💲 Unused pandemic funds given to NJ may be clawed back by the feds
💲 Republican leaders say the situation is a horrific disgrace
💲 They are imploring Gov. Murphy to spend the money before it’s gone

With negotiations continuing in Washington, D.C. and time running out to raise the nation’s debt limit President Biden has indicated he is open to the idea of taking back unspent federal pandemic emergency money that was given to the states to counter the negative economic impact of COVID.

If that happens New Jersey could lose roughly $5 billion in funds that haven’t been allocated yet.

State Sen. Michael Testa, R-Cumberland, a member of the Budget and Appropriations Committee, said the Murphy administration has had two years to figure out how to use this money, and now it may all go out the window “while businesses and New Jersey families have struggled severely in the wake of the COVID-19 era.”

Many businesses gone forever

Restaurant closed - Photo: Townsquare Media Illustration
Restaurant closed - Photo: Townsquare Media Illustration

He noted many Jersey businesses have struggled mightily since the pandemic lockdowns began and “certainly those businesses, one-third of which closed their doors forever, and so many more that were hanging on by a very thin thread, could have used this federal stimulus money.”

He said members of the Budget and Appropriations Committee “have offered and will continue to offer very quick solutions in order to spend this federal money that has gone unspent.”

State Sen. Declan O’Scanlon, R-Monmouth, who also serves on the Budget and Appropriations Committee, said the situation is nothing short of disgraceful.

“We get very little for all of the tax money we give to the federal government, it would be horrific to send money that we have back to the federal government.”

Victoria Gnatiuk GettyImages
Victoria Gnatiuk GettyImages

He said there is no reason the funding we received from the feds two years ago is still sitting unused, and “it’s value is being eaten away by inflation. It’s stunning and it’s scary, it’s a real problem.”

O’Scanlon stressed if the money goes back to the federal government, “it’s not like it’s going to pay debt, it’s going to go to other places to the same people that receive all the tax money that New Jerseyans pay to the federal government now and see very little return on.”

Testa noted the governor did approve using some of the COVID relief money to buy a new fleet of SUVs for state leaders to drive around in, but despite Murphy’s push to electrify the Garden State, none of the new vehicles are electric.

Hoping for the best

Phil Murphy

When the governor’s office was asked to comment on the situation, deputy press secretary Natalie Hamilton said:

“While debt ceiling negotiations are still ongoing, the Governor hopes for an expeditious resolution, avoiding default and best serving the American people. However, many states, including New Jersey, have accounted for pandemic relief funds in their spending plans and stripping states of these promised funds will create significant gaps in state efforts to rebuild post-pandemic. Taking back these funds would set an irresponsible precedent wherein states cannot rely on commitments made by the federal government.”


David Matthau is a reporter for New Jersey 101.5. You can reach him at david.matthau@townsquaremedia.com

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