Local Leaders Need to Know: $360 Billion in State and Local Relief Is Coming to Every American Community

Almost exactly one year into the COVID-19 pandemic, a massive relief plan has passed both chambers of Congress and been signed into law by President Biden. The $1.9 trillion American Rescue Plan Act (ARPA) is an historic achievement that will provide unprecedented resources to combat the health, economic, and racial equity challenges that have been caused, exposed, and exacerbated by the coronavirus.

While the above relief programs have understandably captured most of the headlines, another massive pool of ARPA dollars crucial to the community development field has received less public attention – the $360 billion in federal relief payments allocated to State, Tribal, territorial, city, and county governments nationwide. As our partners at the National League of Cities shared, this is the first time the federal government has provided direct relief to all of our nation’s 19,000 municipalities. It is critical for neighborhood stabilization stakeholders and community leaders to know how much funding has been allocated for their communities, and to be involved in the planning for how these funds are programmed. Now is the time to reach out to your local leaders, demand a seat at the table, and make your voice heard.

1. How much relief is coming to my community?

Estimated allocations for each American city, town, county, and State can be found now in a downloadable spreadsheet[1] posted on the House Oversight Committee’s website. If you’re interested in viewing the allocations by map, communities can visit an interactive map provided by the Center for Community Progress that shows this data at the State, metro city, county, and local level at communityprogress.net/covid19.

Both resources allow the public to see how much funding is estimated to be coming to their community. For example, you can see in a search of Flint, Michigan that $99.33 million will be coming to the City of Flint, $78.7 million has been allocated to Genesee County, and $5.655 billion will be sent to the State of Michigan.

An important note for cities with populations below 50,000: these ARPA allocations are proportionate to population, and are limited to 75 percent of the locality’s most recent annual budget as of January 27, 2020. The estimates contained in the spreadsheet and mapping tool may not reflect this 75 percent cap.

2. When will funding be released?

Funding allocations to States, Tribes, counties, and cities with over 50,000 residents will be transmitted directly to these entities between now and May 10, 2021. Funding designated for smaller local governments with populations below 50,000 will be delivered to the States by May 10; States will then be required to distribute allocations to these communities based on population within 30 days of receipt.

Total allocations to counties, metro cities, and other localities will be released in two equal allotments, with the first half coming by May 10. The second half will be released 12 months later. In the Flint, MI example above, $49.66 million would be released to the city and $39.35 million would be released to Genesee County between now and May 10. 12 months after this first round of relief is delivered to the City of Flint and Genesee County, second installments of equal amounts will be transmitted.

3. How can ARPA funds be used?

State and local funds under ARPA must be used for:

• responding to the COVID-19 public health emergency and its negative economic consequences, including assistance to households, small businesses, and nonprofits, or aid to impacted industries such as tourism, travel, and hospitality;
• supporting essential workers;
• providing government services and offsetting revenue losses;
• necessary improvements to water, sewer, or broadband infrastructure.

Additionally, funds received by local or State governments may be transferred to nonprofit organizations or other jurisdictions to carry out eligible activities.

4. How long do communities have to spend these relief funds?

ARPA requires that these funds must be expended by December 31, 2024.

From land bank leaders and community development organizations to housing advocates and other allied nonprofits, every organization needs to engage with local, county, and State leaders about how this massive fiscal infusion should be used to meet their communities’ needs. This historic time and federal investment is a moment for us all to think big and be bold. With the right planning and community engagement, these recovery resources have the potential to be a game-changing event in the fight to mitigate the negative health and economic impacts of the current crisis. The challenges many communities now face are compounded by a complicated legacy of racial segregation and wealth inequality, disinvestment, and job and population loss. Today’s solutions cannot be divorced from these historic realities, and we urge community leaders everywhere to design a fair, equitable, and just recovery.

As more information becomes available, Community Progress will use our platform to share knowledge and engage partners about how the community development field can play a pivotal role in ensuring these funds are transformational.

[1] As of this blog post, the latest version uploaded to the House Oversight Committee’s website was updated on March 8, 2021.