On Tuesday, March 25 the U.S. Department of the Treasury sent out a notice to recipients of State and Local Fiscal Recovery Funds (SLFRF) from the American Rescue Plan Act (ARPA) informing them of their reporting requirements, obligation deadline, and repayment process.
Treasury’s notice contained timely and important information for all cities who received ARPA-SLFRF funds. If you did not receive the notice from Treasury, it can be accessed here.
Here are some key points from the notice:
The obligation deadline for ARPA-SLFRF funds was December 31, 2024; however, the reporting deadline for your obligations depends on your city’s reporting schedule.
In the notice from Treasury, it states:
Many recipients have now provided reports covering obligations through the December 31, 2024, obligation deadline, while others soon will. Quarterly reporters were required to submit their latest report to Treasury by January 31, 2025, covering obligations through the obligation deadline. Annual reporters will submit their next report to Treasury between April 1 and April 30, 2025, covering obligations through the obligation deadline.
Cities in Washington that received less than $10 million in ARPA-SLFRF funds are required to submit annual reports each April. These reports cover their obligation and expenditure activity between April 1 of the previous year and March 30 of the current year. For example, the report due in April 2025 will cover activity that occurred between April 1, 2024, and March 30, 2025. This year’s report will cover the obligation deadline of December 31, 2024.
Cities that received more than $10 million are required to submit quarterly reports to Treasury. The most recent report was due January 31, 2025, and covered obligation and expenditure activity that occurred between October 1, 2024, and December 31, 2024. The January report covered the obligation deadline of December 31, 2024.
If your city submits annual ARPA reports, be ready to report on your obligations in April 2025.
The first major deadline for ARPA funds was December 31, 2024. At that time, cities were required to properly obligate their funds according to Treasury’s guidance. The report due in April 2025 will be the opportunity for cities to report on those obligations to Treasury. Funds not reported as obligated in the April 2025 report will need to be returned to Treasury.
You can read more on the obligation deadline from an AWC article published in August 2024.
Make sure your project and program descriptions accurately describe how your community used ARPA funds.
In the notice sent by Treasury, it states:
Treasury intends to vigorously monitor recipients’ methods of obligating funds... Treasury is committed to recouping funds that recipients obligated or expended impermissibly, as well as to recapturing funds that they did not obligate by the deadline.
As your city completes the April 2025 report, take the time to review each project to ensure that you clearly state how funds were used. In the notice, Treasury indicates that they will follow up with ARPA-SLFRF recipients if there are concerns about a reported project.
If your city failed to meet the obligation deadline, start planning now to return the federal funds to Treasury.
This notice marks the first time Treasury has indicated how they will claw back ARPA-SLFRF funds from cities.
If your city missed the obligation deadline or if a project or program is deemed ineligible, Treasury will send out notices on the amount that must be returned, as well as the deadline when the funds must be returned.
Treasury will be using Pay.gov to provide repayment options to cities. Treasury clearly states in the notice that they will follow standard debt collection procedures if a city fails to return funds.
There are resources available if you have questions.
NLC and Treasury both have resources available to help you as you navigate submitting your April 2025 ARPA-SLFRF report.
Treasury:
NLC:
If you have questions or concerns, please contact Jacob Ewing at jacobe@awcnet.org