WASHINGTON — California, Texas and New York would receive 29% of the $350 billion in direct aid that President Joe Biden has proposed for states and cities in his COVID-19 relief bill, according to a USA TODAY analysis of the projected allocations.
That’s slightly more than the three states’ share of the U.S. population – 27%
The minor discrepancy is the result of a formula used in Biden’s American Rescue Plan that largely relies on the number of unemployed citizens in each state at the end of 2020, not overall population, to determine the funding amount for each state.
Biden’s legislation, which carries a $1.9 trillion overall price tag, heads for a vote in the Senate later this week after clearing the House last week by a mostly party-line 219-212 vote.
The package includes $350 billion in aid designed to replenish tax revenue collections that decreased during the pandemic so states and local governments can pay employees and take care of core services.
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Republican governors have blasted the plan’s funding formula, arguing it “punishes” states that kept businesses open amid the coronavirus pandemic and is “biased” toward Democrat-led states that enforced shutdowns. Advocates of the legislation say the arrangement allows for distribution to more closely address actual needs.
Yet the most populous states would still generally receive the most money. The smallest states would receive the least. Although some states would receive more money – others less – when using unemployment as the criteria, the differences tend to be modest percentages.
California, the most populous states, would receive the most money, $42.3 billion – including $26.2 billion for its state government and $14.6 billion across local governments. The second most populous state, Texas, would take in the second most ($27.3 billion) in combined dollars.
But the third largest recipient would be New York, which would receive $23.5 billion, even though Florida is the third largest state by population, according to U.S. Census Bureau 2020 estimates. Florida would receive $17.3 billion, fourth most among states.
The reason for the shuffling: New York, one of the first states to enforce a strict lockdown order after facing the brunt of the pandemic last spring, had an 8.2% unemployment rate in December, nearly 2 points higher than Florida’s unemployment rate of 6.1%.
House Republicans have highlighted how GOP-led Florida, for example, would receive $1.2 billion less with unemployment as the criteria instead of population. But it marks only a roughly 7% net loss for the state.
Georgia, another state led by a Republican governor, would collect $1.3 billion less under the formula, a roughly 14% net loss, but would still receive $8.2 billion. Virginia, a Democratic-led state, would receive $6.9 billion, also roughly 14% less than if population dictated the allocation.
Conversely, California would receive about 15% more funds using unemployment the criteria, New York about 10% more, New Jersey 13% more and Texas 5% more.
Funding projections are according to the House Committee on Oversight and Reform and reflect data as of Feb. 25.
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How Biden’s bill would allocate funds differently
The consideration of unemployment marks a change from last year’s allocation of COVID-19 relief funds.
The federal CARES Act, passed last March under President Donald Trump, provided $150 billion through the Coronavirus Relief Fund across all states, tribal governments, territories and the 38 cities with more than 500,000 people. Funds were limited to expenses “directly related” to COVID-19, not replacing lost revenue like Biden’s bill would do.
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Also unlike Biden’s bill, the CARES Act divvied up the money based on population. The CARES Act delivered a baseline of $1.25 billion to all 50 states, boosting the share of funds for small states compared to Biden’s bill. The American Rescue Plan proposes a lower baseline of $500 million for all states.
Most of the direct aid in Biden’s bill, $300 billion, would be allocated proportionate to states’ unemployment as determined by the number of unemployed individuals over a three-month period that ended in December.
Vermont would receive the least amount in direct aid under Biden’s bill, $852 million, even though Wyoming is the least populous state. That’s because Wyoming had a higher unemployment rate (4.8%) in December than Vermont (3.1%).
Biden states compared to Trump states
Democratic-leaning states would get a slight boost in Biden’s bill compared to Trump’s CARES Act.
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Three out of every five dollars (60.4%) of the direct aid in Biden’s bill would go to states that Biden won in the November election, according to a USA TODAY analysis. An analysis from Reuters found the same states received about 56% of relief dollars in last year’s CARES Act.
The $350 billion in aid would be divided into four pools: 195.3 billion in aid for state governments; $130.2 billion for city and county governments; $20 billion to tribal governments; and $4.5 billion for U.S. territories.
The states receiving the most funds behind California, Texas, New York and Florida, would be Illinois and Pennsylvania, both $13.5 billion, followed by Ohio, around $11 billion.
The states projected to receive the least amount of funds besides Vermont and Wyoming are South Dakota and North Dakota, each $1 billion, and Alaska, $1.1 billion.
Reach Joey Garrison on Twitter @joeygarrison.