The Alabama House green-lighted a $1.06 billion plan to spend COVID-19 relief money, but it may be months before Baldwin County knows how much, if any, of that money will reach its borders.
The American Rescue Plan Act (ARPA) was signed into law nearly two years ago at the federal level to help cover the cost of COVID-19 related expenses. Alabama's state government received $2.1 billion under the act.
Legislators appropriated $136,796,346 of that to Alabama's State Fiscal Recovery Revenue Replacement Fund with $10 million earmarked for COVID-19 recovery grants for emergency service providers. The state used another $400 million for prison construction costs and $80 million for health care costs.
When the legislature convened this year, a special session was immediately called to address how to spend the remaining nearly $1 billion.
In December, federal legislators changed COVID-19 spending guidelines to provide more flexibility to state and local governments in spending those pandemic funds.
Now, while some of those leftover funds will still be used for pandemic related recovery, the bulk will be used to buff up infrastructure and broadband access across the state.
The bill, sponsored by House Ways and Means General Fund Committee chair Rex Reynolds, R-Huntsville, allocates $400 million toward health care-related services, $660 million for water, sewer and broadband infrastructure and $55 million for eligible health emergency economic programs and services.
Any money not spent by the end of the fiscal year on Sept. 30 will be reappropriated for the same purposes in fiscal year 2023. The money can continue to be used through Dec. 31, 2026.
Where Baldwin County may see the most funds flow is into matching grants for public water and sewer infrastructure projects that will be awarded by the Department of Environmental Management.
Public water and sewer systems can submit projects to the department and vie for the dollars through a matching grant program. Projects will be awarded on a ranking system that factors in the needs for upgrades in communities experiencing population growth.
By distributing these funds as a grant through ADEM, legislators said it allows for better regulation and oversight into how the money is being used by these different entities. There are strict rules in place for how and where this money can be used coming from the federal government, so a state agency like ADEM is better equipped to handle that regulatory oversight and inspection because that is what they are already in place to do.
Funds used to expand access to internet broadband programs will be sent to unserved areas of Alabama, primarily in rural regions.
Nearly $100 million of the money earmarked for healthcare related funds will be sent to assist nursing homes, many of which took on enormous, unexpected expenses early in the pandemic when more staff was desperately needed.
Nursing homes across the state also spent a lot of funds on personal protective equipment (PPE), updated HVAC systems, COVID testing and built isolation units.
Another $100 million will be used to help buoy at least 16 rural hospitals across Alabama that are in immediate jeopardy of closing.
There was speculution that lawmakers would use some of the federal funds for a tax holiday from the grocery tax or other tax relief programs.
State Sen. Greg Albritton (R-Atmore) said those issues should be addressed during regular legislative sessions, not during a special session.
"This special session was only called specifically to deal with the issue of allocating this ARPA money. I know several bills have already been filed under the regular session regarding the grocery tax or tax rebates as Governor Ivey suggested in her State of the State Address and the longer length of the regular session gives the legislature the time to really study and debate the impact of those forms of tax relief to see what kind of impact that would have on our budgets and what would make the best impact on the people of our state," he said.
The bill now heads to the Alabama Senate.