High-income, high-tax states would benefit most from reinstatement of the SALT tax deduction. (Photo by Giorgio Trovato via Unsplash)
Days after Gov. Kim Reynolds told Fox News that Iowa had returned $95 million of federal funds, Democratic lawmakers are calling for more oversight into how COVID-19 stimulus money is handled.
Democrats Sen. Claire Celsi, West Des Moines, and Rep. Ruth Ann Gaines, Des Moines, called for the state’s Government Oversight Committees to meet about the allocation of COVID-19 funds. In an interview with the Iowa Capital Dispatch, Celsi requested more transparency and more discussion between political leaders.
“We have a lot more money coming,” Celsi said. “I want to make sure that we all sit down around the table, Republicans and Democrats and the public, to know where the money’s going.”
Celsi said she did not know the state had returned some federal funds until Thursday, when Reynolds said on a Fox News town forum that she had given back $95 million of federal COVID-19 aid. In an April 23 letter obtained by the Des Moines Register, the Iowa Department of Public Health declined the funds, though Director Kelly Garcia said the department would reconsider if the money could be used for something other than testing.
“They sent an additional $95 million to the state of Iowa to get our kids back in the classroom by doing surveillance testing,” Reynolds said Thursday. “And I said, we’ve been in the classroom since August. Here’s your $95 million back.”
Rep. Holly Brink, chair of the House Government Oversight Committee, said she did not anticipate holding a hearing about the returned funding. A meeting on the decision would be a “politically-motivated waste of time,” she wrote.
“Iowa Republicans took action to safely return kids to the classroom months ago so the Governor returned unnecessary federal money,” Brink, R-Oskaloosa, wrote. “Iowa taxpayers don’t want to see their hard earned money wasted, the Governor’s decision appears to be in line with the values of everyday Iowans.”
Brink said the committee has not met to discuss whether additional oversight measures are necessary for the next round of COVID-19 funding. Congress in March passed a $1.9 trillion stimulus package, of which Iowa will receive about $4.45 billion, according to a nonpartisan analysis from the Legislative Services Agency.
Legislative leaders have declined to include the one-time funds in budget negotiations. The stimulus package also forbids states from using the funds to reduce taxes, raising questions about whether Republican tax cuts can go into effect.
“Whatever the decisions or expectations there are with the federal money, we want to be mindful. We don’t want to be supplanting parts of the budget with one-time funds for ongoing expenses,” House Speaker Pat Grassley, R-New Hartford, told reporters April 29. He noted lawmakers are still waiting for federal guidance on how some of the funds could be used.
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