Indiana may end up using much of its remaining COVID-19 relief funding from the federal government to help pay off what it already owes the federal government. This week, state officials committed to using at least $400 million of the remaining $650 million in CARES Act money to replenish the Unemployment Insurance Trust Fund.
Office of Management and Budget Director Chris Johnston gave an update during Wednesday’s COVID-19 briefing. “That trust fund, which pays out unemployment insurance, has been drawn on to the tune of $1.4 billion,” he explained, “and in fact, the State of Indiana is borrowing from the federal government.”
But Johnston said the $400 million is only expected to be enough to retire the loan from the federal government. “The trust fund has spent $1.4 billion, and over a billion dollars is what the expected balance should be, so that’s not even starting to make a deposit, as to growing that balance back to where it needs to be, which is what employers have to do when they pay their payroll taxes,” Johnston said.
As for the rest of the CARES Act money, Johnston said the state is looking into providing assistance to schools that have had trouble applying for FEMA’s Public Assistance Program. “Those are costs that the schools have incurred,” he said. “They’ve submitted their applications to FEMA, but unfortunately, FEMA is denying several of those applications. I was given a list of about 68 applications, and I believe 60 of them have been denied. So we think that that is something that we need to take a look at and see how we can assist through the Coronavirus Relief Fund.”
Another priority is the state’s small business assistance programs.
