Treasury Department warns Arizona governor over using federal Covid funds for anti-mask school programs

By Liz Stark, CNN

The Treasury Department sent a warning to Arizona’s Republican governor Tuesday about the state’s use of federal Covid-19 relief funds for grant programs that circumvent school mask requirements.

Gov. Doug Ducey announced over the summer that Arizona would use the federal money to increase the funding available to public school districts only if they’re open for in-person learning and don’t require children to wear masks.

To be eligible for that grant funding — totaling $163 million — Arizona school districts must have opened for in-person learning as of August 27 and must be “following all state laws,” including the ban on school mask mandates that Ducey signed into law in June. A separate grant program provides money for students who attend schools that require masks, allowing them to use it for education expenses like transportation and tuition costs at a different school.

In a letter to Ducey on Tuesday, Deputy Treasury Secretary Adewale Adeyemo expressed concern over the creation of those two programs, which are funded with relief dollars from the American Rescue Plan.

“We are concerned that two recently created Arizona grant programs undermine evidence-based efforts to stop the spread of COVID-19,” wrote Adeyemo.

CNN has reached out to the Arizona governor’s office for comment.

This warning comes as Ducey has made efforts to prohibit mask mandates in schools, even as public health experts have promoted masks as an important mitigation measure amid the pandemic.

As CNN previously reported, a state ban on mask mandates in public and charter schools was scheduled to become a law, but a Maricopa County judge ruled the ban unconstitutional last week. Ducey called the move “an example of judicial overreach” and pledged to challenge the ruling.

In Tuesday’s letter, Adeyemo notes that the purpose of the state and local recovery funds is to “mitigate the fiscal effects stemming from the COVID-19 public health emergency, including by supporting efforts to stop the spread of the virus.”

“A program or service that imposes conditions on participation or acceptance of the service that would undermine efforts to stop the spread of COVID-19 or discourage compliance with evidence-based solutions for stopping the spread of COVID-19 is not a permissible use” of those funds, the treasury official added.

Arizona has 30 business days to respond to the letter with information about how it will “remediate the issues identified with the two programs,” Adeyemo said, adding that failure to respond or resolve the issues could result in potentially losing the funds.

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CNN’s Paul LeBlanc contributed to this report.