The Big Payout: Colorado received close to $66 billion in pandemic aid. We tracked where that money went.
-
Loading... - Jenab Chan
- 15 Apr 2022
- 319 Views
- 0 Like
- 0 Comment
Colorado received nearly $66 billion in federal pandemic assistance over the past two years, a river of money that made its way to every corner of the state — from tourist attractions high in the mountains to large universities and hospitals along the Front Range down to tiny Main Street diners that dot the Eastern Plains.
The Denver Post examined more than 367,000 loans, grants and awards from multiple federal agencies in a first-of-its-kind analysis tracking how federal dollars filtered their way down to the state’s 64 counties. Distributions were hardly even, and the federal response, above and beyond the pandemic, likely caused the gap between the haves and have-nots in the state to widen.
Denver, Arapahoe and El Paso counties alone captured 44 cents of every federal dollar in assistance that could be localized. A dozen resort counties received as much federal money as the remaining 40 rural counties, even though those rural counties had 186,000 more residents. Pitkin County, home to Aspen, pulled in 5.5 times as much money per resident as Crowley, one of the poorest counties in the state.
Coloradans earned $8,000 more on average in income last year than they did before COVID-19 hit. Higher incomes and higher savings accrued disproportionately to households already in the upper-income brackets. Home values and stock prices surged due to federal policies, boosting the wealth of people holding those assets.
“We can argue whether this was too much stimulus, but you can’t argue about whether it worked. It worked,” said Richard Wobbekind, a senior economist at the University of Colorado Boulder Leeds School of Business.
The Colorado economy regained its pre-pandemic output in just over a year. The state recovered the 374,500 jobs lost after COVID-19 came on the scene in under two years, a much faster rebound than what followed the prior two recessions.
The federal money went to a variety of things — providing protective equipment, funding the transition to remote learning at schools, saving thousands of service jobs, helping restaurants and health care providers recover lost revenues, and in a use raising eyebrows, funding two golf course irrigation systems in Colorado Springs.
The federal help was unprecedented, massive and will continue to reshape the economy for years to come as the state and local governments work to spend another $5.8 billion in federal recovery funds.
An unexpected blow
State leaders scrimped and saved last decade, pulling together nearly $900 million in reserves to weather unexpected rough patches Colorado might face. When the pandemic hit in March 2020, they quickly realized it wouldn’t be enough.
“We were watching weekly and we burned through our 7.25% reserve (about $900 million) in 90 days. It was terrifying,” said Lauren Larson, director of the Governor’s Office of State Planning and Budgeting, recalling the early weeks of the COVID-19 pandemic.
Ski resorts, casinos, concert halls, nonessential retail stores and restaurants shut down. Employers sent workers home, emptying out downtown buildings and office parks. Collapsing oil prices put a stop to drilling. The state’s unemployment rate shot up from a very low 2.8% to a post-war high of 11.8% in just three months. Dislocated workers crushed the state’s overwhelmed and underfunded unemployment insurance system. By the end of the second quarter of 2020, Colorado’s GDP plunged an unprecedented 8%.
“The governor, in partnership with the legislature, made a real strategic allocation of those (reserve) funds and that really supported our businesses and our workforce; those were key decisions in the early days,” Larson said.
But by itself, state money represented a drop in the bucket. The federal government would need to step in, and it did. Abandoning the restraint shown in prior downturns, the Trump administration and Congress quickly assembled a $2 trillion package known as the Coronavirus Aid, Relief, and Economic Security Act in late March 2020.
The CARES Act is the largest federal aid package in U.S. history, and Congress passed other smaller funding measures until a year later, another $1.9 trillion was approved under American Rescue Plan Act or ARPA. In all, the federal government authorized $4.61 trillion in COVID-19 relief, obligated $4.15 trillion and spent $3.62 trillion, according to the website USASpending.gov.
The Denver Post examined the 22 largest government assistance programs during the pandemic, which provided $63.17 billion in aid to Colorado as of mid-January, according to a COVID-19 assistance tracker from the Peter G. Peterson Foundation.
The nonpartisan foundation focuses on federal spending and revenues, as well as debt levels. Peter G. Peterson, who made his money as a co-founder of The Blackstone Group, started it in 2008.
Diving into federal government databases, the Post assigned awards with an address to individual counties. In cases where the information was partial, distributions were extrapolated. And in cases where no address was available, but alternatives were, such as a county’s share of tax returns or unemployment claims, distributions were estimated. Read More...
