A state lawsuit filed last week challenges the way North Carolina is handing out $335 COVID-19 relief checks intended to help households with school-aged children. The suit says the checks won't go to low-income households that need them most.
About 1 million families are expected to receive the so-called Extra Credit Grants to help cover costs of remote learning and child care during the pandemic. The state legislature in September approved spending about $440 million in federal CARES act funds on the program.
Middle- and high-income families that paid state taxes last year will automatically get checks through the state Department of Revenue. They include households making as much as $400,000 a year.
But the lawsuit says as many as 200,000 more families or caregivers with low incomes won't get the checks next month. That's because they didn't make enough money to file tax returns and won't get checks automatically. In addition, they may not have heard about the grants in time to file applications by the Oct. 15 deadline.
Ken Schorr, executive director of the Charlotte Center for Legal Advocacy, said Monday it makes no sense for the state to give checks to middle- and high-income families and not to those with the lowest incomes.
"The people who need the money the most are the lower-income families who are struggling," Schorr said. "They can't afford childcare, they may not have adequate Wi-Fi in their houses, they may not have good home computers, they have other expenses."
The Charlotte Center for Legal Advocacy, Legal Aid of North Carolina and three parents filed the suit last week at Wake County Superior Court. It names the N.C. Department of Revenue and secretary Ronald Penny as defendants.
The suit argues that the procedure is unconstitutional because it discriminates against low-income people, Schorr said.
"The complaint is not that the Department of Revenue isn't managing the program right. They're doing it the way the legislature structured it," Schorr said. "But it was structured in a way that just isn't fair to low-income people. And we think that is unconstitutional."
The suit asks the court to order state officials to come up with a plan to make sure all families have access to the grants.
Schorr Johnson, a spokesman for the N.C. Department of Revenue, said the department does not comment on pending lawsuits. But he added in an email that the department did run a campaign to publicize the deadline: "In order to increase awareness of the application deadline during the tight turnaround time set forth in the statute, the Department placed statewide radio advertising, newspaper advertising in African American and Spanish-language newspapers, and digital billboards in the state’s metro areas. The Department also engaged in robust stakeholder outreach to make eligible individuals aware of the program and the application process."
A spokeswoman for Attorney General Josh Stein also declined to comment.
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