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How will federal relief money will be divided in Louisiana?

Louisiana State Capitol building in Baton Rouge
Louisiana State Capitol building in Baton Rouge
Updated: May. 25, 2021 at 10:08 PM CDT
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BATON ROUGE, La. (LSU Manship School News Wire) - Louisiana is one step closer to using the federal money it is receiving from the American Rescue Plan after a bill by legislative leaders passed the Senate Finance Committee Tuesday.

The American Rescue Plan is a $1.88 trillion federal aid package, which gives each state a minimum of $500 million to offset the economic downfalls caused by the COVID-19 pandemic. Louisiana will receive $5.18 billion in direct aid to state and local governments.

“We’ve tried to make the highest and best use of the dollars that are available to us, balancing these different pots of money,” Jay Dardenne, the commissioner of administration, told the committee.

House Speaker Clay Schexnayder, R-Gonzalez, wrote the bill, HB642, along with Rep. Jerome Zeringue, R-Houma, and Senate President Page Cortez, R-Lafayette. The bill also will help improve infrastructure.

The bill received unanimous approval from the House Chamber and will now head to the Senate floor. It divides up the money and sets rules along these lines:

Louisiana Loggers Relief Fund - $10 million

Under the bill, timber harvesting and hauling businesses can apply for grants up to $25,000 if they meet the criteria for the Louisiana Main Street Recovery fund.

In June 2020, the Legislature created the fund to disperse $275 million in relief for small businesses. The program gave grants of up to $15,000 to more than 20,000 businesses across the state.

The grants are only awarded to companies with less than 50 employees that were in Louisiana as of March 1, 2020. The businesses must have experienced a gross revenue loss of 10% or greater in 2020 compared to 2019.

Louisiana Save Our Screens Fund - $4.5 million

This Main Street Recovery program will provide grants for movie theaters in Louisiana that were forced to close or reduce capacity due to COVID-19. The grants are limited to $10,000 for each movie screen with a limit of $50,000 for each theater.

Adam Holland, the Mayor of Oak Grove, spoke to the Finance Committee about the Fiske Theatre, a historical one-screen cinema his family operates.

“I want to make clear that I have no objections to the corporations that are going to receive aid from this bill,” said Holland. “It’s necessary to point out the fact that the way this bill is presently written, the corporations with stockholders will be receiving the vast majority of these funds.”

Committee members promised Holland they would work on an amendment to better suit independent operators.

Cortez said that another amendment will be added before the bill reaches the floor to exclude any theaters that screen X-rated films.

Louisiana Port Relief Fund - $55 million

The fund will provide grants to Louisiana port authorities that suffered financial hardships. The program will use the requirements set by the Louisiana Main Street Recovery Program.

Louisiana Nonprofit Assistance Fund - $10 million

Originally the Nonprofit and Small Business Fund with $50 million to be distributed, the authors amended the bill to allocate to only nonprofits.

“We believe that the small businesses were taken care of with the Main Street Program,” said Cortez. “So we’ve eliminated $40 million from that, but we left $10 million in for the nonprofits who may not have been able to qualify for the Main Street Program.”

The Department of Revenue will be tasked with administering and outlining eligibility. The grants are $25,000 per eligible business, which must have filed taxes in Louisiana in 2019 and 2020.

Louisiana Water Sector Fund - $300 million

Separate from the Main Street program, this fund will provide grants to communities in need of updating their water and sewer systems. A review panel, consisting of 10 members chosen by Schexnayder and Cortez, would review and rate projects. Cities would submit their requests online, and the review panel would prioritize the most critical infrastructure needs.

Cortez said more money might become available from other legislation.

“There will likely be more requests than we have money,” he said. “The hope is that we could utilize other sources. If we could combine all these to get more than $300 million of water and wastewater projects over the next fiscal year, we would be doing a great service to the state and the citizens.”

Federal money also will be distributed to cities that could choose to fund their own water infrastructure construction. Zeringue said local communities would receive $1.8 billion, which could create a system where local and state governments work together in funding projects.

Granting Unserved Municipalities Broadband Opportunities Fund - $90 million

The GUMBO fund will provide grants to help fund high-speed internet to rural and disadvantaged areas.

Southwest Louisiana Hurricane Recovery Fund - $30 million

As Lake Charles and the southwestern corner of the state are still recovering Hurricane Laura last August, the state will use $30 million to help rebuild the area.

McNeese State University will be the largest project and will get $4 million for improvements. Seventy-six schools and the international airport also will receive money for repairs.

Unemployment Fund - $490 million

The bill authorizes the state treasurer to transfer $490 million out of the rescue fund to pay its federal debts from unemployment payments during the pandemic. Cortez said $400 million will go to “shoring up” the unemployment trust fund.

Construction Sub-Fund of Transportation Trust Fund - $563 million

As part of the American Rescue Plan, the state must use some of the money toward infrastructure. The $563 million will go toward government services that have faced a reduction in state services.

Capitol Technology Fund - $15 million

$15 million will be used to update the technology inside the Capitol.

Louisiana Tourism Revival Fund - $77.5 million

The $77.5 million will go toward marketing the state’s tourism.

Health Care Employment Reinvestment Opportunity - $5 million

The HERO fund, which will start when the bill passes, provides money for hiring demands for nurses and other health professionals. The bill includes incentives like tuition forgiveness upon employment in a Louisiana health care facility and bonuses for working in medically underserved areas of the state.

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