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Wisconsin to receive $700M less in federal COVID-19 stimulus funds than projected

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Wisconsin will receive $700 million less in federal COVID-19 dollars than was originally projected for the most recent stimulus package — which Democratic leaders in the state said could hinder ongoing pandemic recovery efforts.

In a letter sent Tuesday, Gov. Tony Evers and U.S. Sen. Tammy Baldwin, D-Madison, asked U.S. Treasury Secretary Janet Yellen to reconsider the lower allocation, which would be split between two payments separated by a 12-month span. The Democratic lawmakers called the reduced allocation “problematic” for the state as it looks to rebuild from the ongoing COVID-19 pandemic.

“This will significantly reduce the funding that will be available for Wisconsin’s current pandemic response operations and to continue to meet immediate needs and restore economic well-being,” Evers and Baldwin wrote in the letter.

While the Congressional Research Service had estimated earlier this year the state would receive $3.2 billion under the most recent stimulus package, the Treasury Department on Monday informed the state that the final allocation will instead be $2.5 billion, split into two payments.

The Treasury Department has the ability to withhold a portion of a state’s funding based on unemployment rates, which was the case in Wisconsin. The Department of Workforce Development reported last month that the state’s unemployment rate in March was 3.8%. In February 2020, before the pandemic caused Wisconsin’s jobless rate to skyrocket, the state unemployment rate was 3.5%.

While preliminary data show the state added 12,900 total non-farm and 11,100 private-sector jobs between February and March of this year, Wisconsin was still down 129,000 non-farm jobs and 98,300 private-sector jobs when comparing this March with last March.

Officials with Wisconsin Manufacturers & Commerce on Tuesday urged Evers to follow a handful of other states, including Iowa, by ending Wisconsin’s participation in the enhanced federal unemployment benefits program, which offers individuals an additional $300 in weekly unemployment benefits. The federal program is slated to run through September, but Kurt Bauer, president and CEO of Wisconsin Manufacturers & Commerce, said in the letter the program has exacerbated workforce shortages in many industries.

“Business leaders tell us every single day that this expanded unemployment benefit is creating a strong disincentive to work and making it harder for them to hire,” Bauer wrote. “We cannot afford to allow able-bodied workers to remain on the sidelines while thousands of jobs are available today.”

WMC also has asked that Evers use some of the federal stimulus provide sign-on bonuses to create added incentive to work. Evers’ office did not respond to a request for comment on the WMC letter.

Evers and Baldwin described Wisconsin’s reduced funding and the split allocations as “problematic.”

“This split and timing does not necessarily reflect the urgency or the level of need that many businesses, families, workers, and community organizations have right now,” Baldwin and Evers wrote. “Over the past year, we have been clear that our response to the pandemic must be robust and it must be flexible to meet the specific needs that our state faces.”

The governor has sole discretion over the use of federal funds, and Evers has vetoed multiple attempts by state Republicans, who control the Legislature, to use those dollars, including a package of 11 bills that would have used those funds to pay down state debt, provide $200 million in assistance for small businesses and provide $500 million for broadband expansion, among other things.

Rep. Mark Born, R-Beaver Dam, co-chair of the state’s budget committee, on Tuesday again called for a meeting with Evers on the use of federal funds.

“Regardless of the exact amount, there’s a lot of federal money coming into the state, and we would love to have a discussion with the governor on how that is going to be spent,” Born said.

Republican leaders, who have criticized the governor for a lack of firm details on the use of federal funds, have said the use of that money could factor into the budget process.

It remains to be seen how the reduced funding, or its split allocation, will affect the governor’s plan. Evers has pledged to spend $2.5 billion on economic relief for families, workers and small-business owners, including $50 million for the tourism industry and $600 million to support businesses affected by the pandemic, including $420 million in grants to small businesses.

He has also pledged to spend $500 million on the continued pandemic response and $200 million on infrastructure, including broadband.

Finalized federal guidance for the stimulus funds — announced Monday — allows the funds to be used to respond to the COVID-19 pandemic or its negative economic impacts, including assistance to households, small businesses and nonprofits, or aid to affected industries such as tourism, travel and hospitality.

Other acceptable uses of the funds include providing premium pay to eligible workers performing essential work during the pandemic. It also can be used to pay for government services that were cut due to the pandemic’s effect on revenues and on water, sewer or broadband infrastructure.

The guidance also appears to prohibit its use for some state Republican priorities — specifically, paying down state debt.

'Every aspect of our lives has been turned on its head': The COVID-19 pandemic one year on

A year into a once-in-a-century pandemic, Madison and Wisconsin continue to grapple with a virus that's killed thousands, destroyed businesses, upended school and changed nearly all aspects of everyday life.

It's been 12 months of grief, shutdowns, reopenings, protective measures, partisan fighting, lawsuits and loss. And now, hope. 

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“Truly every aspect of our lives has been turned on its head,” said Malia Jones, a UW-Madison infectious disease epidemiologist. 

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"If you would have told me last March that we'd be virtual for a year, I'd never, ever would have believed it."

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"We’re used to taking whatever comes through the door," said nurse Maria Hanson, who started journaling about the pandemic soon after treating the patient.

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"It’s a risk vs. reward thing and I risk my life to save others," said Brandon Jones, who always worried about bringing the virus home to his wife and two kids.

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“Usually a funeral is a major step in understanding that a life was lived and the person is now gone,” he said. “If families don’t get that, it’s just really hard.”

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Rev. Marcus Allen knew what bringing everyone together could do for their spiritual and mental health. But each time he considered reopening the church, COVID-19 cases surged.

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"I was getting my work done from 9 p.m. to 3 a.m. every day," she said.

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“Reporting the death counts out day after day was draining,” she said. “It felt like I was announcing a funeral every day.”

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A year into a once-in-a-century pandemic, Madison and Wisconsin continue to grapple with a virus that's killed thousands, destroyed businesses…

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COVID-19 changed nearly everything about our world, even how we see it. Here are some of the State Journal's top images of the pandemic.


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