Biden administration threatens to claw back Covid funds from Arizona over school anti-mask policies

U.S. first woman Jill Biden speaks with folks throughout a tour of a COVID-19 vaccination website at Isaac Center Faculty in Phoenix, Arizona, June 30, 2021.

Carolyn Kaster | Pool | Reuters

The Biden administration on Friday threatened to rescind thousands and thousands of {dollars} in federal coronavirus assist for Arizona, accusing the state of utilizing the funds to undermine efforts to cease the unfold of the virus.

Republican Gov. Doug Ducey’s workplace has 60 days to both change two federally sponsored state college packages totaling $173 million, or redirect the cash towards “eligible makes use of,” the Treasury Division stated in a letter.

The packages impose situations that discourage compliance with sporting masks in colleges, contradicting steering from the Facilities for Illness Management and Prevention on cut back Covid transmission, the letter stated.

If Arizona fails or refuses to adjust to Treasury’s calls for, the Biden administration might claw again that stimulus cash and withhold a second tranche of pandemic aid funding, Treasury stated.

Ducey’s workplace didn’t instantly reply to CNBC’s request for touch upon the letter.

The federal funds in dispute come from the Coronavirus State and Native Fiscal Restoration Funds program, or SLFRF, a $350 billion chunk of the multitrillion-dollar Covid aid package deal, dubbed the American Rescue Plan, that President Joe Biden signed into legislation final 12 months.

The funds are supposed “to mitigate the fiscal results stemming from the COVID-19 public well being emergency, together with by supporting efforts to cease the unfold of the virus,” Treasury famous within the letter to Ducey’s Workplace of Strategic Planning and Budgeting.

However Arizona’s two college packages use the federal cash to “impose situations on taking part in or accepting a service that undermine efforts to cease the unfold of COVID-19 and discourage compliance with evidence-based options for stopping the unfold of COVID-19,” the letter stated.

The $163 million Schooling Plus-Up Grant Program, as an illustration, permits funds be given solely to colleges that don’t implement masks necessities, Treasury wrote.

The opposite program in query, totaling $10 million, offers grant cash to assist dad and mom transfer their youngsters out of colleges which are deemed to be imposing “pointless closures and faculty mandates.”

That program “is accessible solely to households if the coed’s present or prior college requires using face coverings” in the course of the college day, Treasury’s letter stated.

The most recent letter, despatched by appearing Deputy Chief Compliance Officer Kathleen Victorino of the Treasury Workplace of Restoration Applications, follows months of back-and-forth between the Biden administration and the Grand Canyon State.

The Treasury Division in October had requested Arizona to elucidate how it might repair the problems recognized within the two college packages.

The state responded a month later, detailing its rationale for the anti-mask situations however failing to “describe any plans for remediation of the problems recognized,” Victorino wrote.

The most recent combat over Covid security guidelines comes because the extremely transmissible omicron variant fuels an unprecedented surge in circumstances. The U.S. Supreme Court docket on Thursday blocked enforcement of the Biden administration’s rule for workers in massive corporations to both get vaccinated or obtain weekly testing, however the excessive courtroom left intact a vaccine mandate for health-care staff.

However the disputes precede omicron. Final 12 months, Arizona’s Republican-controlled legislature tried to cross provisions banning masks mandates and different Covid security measures. In November, the state Supreme Court docket dominated that these measures have been handed illegally.

CNBC’s Tom Franck contributed to this report.

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