U.S. Department of Treasury Coronavirus State and Local Fiscal Recovery Funds Interim Final Rule
The U.S. Department of the Treasury announced the launch of the Coronavirus State and Local Fiscal Recovery Funds, established by the American Rescue Plan Act of 2021, to provide $350 billion in emergency funding for eligible state, local, territorial, and Tribal governments.
Treasury released details on how these funds can be used to respond to acute pandemic response needs, fill revenue shortfalls (NLC Revenue Loss Calculator) and support the communities and populations hardest-hit by the COVID-19 crisis. With the launch of the Coronavirus State and Local Fiscal Recovery Funds, eligible jurisdictions will be able to access this funding in the coming days to address these needs.
Also, Treasury is now accepting requests for Coronavirus State and Local Fiscal Recovery Funds for entitlement (metropolitan) local governments. Local governments designated as non-entitlement units will receive this funding from their applicable state government, not though Treasury.
For non-entitlement communities, please visit the Pennsylvania Department of Community and Economic Development’s website to apply for funds through the Commonwealth. Allocation amounts for each non-entitlement community can be found here. You can also view Treasury’s FAQs for non-entitlement communities and visit this Treasury webpage to review further guidance for obtaining funding.
- U.S. Department of Treasury Coronavirus State and Local Fiscal Recovery Funds Website
- PA Department of Community and Economic Development Funding Application Portal for Non-Entitlement Communities
- U.S. Department of Treasury Coronavirus State and Local Fiscal Recovery Funds Treasury Submission Portal for Entitlement Local Governments
- U.S. Department of Treasury Coronavirus State and Local Fiscal Recovery Funds Guidance for Non-Entitlement Communities
- U.S. Department of Treasury FAQs for Non-Entitlement Communities
- U.S. Department of Treasury Coronavirus State and Local Fiscal Recovery Funds Interim Final Rule
- U.S. Department of Treasury Coronavirus State and Local Fiscal Recovery Funds Fact Sheet
- U.S. Department of Treasury Coronavirus State and Local Fiscal Recovery Funds Frequently Asked Questions
Initial U.S. Department of Treasury Guidance
April 15, 2021
The U.S. Department of Treasury has released its initial guidance advising both entitlement and non-entitlement communities to begin preparing certain information in order to receive funding from the Coronavirus State and Local Fiscal Recovery Fund. Treasury is still working on developing further guidance to implement the rest of the American Rescue Plan and will update their webpage as they release more information.
Please visit the Treasury’s website and take action now in preparation to receive funding through the American Rescue Plan.
The National League of Cities also published a blog post of What Small Cities Need To Know to Access ARPA Local Relief Funds on their CitiesSpeak website.
Advocacy and the American Rescue Plan Act
March 11, 2021
Over the last year, The League has worked in partnership with the National League of Cities (NLC) and our members to advocate for flexible and direct federal funding for local governments. The League, along with NLC, worked diligently to advocate to Congress on our members’ behalf through letters, press releases and meetings, in addition to engaging members in our advocacy efforts through press conferences and take action alerts.
President Joe Biden signed The American Rescue Plan into law on March 11, ensuring direct funding for local governments. Thanks to our collective efforts, Pennsylvania will receive roughly $13 billion dollars, close to $8 billion of which will go directly to our local governments to help recover from the pandemic.
Under the American Rescue Plan, local governments are directly allocated $65.1 billion out of the total $350 designated for states, local and tribal governments. Of this direct funding, about $45.5 billion will go to CDBG entitlement communities and about $19.5 billion will go to non-entitlement communities. For non-entitlement municipalities with a population less than 50,000, allocation will be capped at 75 percent of the municipality’s most recent pre-pandemic budget. Additionally, the grants will be allocated in two separate tranches, and you would not need to spend the entire amount of the first tranche in order to receive the second tranche. The grant funds must be used by December 31, 2024, as all money not spent will be returned to the U.S. Department of Treasury.
The U.S. Department of Treasury has 60 days to develop the regulations regarding the grants, including eligible uses of the funds, providing definitions and generally clarifying language in the American Rescue Plan. Additionally, Treasury will come out with the final list of grant allocations, so it is possible the current grant estimate for your municipality may change as Treasury is the ultimate arbiter for the amount each local government will receive. While we wait for more guidance and information from Treasury, there are a few things we do know: municipalities may use grant funds for revenue replacement; grant funds may be transferred to private non-profits, public benefit corporations involved in transportation of passengers and cargo, and special purpose units of state and local governments; grant funds cannot be used for pensions; and grant funds will be no more restrictive than the CARES Act Coronavirus Relief Fund.
We ask that you please be patient while we wait for Treasury to release their regulations, and we encourage you to visit the resources provided on this webpage.
We will continue to work with NLC and our Congressional delegation to provide information to all of you as it becomes available.