Biden plan gives states money, but ties their hands By Jim Stergios - Contributing columnist For state governments, the good news is that the American Rescue Plan recently signed by President Joe Biden will inject $350 billion into their budgets. The bad news is that it places unwise and possibly unconstitutional limitations on how states can use the money. According to the Rescue Plan, as part of a new law or regulation, states and territories “shall not use the [federal] funds to either directly or indirectly offset a reduction in the net tax revenue.” In other words, if states want the money, they can’t pass tax cuts.