Orange County officials estimate the county government will receive at least $540 million in federal stimulus money for its COVID-19 response costs, with the first half potentially coming by the end of next week.
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The money will come directly to the county government as part of the CARES Act, the $2.2 trillion stimulus package signed into law last month. It set aside $150 billion in federal money for state, local, and tribal governments, divided among them through population-based formulas.
Under the stimulus law, state and local governments can use the money for “necessary expenditures” related to the COVID-19 pandemic from March 1 through Dec. 30 of this year that weren’t included their most recent budget.
Orange County officials haven’t publicly outlined what they would use the money for, but said they would start describing their plans this coming Tuesday at a county Board of Supervisors meeting.
“Counties are the front-line responders and we greatly appreciate the efforts of our [Congressional] delegation members throughout this process and we continue that partnership as the process moves forward,” county officials said in an emailed statement to Voice of OC.
County officials say they’re awaiting guidance from U.S. Treasury officials on what the money can and can’t be used for, which is expected to come out this Friday. But there are signs the feds responded well to what counties want to spend the money on.
“Treasury staff were very receptive to the arguments [the National Association of Counties] provided about reimbursable costs that should be covered,” the county said in its statement.
“We appreciate and need the funding and support of the Federal government and our congressional delegation members as we work together to ensure the safety and well-being for all of Orange County’s residents.”
When asked about the COVID-19 motel sheltering program, county officials have often expressed uncertainty about whether the federal stimulus money can be used to pay for the 25 percent of costs that aren’t being covered by the Federal Emergency Management Agency (FEMA).
County officials, including its legislative director Peter DeMarco, didn’t respond when asked if they’ve asked the Treasury Department whether they can use the stimulus money for the motel shelter and other COVID-related expenses.
Voice of OC contacted all seven members of Orange County’s congressional delegation on Thursday through their offices, asking whether they’ve asked Treasury officials to provide clarity more quickly on how the county can spend the funds. They either didn’t answer or said they were working on it without saying if they’ve reached out to Treasury officials yet.
“The County has recently indicated their need for additional guidance on how CARES Act funding can be spent and when Treasury will provide that guidance,” said Keith Higginbotham, spokesman for Rep. Alan Lowenthall, whose district includes much of western Orange County.
“The Congressman is working with other Members of the OC delegation to ensure that Treasury understands the County’s need for this guidance, and that this clarification is expedited to County officials,” his spokesman added. He didn’t return a follow-up message asking if the delegation had already made its request of the Treasury Dept., or if it was still pending.
“Treasury is expected to announce regulations soon under guidance as laid out under the CARES Act that Congress passed,” said Jake Abbott, a spokesman for Rep. Linda Sanchez, whose district includes the Orange County city of La Palma.
“The House is also establishing an oversight committee to provide accountability and so that cities and counties get what they need most. We know that even this won’t be enough. Congress is working on what more we can do.”
A spokesman for Rep. Gil Cisneros, whose district includes north Orange County, said on Thursday that the county hadn’t asked Cisneros to help get clarity on the funding guidance from the Treasury Department.
“We haven’t heard anything formal from the county, but we’re here as a resource to ensure that they get the guidance and the funding that they need,” said Cisneros’ spokesman, Cody Sibulo.
In addition to $500 million-plus in stimulus money to the county, federal officials also have agreed to pay 75 percent of the counties’ motel shelter costs, in an arrangement Gov. Gavin Newsom announced on April 3.
For the past several weeks, Orange County officials have been worried about whether they’ll get reimbursed for their COVID-19 costs, particularly emergency motel shelter beds the state wants in OC to prevent the virus’ spread among homeless people and the public.
As of Tuesday, the county had made nine motel rooms available to homeless people, out of the 2,300 rooms requested by the state almost four weeks ago.
Mayors and city managers across Orange County have been asking the county to make some of the funds available to cities as well. No cities in OC can receive the money directly, because the stimulus law transfers money only to local governments with a population of 500,000 or more.
“Through the quick distribution of this vital funding, cities will be able to greatly expand the number of testing sites serving our communities, secure and distribute personal protective equipment, provide our law enforcement and first responders with appropriate equipment, provide increased services to our residents in need, and work with community based organizations to help ensure the public health and safety of all our residents,” the mayors of 31 of the 34 cities in Orange County wrote in a letter to county supervisors Thursday.
County CEO Frank Kim has said the county is open to sharing some of the stimulus money with cities that request the funds for costs allowed under the law, which he emphasized isn’t yet clear. He’s asking cities to first request reimbursement directly from FEMA, before asking the county for CARES Act money.
Governors are now advocating for another $500 billion in federal stimulus money for state and local governments, which they’ve asked to be unrestricted to help cover funding shortfalls.
Meanwhile, Orange County has been receiving property tax revenues – its main unrestricted money source – about on par with last year, officials said.
As of Wednesday, OC taxpayers had paid 97.7 percent of the property taxes billed for the past year, compared with 97.8 percent at the same point last year, Treasurer-Tax Collector Shari Freidenrich said in an email Thursday.
The difference between last year and this year was 0.1 percent, or $15 million less than the year before, out of $7.2 billion in property taxes billed this year, Freidenrich said.
It comes after weeks of concern about whether property taxpayers will pay – and refusals by the county to provide clarity for taxpayers affected by job losses from the pandemic.
“As a fiduciary and a steward of public funds, I want to thank those taxpayers who were able to pay timely as we are paying those property tax dollars received by April 13 to local agencies next week,” Freidenrich said in her email Thursday to Voice of OC.
“For those taxpayers not able to pay timely, we want to be compassionate and generous with those directly impacted by COVID-19 to cancel their penalties. Every property tax dollar that we will be receiving between now and June 30, we will be distributing to these same agencies to fund local services.”
With the current property taxes tracking close to normal, Orange County officials have shifted to expressing longer-term concern about drops in property and sales tax revenues, given the major economic downturn spurred by the pandemic response.
Nick Gerda covers county government for Voice of OC. You can contact him at ngerda@voiceofoc.org.