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To support the immediate pandemic response, bring back jobs, and lay the groundwork for a strong and equitable recovery, the American Rescue Plan Act of 2021 (ARPA) established the Coronavirus State and Local Fiscal Recovery Funds, designed to deliver $350 billion to state, local, territorial, and Tribal governments to bolster their response to the COVID-19 emergency and its economic impacts. According to this United States Treasury report, the Lehigh Valley is slated to receive just over $1.12 million in relief. If you are part of a local municipality, what type of relief should you expect from ARPA?
State, local, territorial, and Tribal governments have been on the frontlines of responding to the immense public health and economic needs created by COVID-19. Government bodies have played a paramount role in establishing vaccination sites and supporting small businesses. Despite their best efforts, governments have suffered internal revenue shortfalls during the downturn. Government bodies have been forced to make untenable choices between laying off educators, firefighters, frontline workers, and failing to provide routine services that communities rely on. Over 1 million jobs have been cut in local government since the start of this crisis, an astounding figure.
The U.S. Treasury is launching this relief in an effort to:
How to request funding
As of May 10, 2021, eligible state, territorial, metropolitan city, county, and Tribal governments may begin requesting their allocation of Coronavirus State and Local Fiscal Recovery Funds through the Treasury Submission Portal. It is important to note that state governments that make a request for their own funds will be considered by the Treasury to have requested funding for their non-entitlement units, which include local municipalities, as well. The Treasury will disburse payments for non-entitlement unit allocations to states following the release of further guidance on distributions to non-entitlement units. Following receipt of this funding from the Treasury, each state is required to distribute these funds to its non-entitlement units within 30 days unless granted an extension by Treasury.
Local governments will receive funds in two tranches, with 50% coming in May 2021 and the balance being delivered approximately 12 months later. States that have experienced a net increase in the unemployment rate of more than two percentage points from February 2020 will receive their full allocation of funds in a single payment.
To complete a submission on behalf of your jurisdiction, the following information must be provided:
Jurisdictions MUST submit a request to receive funding regardless of their previous applications for programs through the Treasury Submission Portal.
Keep in mind, only eligible state, territorial, metropolitan city, county, or Tribal governments can receive funding directly from the Treasury. At this time, non-entitlement units should not request funds through the portal. Non-entitlement units, defined in Section 603(g)(5) of the Social Security Act, are generally governments with populations of less than 50,000. Units falling into this category will receive their funds through their state governments. If you are classified as a non-entitlement unit, you are required to have a valid DUNS number to comply with the reporting requirements.
To find out how much funding your unit is entitled to, you can visit the Treasury website.
Use of funding
State and local governments have broad flexibility to allocate the funds to best meet the needs of their community. Recipients may use the funds to:
The Treasury’s Interim Final Rule provides detailed guidelines and principles for determining the types of programs and services that each category of funding can support, together with examples of allowable uses that recipients may consider.
If you are a local municipality with questions about ARPA funding relief, please reach out to our Municipal team.
Jacob Oldaker and Jack Gross practice Municipal law, providing counsel to local townships and counties for a wide array of legal matters.