Administration moves to restrict federal COVID money for most municipalities

This week, members of the Illinois Municipal League, which represents local governments, joined with manufacturers and retail business owners to push back against a new rule from the Illinois Department of Commerce and Economic Opportunity (DCEO) regarding how funds from the federal Coronavirus Aid, Relief, and Economic Security Act (CARES) are distributed to local governments.

The rule imposes additional state restrictions, disallowing expenses that are eligible under federal guidance. These restrictions are stricter than the ones that were imposed on Chicago, Cook County and the collar counties that received funding directly from the CARES act.

Those communities were able to use federal funds for economic development expenditures, while the state’s restrictions make that type of expenditure ineligible for reimbursement. Additionally, DCEO’s rule reduces the period for local governments to incur eligible expenses by 60 days.

These restrictions, over and above the constraints placed by the federal government, will limit local leaders’ ability to craft innovative solutions for their own communities. If, due to these stricter rules, a local government doesn’t have sufficient eligible expenses, the administration will be able to re-appropriate the funds to other communities at its own discretion.

The rules will be up for a possible review by the bipartisan Joint Committee on Administrative Rules (JACR) at an upcoming hearing.

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