News: Quick Takes

Federal bill would give North Carolina more flexibility to spend CARES Act money

Three North Carolina members of the U.S. House of Representatives say they’ll back a bill giving states and localities flexibility under the CARES Act to replace lost tax money. The bill was inspired by a letter sent to congressional leaders from the John Locke Foundation and other state-based free-market policy groups.

U.S. Reps. George Holding, R-2nd District, and David Price, D-4th District, plan to support H.R. 6652, the FLEX Act. Rep. Alma Adams, D-12th District, will co-sponsor, the representatives’ spokespersons said. Reps. Richard Hudson, R-8th District, and Ted Budd, R-13th District, are considering the bill. The other seven members of the state’s House delegation failed to reply to a request for comment. (District 11 was vacated in March by former U.S. Rep. Mark Meadows, who now serves as the White House chief of staff.)

The bill comes on the heels of an April 13 letter sent to congressional leaders by Amy Cooke, CEO of the John Locke Foundation, and Jim Vokal, CEO of the Platte Institute in Nebraska. CEOs of 27 other state-based free-market think tanks later added their signatures.

As part of the CARES Act, each state received $1.25 billion, plus more money based on population, along with a portion allotted to local governments. The problem is, the bill’s design “all but compels” states to invent new spending related to COVID-19, the CEOs explained in their letter.

“Unlike the federal government, most states and local governments must balance their budgets,” they wrote. “We ask Congress to allow states the ability to use their Relief assistance in the most prudent and least disruptive way possible.”

Price had signed a letter April 9, along with 44 other Democratic congressmen, urging Speaker of the House Nancy Pelosi and Minority Leader Kevin McCarthy to consider emergency assistance for state and local governments in the next COVID-19 package. They requested at least $150 billion be added to the next relief package, along with the flexibility for states and localities to use that funding to replace their lost tax revenue.

While the April 9 letter asks Congress to spend more money, the FLEX Act would give states budget leeway without increasing federal spending.