HILL TAX BRIEFING: States Get Treasury Guidance on Pandemic Aid

May 11, 2021, 10:12 AM

States seeking a slice of the $350 billion in funding available under the latest relief law received some guidelines from the Treasury Department on what they can and can’t do with the money.

The law (Pub. L. No. 117-2) included a provision that prevents states and municipalities from using funds to “directly or indirectly offset a reduction in the net tax revenue.” Treasury’s fact sheet reiterated that provision, which has triggered legal challenges by several states, including Ohio.

The guidelines say the funds can be used by governments for activities such as rehiring workers or supporting ...

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