PROVIDENCE -- Rhode Island would receive $1.25 billion as part of the $2 trillion coronavirus aid package negotiated by the White House and Senate leaders, US Senator Jack Reed said Wednesday.
Reed, a Democrat on the Senate Appropriations Committee, was one of 20 members of a bipartisan group of senators that worked on the emergency rescue package. He said he helped create a state stabilization fund that, if approved, would provide the equivalent of 12 percent of the state’s $10 billion budget.
The news comes as the pandemic is choking off sources of state revenue and Rhode Island legislative leaders are preparing to convene the Disaster Emergency Funding Board on Thursday to consider Governor Gina M. Raimondo’s request to borrow $300 million for cash flow.
Reed said the package includes a total of $150 billion for state and local governments, and he pressed to provide states with smaller populations, such as Rhode Island, with a minimum amount rather than a strictly per capita total. He noted that states have certain fixed costs no matter their population.
“It gives states some breathing room,” Reed said in an interview. "Without this money, even with extensive borrowing, they would have been looking at a shortage of cash in a few weeks, and some basic functions of government would have had to stop.”
The money must be used for expenses related to the coronavirus crisis, but requirements will be flexible, Reed said.
So, for example, the funds cannot be used to pay state employee pension obligations or added to a “rainy day fund,” he said. But the money could be used for the state Department of Health efforts to track the virus, for example, or public safety measures related to the outbreak.
Although the White House and Senate leaders struck a deal, the legislative text is still being drafted, Reed’s office said. The full Senate could vote later on Wednesday, and the House of Representatives, which is not in session, must also approve the measure before it can be signed into law by the president.
US Senator Sheldon Whitehouse, a Democrat, praised the proposed deal.
“COVID-19 has triggered an unprecedented public health and economic crisis, and Congress has put together a plan big enough to begin confronting it and reviving our economy,” Whitehouse said in a statement. “The stimulus bill sends significant resources directly to the Rhode Island hospitals on the front lines, where new stocks of protective gear, beds, and ventilators are urgently needed.”
The aid package would provide direct payments to most Americans, expand unemployment benefits, and provide a $367 billion program for small businesses to keep making payroll while workers are forced to stay home.
Reed said he helped craft the “state stabilization fund” that includes “a mandatory set-aside for small states like Rhode Island -- to ensure states, tribes, and local governments have an additional source of federal funds for the unexpected expenditures that are necessary to care for their citizens and combat this pandemic.”
Reed’s office said that checks of $1,200 would go to workers with incomes up to $75,000 per year before phasing out and ending altogether for those earning $99,000 or more. Families will receive an additional $500 per child.
The administration should be able to get the checks out by early April, and income criteria will be based on income reported on 2018 taxes, he said.
“The size and scope of this emergency funding is unprecedented,” Reed said in a statement, “but so is the severity of this pandemic and the economic trauma that families, businesses, and communities are facing.”
Reed’s office called the rescue package “historically large” and equivalent to about 9 percent of the US gross domestic product. It marks the third action taken by Congress to address the pandemic, after an $8 billion appropriation to help slow the spread of the virus and a $100 billion package that includes funds for free testing and expanded paid sick leave.
“This third round of funding begins to meet the scale and severity of the challenges we face," US Representative David N. Cicilline said. "It will provide significant resources to help Rhode Island hospitals treat their patients and keep health care workers safe.”
“While no legislation is perfect, this stimulus package is a product of extensive negotiations, and it will protect public health and spur our economy," US Representative James R. Langevin said. “It puts American families and workers first by putting money directly into their pockets.”
Meanwhile, Reed has been pressing the Trump administration to fully invoke all the powers of the Defense Production Act to mobilize a “war-scale manufacturing effort of medical equipment.”
Rhode Island has been scrambling to find swabs and other equipment needed to do wider testing for COVID-19, and Raimondo has talked repeatedly about the need for more face masks, gowns, and other equipment needed to protect health care workers.
In a statement, Reed called the failure to fully utilize the Defense Production Act “indefensible,” saying it “could lead to a shortage of life-saving supplies such as ventilators, respirators, and personal protective gear.”
In an interview, Reed also questioned the wisdom of President Donald Trump’s goal -- stated at a Fox News town hall on Tuesday -- of having the nation “opened up and just raring to go by Easter.”
“I think he has to follow medical advice, not his whims, and most of the medical experts indicate that would be premature," Reed said. “It has to be based on facts, not on his gut instincts.”
Those relevant facts include how many people are coming down with the virus, he said, and whether the country has enough test kits to continue to control the outbreak.
Edward Fitzpatrick can be reached at email@example.com