April 29, 2020 - Washington – Senator Dianne Feinstein (D-Calif.) joined a group led by Senator Jack Reed (D-R.I) to send a letter to Secretary Steven Mnuchin the administration to loosen restrictions on how governors can distribute coronavirus relief funds to their states. 

The senators note that the new limits the Trump administration is seeking to impose on states is counterproductive and creates needless obstacles. “In the midst of an economic collapse, the intent of the entire CARES Act is to provide flexible help to a wide range of Americans.  To prevent the flexible use of these relief funds is a choice that is neither required nor intended by law,” the senators wrote. 

The senators also write “that the Treasury Department should publicly confirm that states, Tribes and localities may use these funds to maintain their essential services as the CARES Act clearly permits.” 

In addition to Feinstein and Reed, the letter was signed by Senators Baldwin (D-Wis.), Bennet (D-Colo.), Blumenthal (D-Conn.), Booker (D-N.J.), Brown (D-Ohio), Cardin (D-Md.), Carper (D-Del.), Casey (D-Pa.), Coons (D-Del.), Cortez Masto (D-Nev.), Duckworth (D-Ill.), Durbin (D-Ill.), Gillibrand (D-N.Y.), Harris (D-Calif.), Hassan (D-N.H.), Heinrich (D-N.M.), Hirono (D-Hawaii), Jones (D-Ala.), Kaine (D-Va.), King (I-Maine), Klobuchar (D-Minn.), Leahy (D-Vt.), Manchin (D-W.Va.), Markey (D-Mass.), Menendez (D-N.J.), Merkley (D-Ore.), Murphy (D-Conn.), Murray (D-Wash.), Peters (D-Mich.), Rosen (D-Nev.), Sanders (I-Vt.), Schatz (D-Hawaii), Schumer (D-N.Y.), Shaheen (D-N.H.), Sinema (D-Ariz.), Smith (D-Minn.), Stabenow (D-Mich.), Tester (D-Mont.), Udall (D-N.M.), Van Hollen (D-Md.), Warner (D-Va.), Warren (D-Mass.), Whitehouse (D-R.I.) and Wyden (D-Ore.). 

The letter is available here and below.

April 26, 2020

The Honorable Steven T. Mnuchin
Secretary
Department of the Treasury
1500 Pennsylvania Avenue, N.W.
Washington, D.C. 20220 

Dear Secretary Mnuchin:

We write regarding the Treasury Department’s Coronavirus Relief Fund Guidance to urge you to promptly revise your interpretation so states, Tribal, and local governments can use these funds to prevent further economic damage.

While the term “lost revenue” does not appear specifically in Title V of the Coronavirus Aid, Relief and Economic Security (CARES) Act, a plain text reading of the law leads to the logical conclusion that lost or delayed revenues are a direct cost created by the coronavirus that were never accounted for in any budget.  Therefore, we believe it is fully within your authority and the intent of the CARES Act that these funds may be used to replace lost or delayed tax revenues and maintain public services.  In the midst of an economic collapse, the intent of the entire CARES Act is to provide flexible help to a wide range of Americans.  To prevent the flexible use of these relief funds is a choice that is neither required nor intended by law. 

We are not alone in this view.  Governors and Senators from both sides of the aisle have set aside ideology and urged you to follow the law as written instead of creating more bureaucratic red tape in the middle of a public health emergency and ensuing economic crisis. Of all the regulations that this Administration seeks to cut, it should start with this one.

We all have a common interest in preserving as much of our economy as possible so that we are well positioned for a robust recovery.  A critical component of our economy is our state, Tribal, and local governments as they not only serve as customers for our local businesses, but also provide the essential services, such as effective law enforcement, public infrastructure, a strong education system, and other necessary conditions that provide the business certainty that make our country attractive to businesses and investors throughout the world.  We should preserve and maintain this critical comparative advantage.  

To avoid distracting states, Tribes, and localities from meeting the crisis at hand, the Treasury Department should publicly confirm that states, Tribes and localities may use these funds to maintain their essential services as the CARES Act clearly permits.  

We thank you for your consideration and urge you to act promptly. 

Sincerely, 
Source: Senator Dianne Feinstein