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State should let localities spend COVID funds

The Legislature opened and closed its special session to balance the budget Monday, but took no action on releasing more of the federal Coronavirus Relief Fund money the state received on behalf of local governments. Legislative leaders should move quickly to send the rest of that money to local jurisdictions who can put it to the best use for their communities.

Congress appropriated $1.389 billion in CRF dollars for Oregon in April. Under the guidelines from the Treasury Department, states were to distribute 45% of that, or $624.8 million, directly to local governments.

In May, the Legislature’s Joint Emergency Board committed to distributing $400 million of that money, saying that the state would spend the remaining $200 million itself, on behalf of local governments.

Last week, the Emergency Board was poised to approve a plan to send $105 million to the state Department of Administrative Services to buy personal protective equipment such as masks and gloves to distribute to local governments, and $94.2 million to the Oregon Health Authority — $20.7 million to purchase testing supplies and equipment and $73.5 million to be sent to local public health authorities and community groups for contact tracing, education and other services.

Organizations including the League of Oregon Cities and Association of Oregon Counties submitted written testimony to the board, arguing that local officials were in the best position to know the needs in their own communities, and the federal money should be released directly to them, with no strings attached. In fact, the U.S. Treasury guidelines for the relief funds stipulated that state-imposed restrictions on the 45% share for local governments “are not permissible.” Federal guidelines already stipulate that the money cannot be spent to replace budget shortfalls.

Some lawmakers have called the state’s attitude toward local governments “paternalistic.”

Two Democrats on the Emergency Board joined Republicans and voted down the $200 million allocation.

Besides concerns about the state exerting too much control, city and county officials say they don’t know enough details about how the state is spending the money it has reserved to itself.

It’s one thing for the state to declare that it can get better deals on purchases, but buying more PPE supplies might not be the most pressing need in every community. Local officials are in the best position to determine that.

The state should release the $200 million directly to localities.