The American Rescue Plan (ARP) provided $350 billion to state and local governments to deal with the effects of the pandemic. The specific requirements attached to the funding were left up to the Department of Treasury, which adopted an Interim Final Rule in May and took comments from the public through mid-July. The Treasury indicates it will continue reviewing those comments through the fall. Last week the department issued an “explainer” to update and remind everyone of the status and effect of that Interim Final Rule.
There are a few things to note in this document. First, the Interim Final Rule remains fully effective until a Final Rule is adopted – with no indication of exactly when that will be. The explainer cites a “non-exhaustive” list of examples of sanctioned uses. And it emphasizes, “Funds used in a manner consistent with the Interim Final Rule while the Interim Final Rule is effective will not be subject to recoupment.” And among the examples is this:
- “Assistance to small businesses facing negative economic impacts, including to address financial hardship; implement COVID–19 prevention or mitigation tactics; or provide technical assistance, counseling or other services to assist with business planning needs.”
Another potential use important to businesses is for water, sewer and broadband infrastructure. Investments in these things is included in a prior Treasury document that gave a broad outline of the allocation and uses of the funds by state and local governments:
The explainer also references Treasury responses to FAQs as guidance:
https://home.treasury.gov/system/files/136/SLFRPFAQ.pdf
State and local governments have been paying close attention, and obviously the details are of great significance to them. But everybody should be part of the input and encourage prudent usage of these funds. There are plenty of details to sort through. See the full text of the Interim Final Rule:
Resource: Bill Waltz at (317) 264-6887 or email: bwaltz@indianachamber.com
