House and Senate Democrats propose spending $164.3 million from the rainy day fund and would direct how to spend $2.425 billion of federal funding

By: Emily Makings
12:08 pm
January 25, 2021

Friday afternoon Democrats in the House and Senate announced their early action relief bills (HB 1367 and HB 1368, and companion bills SB 5343 and SB 5344). Together, the bills would appropriate $2.589 billion from state and local funds ($164.3 million from the rainy day fund and $2.425 billion in federal funds). Of that, $403.6 million had previously been allocated by the governor, as described below. The net increase in appropriations would be $2.185 billion.

(As I wrote last week, Rep. Stokesbary’s early action bill would appropriate $4.175 billion from state and local funds. Of that, $403.6 million had previously been allocated. The net increase in appropriations in his bill would be $3.771 billion.)

HB 1367 would fund temporary COVID-19 rate enhancements for long-term care providers using $164.3 million from the budget stabilization account (BSA, or the rainy day fund) and $239.4 million from the enhanced federal match for Medicaid (FMAP, enacted Mar. 18, 2020). This is a policy for which Gov. Inslee had previously allocated $403.6 million from the state’s share of the coronavirus relief fund (CRF, enacted Mar. 27, 2020). Thus, this bill would free up $403.6 million that would be used for other purposes in HB 1368. (Rep. Stokesbary’s early action proposal would also make this funding switch.)

Note that HB 1367 does not include language specifying that the appropriation from the BSA doesn’t alter the requirement to balance over four years. Rep. Stokesbary’s bill does include such language, as did EHB 2965, which appropriated $200 million from the BSA last year. (Under the four-year balanced budget law, budgets don’t have to balance over four years if money is appropriated from the BSA.)

HB 1368 would appropriate money from the general fund–federal (GFF). This includes $70.0 million from the enhanced FMAP, $411.7 million from the CRF (offset by the use of other funds in lieu of the CRF in HB 1367), $1.604 billion from the Coronavirus Response and Relief Supplemental Appropriations Act (CRRSA, enacted Dec. 27, 2020), and $100.0 million in unspecified GFF dollars. The table shows how the funds would be allocated.

Unlike Rep. Stokesbary’s bill, HB 1368 does not link the distribution of elementary and secondary relief funds to reopening schools. However, HB 1368 would not allocate the full amount of federal funds for this purpose. The bill would require districts to submit plans for reopening or expanding in-person instruction in SY 2020–21.

HB 1367 and HB 1368 are scheduled for hearings this week. According to the Seattle Times,

The legislation is designed to get relief money out into the communities by the end of next month, said Sen. Christine Rolfes, D-Bainbridge Island.

“We hope it will hit the governor’s desk within three weeks,” said Rolfes, chief Democratic budget writer in the Senate. “The money will be out in agencies and communities and public schools in February, is my hope.”

Categories: Budget.
Tags: 2019-21 , CARES Act , COVID-19 , other federal action on COVID-19 , state action on COVID-19