Straight Talk About Steve: ARPA Fund

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Nebraska’s economy has weathered the COVID-19 pandemic better than any other state in the Union. According to Politico’s State Pandemic Response Scorecard, Nebraska’s economy ranks first in the nation. Nebraska continues to enjoy record high unemployment, and last fall the Department of Revenue reported that our state’s incoming tax revenue exceeded Forecasting Board projections by 7.7%.

Although our economy is doing so well, the State of Nebraska has received over $1 billion in federal funds to spend this year and next through the American Rescue Plan Act (ARPA). Nebraska is expected to receive $520 million for 2022 and an additional $520 million for 2023 for a total of $1,040,000,000.

Because I have a seat on the Legislature Appropriations Committee, how that money is spent is something that directly concerns me. The principles of fiscal responsibility have never been more relevant to our state than now. Therefore, today I would like to talk to you about the three most important principles of fiscal responsibility that should guide our legislators as they spend this money.

First, the guidelines for spending ARPA funds are very confusing and convoluted. Lawyers even struggle to decipher the ARPA rules. If we don’t strictly follow the rules for spending ARPA funds, we could find ourselves in a position where we have to repay the money to the federal government. The last thing Nebraskanians need on their backs is the added burden of giving even more of their hard-earned money to the federal government. Therefore, the first principle I will follow is to ensure that all of our ARPA funds stay in Nebraska.

Second, ARPA funds should only be used for one-time expenses. Because we will not receive these federal funds year after year, ARPA funds should not be used to create new programs that will require state funds for years to come. Instead, ARPA funds provide our state with the unique opportunity to repair or upgrade items that have deteriorated over the years.

Third, ARPA funds should be used to benefit the people of Nebraska, not government agencies. The main purpose of these ARPA funds is to get Americans back on their feet and help them recover from the ramifications of COVID-19 restrictions. Over the past two years, many small businesses have been forced to close, people have been laid off, and people have struggled to make ends meet. Therefore, ARPA funds should be used to help small businesses succeed, employ more Nebraskans, and provide relief to struggling families.

Lawmakers will have to practice fiscal discipline this year. Spending a billion dollars of other people’s money is a difficult task when the goal is to do it in a fiscally responsible way. I hope the Legislature doesn’t just view these ARPA funds as free money to spend on advancing their favorite government programs.

Government money is never free. Whether we realize it or not, Americans will eventually have to pay back every penny spent on these ARPA funds. The US national debt is approaching $30 trillion. If Americans were to pay off their total debt this year, each taxpayer would somehow have to come up with $238,534, according to the US Debt Clock. We must remember that the federal money we spend today will have to be repaid by future generations of Americans. Therefore, we must use these ARPA funds to develop our state’s economy so that future generations of Nebraskans can live and prosper in our state.

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