February 7, 2022
To: Municipal Clerks and Treasurers, County Clerks and Treasurers, and Heads of Government
Friendly reminders regarding American Rescue Plan Act – State and Local Fiscal Recovery Funds (ARPA-SLFRF)
Now that the U.S. Department of Treasury (Treasury) released the
Final Rule, local governments are able to decide on the use for their ARPA funds. While the Final Rule offers much greater flexibility for using funds with the new
$10 million threshold for revenue loss, we would like to offer a few reminders for consideration before making any final decisions.
- Take adequate time to carefully consider all alternatives for the prudent use of ARPA funding prior to committing the resources, to ensure the best use of the temporary funding
- Consider regional initiatives, including partnering with other ARPA recipients
- It is possible there are many beneficiaries of ARPA funding within your community, such as schools, transportation agencies and local economic development authorities
- Be sure to understand what they are planning and augment their efforts; alternatively, creating cooperative spending plans to enhance the structural financial condition of your community
- Investment in critical infrastructure is a particularly well-suited use of ARPA funds because it is a non-recurring expenditure that can be targeted to strategically important long-term assets that provide benefits over many years. However, care should be taken to assess any ongoing operating costs that may be associated with the project.
- Make sure to avoid creating new programs or add-ons to existing programs that require an ongoing financial commitment. It is important to remember that these funds are a one-time allocation distributed in two payments.
- Look for opportunities to leverage your ARPA funds with other state and federal programs. In addition to ARPA-SLFRF, the American Rescue Plan includes other sources of funding for state and local governments, including:
Remember – project planning costs are an eligible use of ARPA funds
The American Rescue Plan offers a rare opportunity to make strategic long-term investments in our communities. We encourage all local governments to use the funds wisely.