Capito, other senators introduce bill to allow CARES Act funding for revenue shortfalls

WASHINGTON, D.C. (WCHS/WVAH) — U.S. Sen. Shelley Moore Capito, R-W.Va., is among a group of senators who introduced legislation that would allow federal relief funds under the CARES Act to be used by state and local governments to replace revenue shortfalls during the pandemic.

The issue is a looming one for the Mountain State. Gov. Jim Justice has said has been hopeful that the state could use a substantial part of the $1.25 billion the state has received through the CARES Act to help backfill a huge budget hole, which has been estimated at more than $205 million.

Meanwhile, top Democrats are promising that small- to medium-sized cities and counties and small towns that were left out of four prior coronavirus bills will receive hundreds of billions of dollars in the next federal assistance bill, The Associated Press reported.

Under the bill that Capito and other senators introduced, the legislation giving state and local governments leeway to use the money to replace revenue shortfalls would apply retroactively to the enactment of the CARES Act, according to a news release from Capito’s office.

The news release said Capito has been in touch regularly with Justice and other community leaders about helping states and localities respond to COVID-19. This legislation is a direct response to the feedback she has received.

“Throughout this pandemic, I’ve been in regular contact with Governor Justice, county commissioners, mayors, and other state and local officials about the challenges they are facing in these uncertain times,” Capito said. “One of those challenges is the lost revenue that the state, counties, and cities are experiencing because of this emergency, which has caused a real strain on their budgets.”

Capito said the bipartisan bill is “a smart, commonsense solution that fixes this problem by providing state and local governments with the flexibility to use money that has already been appropriated through the CARES Act to replace these lost revenues.”

“Doing so, will help state and local governments in West Virginia and across the country get over the hump of lost revenue and allow them to continue providing the essential services,” she said.

Under the CARES Act, states, tribes, and municipalities have access to a total of $150 billion in relief funding. The U.S. Treasury Department issued guidance restricting these resources from being directed toward revenue shortfalls.