U.S. Treasury Releases Final Rule on ARPA Coronavirus State and Local Fiscal Recovery Funds

Best Best & Krieger LLP

Final Rule, Considered Victory for Local Governments, Takes Effect in April 2022

The U.S. Department of Treasury has released the Final Rule governing implementation of the American Rescue Plan Act (ARPA) Coronavirus State and Local Fiscal Recovery Funds.

The Final Rule provides state and local governments with greater flexibility to address the COVID-19 public health emergency and support their communities. When it goes into effect in April 2022, the Final Rule will replace the Interim Final Rule issued by Treasury in May 2021.

Notable changes within the Final Rule include:

  • Replacing Lost Public Sector Revenue
    • The Final Rule provides public sector recipients with the option to either select a standard amount of $10 million in lost revenue or complete a full revenue loss calculation. Once a recipient makes the selection, it cannot be changed during the program. If the recipient chooses the standard amount, that does not increase or decrease the recipient’s allocation amount.
  • Public Health and Economic Impacts
    • The Final Rule clarifies the use of funds for programs and services to address public health and economic impacts, including the use of funds for capital expenditures to support an eligible COVID-19 public health or economic response.
  • Disproportionately Impacted Communities
    • The Final Rule expands the set of households and communities that are presumed to be “impacted” and “disproportionately impacted” by the pandemic. This expansion allows recipients to utilize funds in a broad manner without additional analysis for these households, communities and entities.
  • Premium Pay
    • The Final Rule broadens the “eligible workers” category and therefore affords premium pay without written justification, while also maintaining a focus on lower-income and frontline workers.
  • Water, Sewer and Broadband Infrastructure
    • The Final Rule adds new categories of eligible uses for water and sewer investments, including lead remediation, stormwater infrastructure, and aid for private wells and septic units. Further, it significantly expands the eligibility of uses for broadband infrastructure, including investment to address access, affordability and reliability.

BB&K’s extensive work on behalf of municipalities nationwide provided firm attorneys with numerous opportunities to successfully advocate for key Final Rule changes, particularly in the broadband realm. Learn more here.

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DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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