Biden administration threatens to claw again Covid funds from Arizona over faculty anti-mask insurance policies

U.S. first woman Jill Biden speaks with folks throughout a tour of a COVID-19 vaccination website at Isaac Center Faculty in Phoenix, Arizona, June 30, 2021.

Carolyn Kaster | Pool | Reuters

The Biden administration on Friday threatened to rescind thousands and thousands of {dollars} in federal coronavirus support for Arizona, accusing the state of utilizing the funds to undermine efforts to cease the unfold of the virus.

Republican Gov. Doug Ducey’s workplace has 60 days to both change two federally backed state faculty applications totaling $173 million, or redirect the cash towards “eligible makes use of,” the Treasury Division stated in a letter.

The applications impose situations that discourage compliance with carrying masks in colleges, contradicting steering from the Facilities for Illness Management and Prevention on easy methods to cut back Covid transmission, the letter stated.

If Arizona fails or refuses to adjust to Treasury’s calls for, the Biden administration might claw again that stimulus cash and withhold a second tranche of pandemic reduction funding, Treasury stated.

Ducey’s workplace didn’t instantly reply to CNBC’s request for touch upon the letter.

The federal funds in dispute come from the Coronavirus State and Native Fiscal Restoration Funds program, or SLFRF, a $350 billion chunk of the multitrillion-dollar Covid reduction package deal, dubbed the American Rescue Plan, that President Joe Biden signed into legislation final yr.

The funds are supposed “to mitigate the fiscal results stemming from the COVID-19 public well being emergency, together with by supporting efforts to cease the unfold of the virus,” Treasury famous within the letter to Ducey’s Workplace of Strategic Planning and Budgeting.

However Arizona’s two faculty applications use the federal cash to “impose situations on taking part in or accepting a service that undermine efforts to cease the unfold of COVID-19 and discourage compliance with evidence-based options for stopping the unfold of COVID-19,” the letter stated.

The $163 million Schooling Plus-Up Grant Program, for example, permits funds be given solely to varsities that don’t implement masks necessities, Treasury wrote.

The different program in query, totaling $10 million, gives grant cash to assist mother and father transfer their youngsters out of colleges which are deemed to be imposing “pointless closures and faculty mandates.”

That program “is offered solely to households if the scholar’s present or prior faculty requires the usage of face coverings” throughout the faculty day, Treasury’s letter stated.

The newest letter, despatched by performing Deputy Chief Compliance Officer Kathleen Victorino of the Treasury Workplace of Restoration Packages, follows months of back-and-forth between the Biden administration and the Grand Canyon State.

The Treasury Division in October had requested Arizona to clarify how it might repair the problems recognized within the two faculty applications.

The state responded a month later, detailing its rationale for the anti-mask situations however failing to “describe any plans for remediation of the problems recognized,” Victorino wrote.

The newest battle over Covid security guidelines comes because the extremely transmissible omicron variant fuels an unprecedented surge in instances. The U.S. Supreme Courtroom on Thursday blocked enforcement of the Biden administration’s rule for workers in massive firms to both get vaccinated or obtain weekly testing, however the excessive court docket left intact a vaccine mandate for health-care employees.

However the disputes precede omicron. Final yr, Arizona’s Republican-controlled legislature tried to go provisions banning masks mandates and different Covid security measures. In November, the state Supreme Courtroom dominated that these measures had been handed illegally.

CNBC’s Tom Franck contributed to this report.

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