's plan, and the House on Tuesday formally voted 130-30 along party lines to sweep $4.89 billion into a COVID-19 relief fund, subject to appropriation by the Legislature.

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"While the Administration has proposed working with the Legislature to appropriate all of the funds, the Administration also remains concerned about holding up these funds with a process that would take years while the communities that were hit hardest by the pandemic, including communities of color, wait," Baker spokesman Terry MacCormack said Tuesday in response to the vote.

While Baker did not say whether he would veto the bill should it again reach his desk, it's likely Democrats in the Legislature will have enough votes to override the governor.

"We can all agree a number of those are well conceived and worthy. We don't deny that. We just think it's important all 160 members of this body and 40 in our sister body have a chance to have their voice heard," said Rep. Dan Hunt, the chair of the House Committee on Federal Stimulus and Census Oversight, about the governor's priorities.

Hunt said that over the course of several months after the "July holiday" the House planned to have multiple hearings on different subject matters to gather input on how the money should be spent. Mariano and Spilka said the hearings would be led by the Joint Committee on Ways and Means.

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"The Legislature stands firm in its commitment to employing an open, transparent and thorough public process to best understand how we as a state can make smart investments with these one-time federal dollars to address pressing and long-term needs while promoting a just recovery for all areas of the state," Mariano and Spilka said in a statement after the House vote.

The Democratic leaders said they invited the administration to testify at their hearings.

"We will continue to seek input from the Governor and expect that he will file additional legislation so that his priorities can be part of that process," Mariano and Spilka said.

Unlike Baker who said it was important to put the money to work now to fuel the economic recovery, Hunt said Congress intended "a process to take place over four years."

The Dorchester Democrat noted that other rounds of federal stimulus were pumped directly into the economy and cities and towns will still receive $3.4 billion in separate ARPA relief. Additional buckets of money from ARPA for unemployment, child care, higher education, public transit and other sectors flow to directly from the federal government to recipients without the involvement of the Legislature or governor.

"As we move forward in a recovery phase, it's important to spend time to reflect on this once in a generation funding," Hunt said.

The House and Senate had initially proposed to sweep the more $5.28 billion in ARPA aid received by Massachusetts into a fund that Baker could not touch without their approval, but over the past several weeks $394 million of the relief money has been committed.

Baker has already spent $109 million on local aid for four cities -- Chelsea, Everett, Methuen and Randolph -- shortchanged aid by federal funding formulas and $75 million is needed to subsidize the state's new COVID-19 emergency sick leave law.

The House vote on Tuesday also left Baker with $10 million to cover the cost of a new "VaxMillions" vaccine Lottery, which is offering fully vaccinated residents a chance to win one of five $1 million prizes, or one of five $300,000 scholarships for entrants under 18.

One wrinkle added to the debate Tuesday was an amendment offered by Hunt and Ways and Means Chairman Aaron Michlewitz and unanimously approved in the House that directs Baker to spend $200 million "to protect against emerging public health threats or to support new, heightened, or emergency public health response efforts against the 2019 novel coronavirus and variants thereof."

Public health departments strained by the pandemic have requested up to $250 million in recovery funds to help hire staff, invest in training and upgrade data systems.

"I think that's great example of an item that we'd love to work with them and with the Legislature on to come up with an appropriate investment there going forward," Baker said last week.

Through her joint statement with the speaker, Spilka indicated that she supported and would ask the Senate to approve the $200 million for "urgent public health needs that may require an immediate use of funds."

Since Baker presented his plan to spend more than half of the ARPA on what he thought were priorities the Legislature could support, the response has been mixed.

For instance, some environmental groups cheered the focus on water and sewer infrastructure, parks and climate resiliency projects. Meanwhile, business groups like the National Federation of Independent Businesses lamented that Baker did not recommend using some of the funding to replenish the unemployment trust fund.

The governor has said he currently does not need legislative approval to spend the federal aid, but when asked last week why he didn't just start spending the money now he said he wanted to work with the Legislature.

"I think we're trying to pursue this in what I would describe as a good faith manner," Baker said.

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