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How Does the 2021 Stimulus Affect Connecticut Families?

March 17, 2021

by Mike Hanley,
Consultant to the Partnership for Strong Communities

On March 11, President Biden signed into law the most recent and significant stimulus proposal. This legislation will provide $1.9 trillion in resources to address the worst health and economic crisis our country has seen many, many decades. COVID-19 has already killed over 500,000 Americans. Across the US, approximately 40 million folks who owe thousands in rent are facing possible eviction. In addition, over half a million people are homeless. Businesses have closed and jobs have been permanently lost, with 20 million individuals receiving unemployment benefits. Our education system, from early childhood to college, has been severely disrupted.

To address the impact of this pandemic, this act includes $14 billion for vaccine distribution and administration. Eleven billion dollars for public health investments including expansions of community health centers. An additional $350 billion to state and local governments to address COVID-related expenses, as well as lost revenue. It will inject $50 billion into the FEMA Disaster Relief Fund for both targeted and flexible state assistance (i.e. CT utilized FEMA funding for the homeless shelter decompression initiative). The ARP also provides $45 billion in rental and mortgage assistance as well as funding for utility arrearages, preventing homelessness and allowing people to remain in their homes.  There is $3.9 billion set aside for mental health and substance use disorder treatment. Forty billion dollars is authorized to support child care through CCDBG and other critical programs. It increases the Child Tax Credit to $3,000 ($3,600 for children under age six), and triples the Earned Income Tax Credit. It boosts weekly supplemental unemployment benefits by $300. For nonprofits and other small businesses, it includes $7 billion for expansion of the Paycheck Protection Program. The Act also addresses the nutrition needs of families by providing an additional $12 billion for SNAP, WIC and other food programs.

And, most importantly, ARP is projected to reduce the poverty rate by one-third; and cut child poverty by fifty percent!

While many details for the use of these critical resources have yet to be announced, we know that overall Connecticut will receive over $10 billion; including $2.6 billion for state government, $1.6 billion for municipalities and more than $1 billion for elementary and secondary education systems as they work to recover from the impact of this pandemic. As a rule of thumb, our state is allocated one percent of a federal authorization (based on population) unless otherwise specified.

We will provide updates as more information becomes available.