Economy

Yellen promises local aid will be distributed quickly after stimulus is passed

Key Points
  • Treasury Secretary Janet Yellen promised that getting aid to state and local governments will be a priority after the $1.9 trillion stimulus package is passed.
  • The aid was a sticking point in a bill that is expected to pass the House this week.
Treasury Secretary Janet Yellen attends an economic briefing with U.S. President Joe Biden in the Roosevelt Room at the White House in Washington, March 5, 2021.
Tom Brenner | Reuters

Treasury Secretary Janet Yellen vowed Tuesday that money appropriated for state and local governmental aid in the new stimulus bill will get out the door as quickly as possible.

With House passage of the $1.9 trillion spending plan imminent, Yellen said funneling out the $350 billion earmarked to make up for shortfalls in revenue will be a priority.

"The rescue plan will fund a massive immunization campaign. It will ensure people are able to keep a roof over their heads and that unemployment insurance checks still come in the mail," she told a virtual National League of Cities conference. "In the coming days, our Treasury team is going to work to get this aid out as in the quickest way possible – and the one that produces the greatest impact."

The governmental aid was one of the main sticking points in getting President Joe Biden's stimulus plan through Congress. The measure received no Republican support in the Senate and is likely to meet the same fate in the House.

GOP members contend that the allocation is a bailout for poorly run states and municipalities, while Democrats say it's an important part of seeing through the recovery.

"If we do our job, I am confident that Americans will make it to the other side of this pandemic – and be met there by some measure of prosperity. By the end of the year, I expect your city economies will resemble 2019 much more than 2020," Yellen said.

Along with the state and local aid, the bill also provides another $1,400 cash infusion to individuals, and appropriates funding for the health care battle against Covid-19 and a slew of other measures not directly related to the pandemic.

Yellen said the spending package is "not simply to fight fires and resolve crises, but to build a better country."

"This law will see us through the immediate crisis; clear away the chaos in front of our eyes and, eventually, let us lift our sights to the future," she added.

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