Throughout the past year, The Center for Community Solutions has written about the Coronavirus, Aid, Relief and Economic Security (CARES) Act, which was passed in March 2020 to aid the national response to the COVID-19 pandemic.
The American Rescue Plan Act (ARPA), passed in March 2021, was meant to be a supportive catalyst for America’s communities to recover from the impact of the pandemic. The ARPA, dedicated to creating a stronger economy post-pandemic, created the Coronavirus Local Fiscal Recovery Fund and the Coronavirus State Fiscal Recovery Fund. Together, they will dispense $350 billion in funding to states, counties and major cities across the United States. In Ohio, the state will receive roughly $5.37 billion, 88 counties will receive approximately a total of $2.27 billion and metropolitan cities will receive approximately $2.18 billion.
In this blog post, we will explore some of the high-level aspects of the legislation, as well as some of the important language that will shape the distribution of funds. Given that the Interim Final Rule from the United States Treasury is 151 pages long, the intent of this piece is to understand the spirit of the legislation, as well as discuss some of the specific uses for the dollars.
The dollars from the ARPA will reimburse public entities for approved costs, as well as make disbursements to community members and organizations. These dollars can be earmarked for costs incurred until December 31, 2024, and must be disbursed no later than December 31, 2026. Any funds not obligated by the end of 2024 must be returned to the federal government.
The ARPA funds will arrive in two installments. Cuyahoga County will receive approximately $120 million this May and $120 million in May 2022. According to Walter Parfejewiec, director of the Office of Budget Management, the county has created a separate fund that will specifically track how ARPA dollars are spent. This plan tracks closely with the county’s approach to how CARES Act dollars were spent. Below are the top 10 counties in Ohio according to the amounts each will receive.
According to the guidance issued by the United States Treasury, recipients may use payments from the recovery funds to replace state, local and travel (such as hospitality and tourism) government revenue loss due to COVID-19. However, they may also use these resources to lay a foundation for strong, equitable economic recovery by addressing systemic public health and economic challenges that have contributed to the pandemic’s severe impact on low-income communities and people of color.
The guidance goes over four main uses for ARPA dollars:
Responding to the public health emergency –– Includes COVID-19 response and prevention; COVID-19 testing and vaccination programs; COVID-19 expenses incurred by public hospitals, congregate living facilities, skilled nursing facilities, long-term care facilities, incarceration settings, homeless shelters, as well as expenses for ventilation improvements for congregate facilities (including nonprofits) and public health facilities. This also includes mental health treatment, substance misuse treatment, and other behavioral health services.
Providing premium pay to workers – Offers additional support for eligible government workers who did essential work during the COVID-19 public health emergency.
Providing government services — Through a government-provided formula, local governments are able to calculate how much revenue they generated this fiscal year, then governments compare that number to the previous fiscal year. They can then use that difference to calculate how much revenue was lost.
To make necessary Improvement in infrastructure — The funds can be used for improvements to provide clear drinking water, sewer upgrades, and expansion of broadband. If the funds are used for broadband improvements, the speeds must be a minimum of 100 megabits per second (mbps) for downloads and between 20 mbps and 100 mbps for uploads.
The guidance highlights the fact that COVID-19 disproportionately impacted certain communities. The guidance explains “low-income communities, people of color, and Tribal communities have faced higher rates of infection, hospitalization, and death.” Later in the document, it cites that the “labor force participation rate for Black women has fallen by 3.2 percentage points during the pandemic as compared to 1.0 percentage points for Black men, and 2.0 percentage points for White women.” Finally, the Interim Final Rule states that these resources are aimed at “addressing the systemic public health and economic challenges that may have contributed to more severe impacts of the pandemic among low-income communities and people of color.” Several times in the document, the United States Treasury encourages recipients to aid households, businesses, nonprofits and communities most impacted by the pandemic. Such supports include lead paint remediation, community violence intervention programs and housing programs that can provide affordable housing or combat homelessness.
Transparency and accountability
The guidance makes it clear that the legislation intends for governments to provide transparent spending of ARPA dollars. States and counties with populations over 250,000 will be mandated to provide an annual Recovery Plan Performance report to the Treasury and post it on a public-facing website. The plan must include performance indicators, as well as programmatic impact data. The language also encourages state and local governments to engage communities on how best to utilize dollars. Additionally, the guidance states that public bodies are to regularly create quarterly reports about the projects and expenditures. The reports from local governments will go directly to the United States Treasury, not to the state. In Ohio, the three cities that will receive the highest amounts are Cleveland ($511,721,590), Cincinnati ($279,590,123) and Columbus ($187,030,138).
Other Cities in Cuyahoga County that will receive ARPA funds
The ARPA offers an enormous infusion of dollars that can be catalytic to community change and improvement. Community Solutions will actively track the metrics that the City of Cleveland and Cuyahoga County use to measure impact of the ARPA dollars they receive in the months ahead.
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