Gov. Wolf, county commissioners announce settlement of CARES Act suit

4 min read4,824 views and 1,164 shares Posted August 14, 2020

In a press release issued Friday afternoon, August 14, Lebanon County Chief Clerk and Administrator Jamie Wolgemuth announced that the lawsuit filed by the county against Gov. Tom Wolf on July 22 for release of $12.8 million dollars of COVID-19 relief money has been settled.

Read More: Lebanon County files lawsuit over Gov. Tom Wolf withholding millions in coronavirus relief funding

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Background
The CARES Act, or Coronavirus Aid, Relief, and Economic Security Act, is a $2 trillion federal economic relief package in response to the COVID-19 pandemic. $150 billion of this money is dedicated to the Coronavirus Relief Fund, which provides payments to state, local and tribal governments.

The state of Pennsylvania received $625 million of these funds to distribute to 60 counties in the state, but Gov. Wolf decided to withhold the $12.8 million allocated for Lebanon County.

This decision came after several Lebanon County elected officials made the decision to prematurely move the county to the “yellow” phase of reopening, in opposition to the governor’s shutdown order.

Other counties, including Berks, Cumberland, Dauphin, Franklin and Schuylkill, made similar declarations but Lebanon County was the only one to follow through with early reopening. Lebanon County is also the only county Wolf had withheld CARES Act funds from.

According to Wolgemuth, the county will receive all of the $12.8 million, without interest, and it will be disbursed as follows:

  • $1,000,000 for municipal governments and school districts for expenses and reimbursement of COVID-related costs
  • $3,000,000 for small business grants and personal protective equipment (PPE) distribution (under 100 employees)
  • $2,250,000 for grants and PPE to tourism-related business and the county fair
  • $2,000,000 for grants and PPE to non-profit 501C(3) and 501C(19) organizations
  • $1,500,000 to the Lebanon Valley Economic Development Corporation, Forward Lebanon Promotions, and large businesses
  • $250,000 to behavioral health, substance abuse treatment, and suicide prevention treatment costs
  • $2,800,000 to fund a campaign to promote universal face mask wearing
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The Settlement Agreement spelling out the details of the deal was signed on behalf of the county by Commissioners Bob Phillips and Jo Ellen Litz, but not by Commissioner Bill Ames.

In addition to a common provision of settlements stating that neither side admits any wrongdoing, the county agreed that it will “forfeit” the funds it will be receiving, and any possible future CARES Act funds, if the county violates any part of the settlement.

The agreement also contains this provision:

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“All funds provided to the County under this Agreement must include a legal verification that all persons or entities receiving funds have and will comply with the Orders referenced above and has enforced those orders as to their owners, customers, or employees;”

That provision could block payments to two county businesses, Taste of Sicily Restaurant in Palmyra and Heisey’s Diner in Ebenezer, that openly conducted business in defiance of the governor’s COVID-19 health and safety orders.

Both were publicly supported in their defiance by Republican Commissioners Phillips and Ames, along with local Republican state Representatives Russ Diamond and Frank Ryan, and local state Senator Dave Arnold.

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It is expected that the county will be filing papers with the Commonwealth Court, notifying it of the settlement and officially ending the lawsuit.

No timeline for release of the money was given, but Wolgemuth said “[t]he County will be partnering with well-established local non-profits and business organizations to help administer the funds and allocate these dollars as soon as practical.”

“The Governor’s Office,” Wolgemuth noted, “working through the Department of Economic and Community Development, intends to quickly distribute these funds subject to the agreement of the parties, the CARES Act, and Act 24 of 2020.”

Wolgemuth concluded by saying “[t]he County Commissioners affirm their commitment to the best health and safety practices as advised by the CDC and Secretary of Health and to the Governor’s and Secretary’s COVID-19 mitigation orders and the Administration’s ‘Plan to Reopen Pennsylvania.’ The Commissioners urge all residents of Lebanon County to follow all of the Administration’s recommended practices to mitigate the impact of COVID 19 in our community.”

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In a separate press release announcing the settlement, Gov. Wolf said that he had remained committed to helping the people of Lebanon County and had found a solution to “directly inject” the nearly $13 million into the community.

“My hope is the money will help businesses to succeed and pay workers and allow important local organizations to provide vital services that people need,” said Wolf.”

Wolf also lauded the mask campaign, saying he was pleased to see Lebanon County launch the effort. “Mask-wearing is important to reduce the spread of COVID-19 to protect people, schools and businesses,” said Wolf. “It’s a simple and easy way for all of us to fight this virus and control case counts in Lebanon County and across the state.”

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In an email blast following the announcement, Lebanon Valley Chamber of Commerce President Karen Groh thanked Lebanon County and the governor’s office for their hard work in getting the agreement ratified.

“We are excited to be working with the county on the small business grant opportunities and will let our business community know when the process is approved and ready for applications,” said Groh in the message.

Lebanon County’s state legislators also reacted to news of the settlement.

The letter, signed by state Senator Dave Arnold (R-48) and state Representatives Frank Ryan (R-101), Russ Diamond (R-102), and Sue Helm (R-104), asserts that the signees believed the “unilateral restrictions” were illegal and needed to be challenged in court.

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“We wholeheartedly disagree with [the county commissioners’] decision to negotiate a settlement with the man who has stolen money owed to our county in order to fulfill a political vendetta.”

This article will be updated as we receive more information about the settlement agreement.


Read all of LebTown’s COVID-19 coverage here.

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Davis Shaver contributed reporting to this article.

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Full Disclosure: The campaigns of Bill Ames, Bob Phillips, and Jo Ellen Litz were advertisers on LebTown during previous election cycles. Ames Home Services and the Lebanon Valley Chamber of Commerce are current advertisers on LebTown. LebTown does not make editorial decisions based on advertising relationships and advertisers do not receive special editorial treatment. Learn more about advertising with LebTown here. Additionally, Lebanon County Solicitor David Warner has a financial interest in the ownership of LebTown’s parent company Lebanon Publishing Company. He has no involvement in editorial operations, including this article.

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