Every time we hear a question about the approved, appropriate uses of the highly anticipated American Rescue Plan funding coming to ALL municipalities across the country, the answer has universally been, “We are waiting on guidance from Treasury”. Well, rumor has it that Treasury (meaning the US Treasury Department) is about to release their “guidance”, maybe as soon as this week. You may be assured that whenever we receive the guidance, it will be posted on MML’s American Rescue Plan webpage (ADD LINK) and the information summarized in future editions of the eBulletin, various blast emails from MML and upcoming MML sponsored webinars.
In the meantime, MML advises not to assume anything is permitted beyond the four very broad categories included in the Act:
- Responding to or mitigating the COVID-19 health emergency or its negative economic impacts, including assistance to households, small businesses, nonprofits, and aid for tourism, travel, and hospitality.
- To provide essential workers with premium pay.
- To cover revenue loss incurred as a result of the COVID-19 emergency; or
- To make necessary investments in water, sewer, or broadband infrastructure
There are also two major facts that we share with municipal leaders in conversations:
- The estimates given to local governments in March are just ESTIMATES. They are subject to change with the long-awaited “guidance” from Treasury.
- The amount a municipality receives in ARP funds cannot exceed 75% of a respective municipality’s annual budget.
While we wait on Treasury for guidance, MML suggests you do the following:
- Start to “think about” what projects/uses for the funds might fit the criteria included in the Act. DO NOT BUDGET FOR ANYTHING THIS YEAR. You have until 12/31/24 to expend the funds allocated. There is TIME!
- Collaborate with your community leaders and maybe neighboring community’s elected leaders about how you may want to pool your resources to accomplish a larger project.
- Lastly, MML advises you to be patient! If history is any lesson, the actual distribution of the funds will be delayed, and deadlines likely extended. This is a mammoth undertaking and will not happen overnight for the Federal government nor for state and local governments.
What is MOST important is that we, as municipal governments, are good stewards of the taxpayer’s money. We want to do this RIGHT!! There may not be a second chance.