Missouri in no rush to spend $2.7B of pandemic aid

JEFFERSON CITY, Mo. — Missouri will get nearly $2.7 billion of flexible federal aid under a coronavirus relief law, but it isn't in any rush to spend it.

Under guidelines released Monday by the U.S. Treasury Department, states can start applying immediately for at least half of their share of funding under the law signed earlier this year by President Joe Biden. States could start receiving money this month.

Whereas some states developed spending plans in anticipation of the federal aid, Missouri lawmakers didn't include the new flexible funds in the 2022 budget they passed Friday. Legislative budget leaders said they were waiting on further guidance on how it could be used.

A spokeswoman for Gov. Mike Parson said Monday that the administration will review that guidance and take its time developing a plan to present to lawmakers when they convene next year.

"We want to be thoughtful about how to use this funding to improve the lives of Missouri citizens for the long term," Parson spokeswoman Kelli Jones said.

Because Missouri's unemployment rate is not significantly higher than pre-pandemic levels, the state would be eligible to receive half of its allotment immediately, with the second half coming a year later. States will have until the end of 2024 to make use of it.

Most of Missouri's neighboring states are in a similar situation. But Illinois and 19 other states where unemployment rates rose by more than 2 percentage points from their pre-pandemic levels will be eligible to receive their entire federal share in one payment, as soon as this month.

Federal guidelines prohibit the money from being used to pay off debt, cut taxes or set aside in a reserve fund.

States have wide latitude to use the federal money to make up for revenue losses during the coronavirus pandemic. Among other things, they also can put the money toward public health and mental health care; aid to small businesses, the unemployed or households; water, sewer and high-speed internet infrastructure; or extra pay for a broad range of "essential workers," including teachers, janitors, truck drivers and those in health care, food and public safety jobs.

In addition to the flexible state aid, the federal law also provides about $2.5 billion for Missouri's cities and counties. More than $2 billion of that will go directly to counties and Missouri's 15 largest cities, ranging from $391,000 for Worth County to about $500 million for St. Louis. About $450 million of that will go to the state to be distributed to smaller cities and towns.