SAN FRANCISCO (KPIX) – There are a lot of questions surrounding Governor Gavin Newsom’s threat to withhold federal emergency funding from counties that aren’t abiding by the state stay at home order.

Many are wondering if the governor has the authority to withhold that money, what that could mean for local counties, and if the state will actually follow through with the threats.

The health departments for Sutter, Yuba and Modoc counties have all relaxed restrictions beyond the Gov. Newsom’s statewide stay-at-home order because of a relatively low number of COVID-19 cases.

On Monday, the governor alluded to new guidelines that could make the relaxed county orders legal, but in the meantime, there are a lot of questions.

Gov. Newsom sidestepped questions about his authority to withhold federal disaster funding from counties that defy his order.

This comes after his Office of Emergency Services sent a letter to Sutter, Yuba and Modoc counties Thursday, threatening to withhold federal disaster funding if the counties continued to defy his order. The letter stated if the county “believes there is no emergency” and ignores the governor’s order, they would not be able to demonstrate that “they were disproportionally impacted by COVID-19.”

The counties have relaxed restrictions, allowing businesses that are not part of the governor’s phase 2 plan to reopen, and allowing dine-in customers at restaurants.

Some business owners like Sandy Drown say they needed to reopen to survive, which is why the Yuba City mayor stands behind Sutter County’s decision.

“When you weigh that with the lost revenue and impact to our businesses, not only that but the mental health of our residents,” Mayor Shon Harris said.

He says it’s also a matter of tax revenue versus the potential loss in federal emergency reimbursements.

While the counties couldn’t say how much they stand to lose overall, Harris says Yuba City could lose anywhere from $14,000 to $40,000 in federal reimbursements.

“Fourteen thousand to forty-thousand dollars, in the bigger picture, when you factor in the lost sales tax, is not very significant,” Harris said.

And it appears it may not ever come to that. On Monday, the governor alluded to hope for Yuba and Sutter counties.

“We’re having some very good conversations and those examples you used are sort of proof points of confidence that I have that we’ll be able to work through a lot of the differences we have,” Newsom said.

Under the Federal Disaster Declaration, it is the state that grants county reimbursements for emergency funds.

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