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Mnuchin to put $455B in COVID-19 relief funds beyond successor's reach

Treasury Secretary Steven MnuchinSteven MnuchinOn The Money: Senate confirms Yellen as first female Treasury secretary | Biden says he's open to tighter income limits for stimulus checks | Administration will look to expedite getting Tubman on bill Senate confirms Yellen as first female Treasury secretary Biden administration will look to expedite getting Tubman on bill MORE signaled that he will move $455 billion in COVID-19 relief from the Federal Reserve back into the Treasury’s General Fund, a move that would make it harder for his successor to access the emergency funding.

Mnuchin said last week that he was shuttering a handful of the Fed's emergency lending facilities, a move the central bank opposed in a rare critical statement. Those facilities, though little used during the pandemic, were seen as confidence boosters for capital markets.

The amount to be returned by Mnuchin was part of a $500 billion allocation in the $2.2 trillion CARES Act that President TrumpDonald TrumpSchumer: Impeachment trial will be quick, doesn't need a lot of witnesses Nurse to be tapped by Biden as acting surgeon general: report Schumer calls for Biden to declare climate emergency MORE signed into law in late March.

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Mnuchin at the time requested the Fed return the funding, which Congress appropriated to cover potential pandemic-related losses, saying the CARES Act set a legal deadline for the facilities to expire by year’s end.

Putting the cash back into the general fund would make it harder for former Fed chair Janet YellenJanet Louise YellenOn The Money: Senate confirms Yellen as first female Treasury secretary | Biden says he's open to tighter income limits for stimulus checks | Administration will look to expedite getting Tubman on bill Senate confirms Yellen as first female Treasury secretary Sorry Mr. Jackson, Tubman on the is real MORE, President-elect Joe BidenJoe BidenBudowsky: A Biden-McConnell state of emergency summit DC might win US House vote if it tries Inaugural poet Amanda Gorman inks deal with IMG Models MORE's reported pick to lead the Treasury Department next year, to deploy the funds, and may require another act of Congress to do so.

Bharat Ramamurti, a former adviser to Sen. Elizabeth WarrenElizabeth WarrenTim Ryan says he's 'looking seriously' at running for Portman's Senate seat Leahy, not Roberts, to preside over impeachment trial Skepticism reigns as Biden, McConnell begin new era MORE (D-Mass.) who now serves as a member of the congressional committee appointed to oversee the funds, called Mnuchin's move “illegal.”

“This is Treasury’s latest ham-handed effort to undermine the Biden Administration,” he said on Twitter.

Neither the Treasury Department nor the Biden transition team immediately responded to a request for comment.

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Republicans on the Senate Banking Committee applauded Mnuchin, saying he was faithfully following the intent and letter of the law.

“Congress’s intent was clear: these facilities were to be temporary, to provide liquidity, and to cease operations no later than the end of 2020,” GOP lawmakers said in a letter spearheaded Committee Chairman Mike CrapoMichael (Mike) Dean CrapoOVERNIGHT ENERGY: Biden's Interior Department temporarily blocks new drilling on public lands | Group of GOP senators seeks to block Biden moves on Paris, Keystone | Judge grants preliminary approval for 0M Flint water crisis settlement Sweeping COVID-19, spending deal hits speed bumps McConnell in tough position as House eyes earmark return MORE (Idaho) and Sen. Pat ToomeyPatrick (Pat) Joseph ToomeyGovernment used Patriot Act to gather website visitor logs in 2019 Appeals court rules NSA's bulk phone data collection illegal Dunford withdraws from consideration to chair coronavirus oversight panel MORE (Pa.).

“With liquidity restored, we strongly support Treasury Secretary Mnuchin’s decision to close these facilities by year-end, as Congress intended and the law requires, and the Federal Reserve’s decision to return unused CARES Act funds to Treasury,” they added.

The GOP senators said Congress could take action to “revive” the facilities if the need arose. But Congress has struggled to pass extensions for key provisions of the CARES Act that expired July 31, and congressional leaders have remained deadlocked over a new coronavirus relief bill for months.

Updated at 3:42 p.m.