Agenda - Council - 09/13/2022 - Laserfiche WebLink

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Courts have recognized that the phrase "due to" can refer to various causal standards.295 Here, in the context of Congress's addressing economic disruptions caused by the COVID-19 pandemic that could impact both revenues and government services, the key consideration is whether a revenue loss experienced by the recipient resulted from the exogenous impacts of the public health emergency (and were thus "due to" the pandemic) or instead from the recipient's own discretionary actions (and, in this context, were not "due to" the pandemic). Reductions in revenue due to the public health emergency does not cover revenue reductions that resulted from a recipient's own discretionary actions. In the interim final rule, Treasury included a presumption that all revenue loss is due to the pandemic in order to minimize the administrative burden on recipients discussed above and take into consideration the devastating effects of the COVID-19 public health emergency. Based on comments, Treasury believes that the reasons for the presumption continue to be valid and has determined to maintain the presumption in the final rule with certain modifications. In particular, at this point in the course of the pandemic, with the fiscal pressure on state and local governments having been significantly reduced, it is appropriate for Treasury to reassess aspects of this presumption. As discussed below, the final rule requires recipients to exclude the value of tax policy changes adopted after January 6, 2022. Recipients of the SLFRF range from states to the smallest local governments. At the time that the interim final rule was adopted, it was important for recipients to be able to calculate with ease and certainty their amount of revenue loss so that they could begin deploying these funds to continue to maintain essential government services. To this end, the presumption in the interim final rule provided a relatively simple formula for all recipients to use, but the exigent need for 295 U.S. Postal Service v. Postal Regulatory Comm'n, 640 F.3d 1263 (D.C. Cir. 2011); see Kimber v. Thiokol Corp., 196 F.3d 1092, 1100 (loth Cir. 1999); Adams v. Director, OWCP, 886 F.2d 818, 821 (6th Cir. 1989). 252