The American Rescue Plan Act of 2021, also called the COVID-19 Stimulus Package, American Rescue Plan, ARP or ARPA, is a $1.9 trillion economic stimulus bill passed by the 117th United States Congress and signed into law by President Joe Biden on March 11, 2021, to speed up the United Statesâ€™ recovery from the economic and health effects of the COVID-19 pandemic and the ongoing recession.
The Final Rule on ARP/CSLFRF Funds
On Jan. 6, 2022, the U.S. Department of Treasury issued the Final Rule for the ARP State and Local Fiscal Recovery Funds (CSLFRF) program which delivers $350 billion to state, local, and Tribal governments to support COVID-19 response and recovery. The move made several significant changes to the Interim Final Rule that was issued May 10, 2021. Among these was an expansion of local government authority to spend ARP/CSLFRF funds for general government expenses.
The Final Rule, which goes into effect April 1, 2022, offers a standard allowance for revenue loss of $10 million, allowing recipients to select between a standard amount of revenue loss or complete a full revenue loss calculation. Recipients that select the standard allowance may use that amount â€” in many cases their full award â€” for government services, with streamlined reporting requirements.
In plain terms, what this means is that many governing bodies will now have the flexibility to use all of their ARP/CSLFRF funds for general government services.
The UNC School of Government Coatesâ€™ Canons NC Local Government Law blog has provided a detailed breakdown of this change, the options and requirements tied to it, and other matters pertaining to using ARP/CSLFRF monies for revenue replacement for lost revenue growth. That post is available here.
A summary of the Final Rule is available here. The full text is available here.
Keep an eye on this space for more info on the Final Rule and ARP in our region.
A deep dive into EDA ARP funding opportunities
The Foothills Regional Commission, in partnership with the Economic Development Administration (EDA), the Centralina Regional Council, and the Western Piedmont Council of Governments, co-hosted a virtual meeting Aug. 9 to discuss the new EDA ARP funding opportunities and how we can champion local projects.
If you missed the live event, you can catch up on the presentation here.
NCLM’s American Rescue Plan Funding at a Glance and Guidance
The North Carolina League of Municipalities has released a guide that provides information on American Rescue Plan funding at a glance as well as guidance on utilizing these appropriations.
You can find this resource here.
NC Pandemic Recovery Office (NCPRO) Updates: New Guidance, Governorâ€™s Budget Information, Pre-Contracting Checklist, and 75% Cap Requirement
The NC Pandemic Recover Office (NCPRO website) has updated guidance on the US Treasury Interim Final Rule and affiliated FAQ, as well as an overview of Governor Cooperâ€™s ARP Budget Recommendations.
In order for non-entitlement communities to receive their appropriate ARP funding through the State, they must complete a Pre-Contracting Checklist, and submit it to NCPRO.
According to guidance from the US Treasury, each non-entitlement unit of government (NEU)â€™s total award (the total of distribution of under both the First and Second Tranche) is capped at 75% of its total annual operating budget (including general fund and other funds) as of January 27th, 2020.
It is important for all communities to submit a Pre-Contracting Checklist to the NCPRO office to determine whether this 75% cap applies to their community.
State and Local Fiscal Recovery Fund
The American Rescue Plan provides $350 billion dollars in emergency funding for state, local, territorial, and Tribal governments to remedy the mismatch between rising costs and falling revenues. This includes:
- $195 billion for states, (a minimum of $500 million for each State);
- $130 billion for local governments (a minimum of $1.25 billion per state is provided by the statute inclusive of the amounts allocated to local governments within the state);
- $20 billion for tribal governments; and
- $4.5 billion for territories
The Rescue Plan will provide needed relief to state, local, and Tribal governments to enable them to continue to support the public health response and lay the foundation for a strong and equitable economic recovery.
In addition to helping these governments address the revenue losses they have experienced as a result of the crisis, it will help them cover the costs incurred due responding to the public health emergency and provide support for recovery â€“ including through assistance to households, small businesses, and nonprofits, aid to impacted industries, and support for essential workers. It will also provide resources for state, local, and Tribal governments to invest in infrastructure, including water, sewer, and broadband services.
Isothermal Region will Receive $65.5 Million in Direct Funding
Key Categories of Eligible Funding Use
- Coronavirus Response & Relief â€“ These funds are like and no more restrictive than previous appropriations provided through the CARES Act.
- Higher Wages for Public Employees â€“ Up to $13 per hour above regular wages
- Replacement Revenue â€“ Cities and towns can make up for lost revenue due to the COVID-19 emergency.
- Investments in Water, Sewer and Broadband Infrastructure â€“ More guidance is coming from the Treasury
Resources from Local and National Partners
- NC League of Municipalities: NC & the American Rescue Plan Hub and American Rescue Plan Primer for Municipal Officials
- National Association of Counties: Local Funding Allocations and Letter to Treasury on Fund Implementation and Clarification
- National Association of Regional Councils: Analysis of the American Rescue Plan
- Resource: ARP state and local funds Fact Sheet
- Blog: When states and local governments can expect to receive funds
- Blog: Everything you need to know about the ARC
How Can Foothills Regional Commission Help?
FRC can help our member organizations plan, administer, and document the funds theyâ€™ll receive from the American Rescue Planâ€™s State and Local Fiscal Recovery Fund. Contact Karyl Fuller, director of Community & Economic Development, at [email protected] to discuss how FRC can help you and your organization.