COLUMBIA — South Carolina will receive a nearly $8.9 billion share from the latest federal COVID-19 relief package pushed by the Biden administration.
That new influx of money is nearly as much as the state’s general fund budget and represents a third of total spending by all state agencies, when combining all sources.
The funding allocated to the state, as part of the larger $1.9 trillion American Rescue Plan passed by Congress on March 11, also is just under the $9.5 billion the state would otherwise collect this year in federal tax dollars.
“We had fewer things shut down than they did in other places,” Gov. Henry McMaster said. “We took a deliberate and careful approach and it worked. We went into the virus with a great economy and now we’re coming out with almost as much.
“The question is what do we do now because here comes more money,” McMaster said.
Of the funding coming to the Palmetto State, $2.5 billion will go to the state government to be allocated by lawmakers. Legislators will also have a say on how to spend nearly $188 million of infrastructure funding, the guidelines for which are still being developed by federal rulemakers.
The remaining $6.3 billion will go directly to municipalities, counties, schools and various agencies to be expended.
McMaster reconvened a special committee, called AccelerateSC, which he had originally tasked with making recommendations on safely scaling the state’s economy back up amid the coronavirus pandemic.
As it did with previous federal relief funding, that task force will now make recommendations to state lawmakers on that portion of funding directly controlled by the state.
The State Legislature likely will return in the fall to pass its spending plan for that money.
Funds may be used on expenditures including COVID-19 public health programs; broadband; reopening of key industries, like tourism; direct aid to small businesses, water and sewer infrastructure, early learning programs and underprivileged schools; and any of the expenses allowed under the previous coronavirus federal aid packages passed by Congress during the Trump administration, said Brian Gains, director of the state’s Executive Budget Office.
The remaining dollars will be distributed as follows:
$1.6 billion to cities and counties, including more than $21 million to Charleston, $27 million to Columbia, $17.9 million to Greenville and $7.9 million to Myrtle Beach.$3.4 billion for education and child care, including $2 billion to K-12 schoolsMore than $391 million for various public health programs$605.6 million for public assistance programs, such as Head Start, heating and cooling assistance, home-delivered meals, emergency rental assistance and food stamps$57.5 million for transportation$60.7 million in credit to small businesses
Most of the AccelerateSC committee’s discussion about the latest round of funding centered around ensuring state expenses don’t duplicate local governments’ use of their funding. Setting up a cost share program was suggested to make the dollars go further and avoid overlap.
“A lot of these infrastructure projects that months ago seemed insurmountable now seem feasible,” said Tyler Servant, an Horry County councilman who sits on the task force.
Though McMaster said it has been made clear by federal treasury officials that the money is not to be used for things like roads and bridges, as much of that is expected to be funded by the anticipated $547 billion surface transportation bill currently being debated in Congress.
Other initial suggestions that came out of the AccelerateSC meeting June 15 included an update of the state’s IT systems; investment into airports; increased spending on state parks, which have experienced heavy use during the pandemic; and investment in water and sewer systems.
“I think we could jump ahead 10 years or so if we’re really smart about it,” McMaster said of the influx of cash. “It’s a lot of money. We need to use it wisely to make transformative, once-in-a-lifetime investments that allow us to compete nationally and globally in the future.”
Gaines also told the AccelerateSC group that all of the $1.9 billion received as part of the last coronavirus aid package, the federal CARES Act, has been spent or allocated.
When doling out the CARES Act dollars, the state entered a $10.9 million contract with the private firm Guidehouse for auditing and review of applications for funding. The task force recommended that the firm be used again for these services.
This most recent round of funding can be used on expenses incurred between March 3 and December 31, 2024. That timeline could also be extended until December 31, 2026, for certain projects.