U.S. Rep. Josh Gottheimer knows the idea of the federal government taking back COVID-19 relief funds as part of a debt-ceiling compromise is hard to imagine for many.
Start with the logistics: Money was allocated for any number of reasons to any number of states, counties and municipalities.
Go to the lingo: Are we talking about money that has not been spent, or just not allocated?
Then, go to the lawsuits: Can you imagine how quickly state and local governments would fight back?
Gottheimer (D-5th Dist.), who has made a name for himself as the king of the clawbacks, isn’t taking chances. In his mind — and in his corner of politics — the idea is more realistic than some may believe.
“It’s definitely one of the issues that the Republicans have put on the table for the negotiation on the debt ceiling,” he said. “Obviously, it’s something I’m deeply concerned about.”
Farfetched? Hardly, Gottheimer said.
“What’s farfetched, in my opinion, is that people would even consider driving our country off the fiscal cliff and not paying our debts and letting us default,” he said. “I’ve been working on (the debt ceiling) issue for a couple of months. And I’ve talked to a lot of my colleagues on the far right, who think it’s a good idea to do that. I would have said that was farfetched months ago.”
Because of this concern, Gottheimer sent a letter to all the municipalities and counties he serves in the 5th Congressional District — a narrowly drawn region in the northernmost part of the state that stretches from the George Washington Bridge to the Pennsylvania border, covering 65 towns in Bergen, Passaic and Sussex counties.
He asked them to consider allocating any of their unused money — funding they thought they had until 2026 to use — just to be sure. And he reminded them that, while the funding came as a response to the pandemic, the funds could be used for a number of things, including infrastructure improvements and broadband expansion.
Let’s be honest, no one really knows how much money was sent out — or how much was sent directly to counties and municipalities. Some estimate the state still has more than $5 billion in unused funds — which is far more than many other states.
Natalie Hamilton, a spokesperson for Gov. Phil Murphy, said any movement to force states to return money would be devastating.
“Many states, including New Jersey, have accounted for pandemic relief funds in their spending plans, and stripping states of these promised funds will create significant gaps in state efforts to rebuild post-pandemic,” she said. “Taking back these funds would set an irresponsible precedent wherein states cannot rely on commitments made by the federal government.”
This much is clear, Gottheimer wants to make sure his municipalities — the ones who have benefited so greatly from his clawback efforts over the years — don’t lose what they have.
“I fought for $200 million of broadband money that came to the state of New Jersey alone,” he said. “That’s got to get out the door. The idea that we would lose what we fought so hard to get would be bananas.
“So, we have to make sure that our towns, who thought they had until 2026, make sure they get these resources allocated.”
Anything less would be devasting, Gottheimer said.
“I’ll call it the reverse claw,” he said. “If (the federal government) tried to do that, obviously, that would have a big impact on taxpayers, and our small businesses. I worry a lot about that. I’ve been very focused on that.”
The same can be said for getting the debt crisis settled.
Gottheimer said he knows these types of negotiations always go down to the end. And he said he remains “optimistic” that a deal will get done.
But, what kind of deal?
“The fact that this (clawback idea) is on the table for discussion is concerning,” he said. “I don’t want to give these dollars back to Washington, D.C. They should stay in Jersey, where they belong.
“But I worry that there could be some deal cut where part of these resources go back. That’s not a gamble I want to take.”