Federal watchdogs are asking lawmakers for help after Trump administration legal rulings appeared to sharply limit their ability to monitor more than $1 trillion in coronavirus relief programs — including huge payouts to protect businesses threatened by the pandemic.
In a two-page letter to several House and Senate committees last week, but disclosed for the first time on Monday, the inspectors general responsible for coronavirus relief oversight said an “ambiguity” in the main coronavirus response law — the CARES Act — allowed administration officials to sharply limit how much of the law’s spending requirements they must collect and report. This narrow interpretation of the law, the inspectors general warn, would dramatically impede their ability to gather information about some of the most expansive programs in the law, from the $670 billion Paycheck Protection Program to the $454 billion Treasury fund to protect businesses and industries damaged by the outbreak.
The legal opinions are the latest squeeze put on inspectors general by the Trump administration, which has gradually chipped away at the ability of internal watchdogs to monitor aspects of the administration’s conduct independently. The letter from the inspectors general, first revealed by The Washington Post, was signed by the Justice Department inspector general, Michael Horowitz, who leads a panel of inspectors general charged with coronavirus-related oversight known as the Pandemic Response Accountability Committee, and its executive director, Robert Westbrooks.
“We are writing to bring to your attention an issue that could impact the ability of the Pandemic Response Accountability Committee (PRAC) and federal Inspectors General to provide effective oversight of over $1 trillion in pandemic-related funds, as well as transparency to the public about how those monies are being spent,” Horowitz and Westbrooks wrote.
At issue is the structure of the CARES Act, which split its major programs between two “divisions” of the law. Division A included most of the major new relief programs like PPP, the economic stabilization program, as well as $150 billion in relief to states and local governments and $32 billion in support for aviation workers. Division B of the law authorized government-wide appropriations for federal agencies involved in coronavirus response. Administration lawyers, in a legal analysis provided to the Treasury inspector general, indicated that the reporting requirements in the law could be applied only to the appropriations contained in Division B.
“If this interpretation of the CARES Act were correct, it would raise questions about the PRAC’s authority to conduct oversight of Division A funds,” Horowitz and Westbrooks wrote. “This would present potentially significant transparency and oversight issues.”
Already, there’s bipartisan pushback on Capitol Hill about the administration’s interpretation of the law. Sen. Richard Shelby (R-Ala.), chairman of the Senate Appropriations Committee, has indicated he’ll support a legislative fix to address the transparency requirement.
“American taxpayers have a right to know how their money is being spent,” said a Shelby spokeswoman, Blair Taylor. “Neither the letter nor the spirit of the law limit the accountability committee’s purview in that regard.”
The chairwoman of the House Oversight Committtee, Rep. Carolyn Maloney (D-N.Y.), accused the administration of “manufacturing legal loopholes” to justify obfuscating independent oversight.
“Even under the Trump Administration’s flawed legal interpretation,” she said in a statement, “there is nothing preventing it from fulfilling its supposed commitment to cooperation and transparency by fully complying with all requests from Congress and independent oversight entities including Inspectors General, the Pandemic Response Accountability Committee, and the Government Accountability Office.”
A Treasury spokeswoman, Monica Crowley, said the administration was already submitting to “comprehensive oversight” by inspectors general, the Covid-19 Congressional Oversight Commission — whose chair has yet to be named by Speaker Nancy Pelosi and Senate Majority Leader Mitch McConnell — and the Government Accountability Office.
“The Pandemic Response Accountability Committee’s scope under the CARES Act covers other programs that are not already reviewed by these overlapping bodies,” Crowley said. “Further duplication of these oversight functions by PRAC would not increase transparency or oversight.”
In a May interim review of coronavirus spending, the Treasury inspector general faulted this interpretation of the law but described the dispute as an understandable ambiguity.
“Reasonable minds could differ on Agency Counsel’s legal analysis,” wrote Deborah Harker, the assistant Treasury inspector general for audit.