$1.1 billion – a huge and historic number for cities in Washington. Last year, we were thrilled that cities were allocated $187 million of the state’s share of the CARES Act; however, the American Rescue Plan (ARP) Act is a whole new level
of federal funding.
With such large sums of federal funds flowing into our cities in the coming months, we must take a moment to consider the good, better, and best way of using the funds to support city operations, community members, and local businesses. Here are five
tips to keep in mind as you plan how to spend your ARP allocation.
- There are still more questions than answers. It’s been over two weeks since the ARP was signed into law. The Treasury Department has been tasked with writing up guidelines for how cities, counties, and states can use their allocations.
The Treasury Department has until early May to put the guidelines together. We expect they will use most of that time developing the guidelines to ensure they cover all the questions and concerns local governments have about the federal funds.
AWC, NLC, and the state are collecting and submitting questions to the Treasury. In a recent call with NLC staff, they estimated that they have sent over 1,000 questions to Treasury regarding ARP funding. At AWC, we have received dozens
of questions from cities. We continue to document your questions and will release an FAQ as soon as we have answers.
If you have questions about the ARP, please contact Peter King or Jacob Ewing.
- Check before committing funds to programs that are also receiving federal aid. The ARP is a $1.9 trillion relief package. It includes funds for counties, tribes, states, businesses, school districts, rental assistance, broadband,
utilities, public health, and so much more. Before committing to funding any local programs, make sure to verify if there are available federal dollars specifically for those programs. Remember, once you’ve spent your city’s allocation,
that money is gone. For a holistic view of the act, take a look at this breakdown from the Senate Democrats.
- You don’t need to spend all the money right now. Unlike the CARES Act that had a very tight deadline, the ARP allows cities to spend funds until the end of 2024. While the money is coming in two tranches over the next year,
you are not required to spend either tranche right away. You should take time to collect community and staff input on how funds should be spent, consider what needs should be addressed right away and which needs can be addressed in the coming
few years. Again, they are one-time federal dollars, and once they are spent, they are spent.
- Document, document, document. The ARP Act includes a reporting requirement for all jurisdictions that receive federal funds. It is not entirely clear if it will be a direct reporting requirement or if the federal government will conduct
random audits over the coming years. No matter how the federal government decides to accomplish the requirement, it is critical that cities document both how and why money is being spent in their community.
Additionally, community members
and the media will be keen to know how the federal dollars are spent. Having a well-documented process in place will help promote transparency within your community as well as avoid any potentially negative press.
- Communicate with your federal representatives. Support for the ARP Act was highly partisan. Whether or not your federal representatives voted to support the ARP, it is still important to keep them informed about how your city is using
the funds. Consider inviting them to a ribbon-cutting ceremony for a local business re-opening after the pandemic. Send them a video of a local nonprofit helping a family move into a home. Invite them to an open house discussing local infrastructure
improvements funded through the ARP. Showing our federal elected officials that cities are good stewards of federal funds will help win future federal support if cities ever need direct federal dollars again.
We look forward to these critical funds arriving in Washington and seeing how our 281 cities use them to support their local communities.