U.S. Senate Passes Legislation Expanding Scope for Federal Recovery Funds

Bipartisan legislation aims to provide state and local governments flexibility to invest a portion of the American Rescue Plan Act’s (ARPA) Coronavirus State and Local Fiscal Recovery Funds (Recovery Funds) in transportation, infrastructure, and government services.

This month, the U.S. Senate passed S.3011 – State, Local, Tribal, and Territorial Fiscal Recovery, Infrastructure, and Disaster Relief Flexibility Act, legislation that would allow counties nationwide to use a total of over $27 billion for new transportation and infrastructure projects and over $17 billion for government services.

As previously reported on Conduit Street, the American Rescue Plan Act of 2021 includes $65.1 billion in direct, flexible aid to every county in America and other crucial investments in local communities. Unfortunately, many recipients of these funds have been unable to access them or spend them on worthwhile purposes.

This bipartisan bill expands the eligible uses of these funds to include infrastructure, disaster relief, housing, community development, and other investments that will generate long-term economic returns. This flexibility is crucial as some local governments struggle to make necessary investments in their community to comply with the funds’ existing guidance.

While this legislation provides much-needed flexibility, it neither mandates funds for any particular purpose nor increases overall federal spending. The legislation would also cap funds that a recipient could use for the newly eligible activities, thereby ensuring Recovery Funds continue to address the public health emergency and its impacts.

This table from NACo highlights how much Maryland counties could use towards transportation and infrastructure projects or government services under S. 3011.

According to a letter from the National Association of Counties (NACo):

America’s counties have been engaged in our nation’s response to COVID-19 since the earliest days, and providing local leaders with flexible, essential financial resources is the surest way to see that our nation’s preparedness and responsivity continues.

With the additional flexibility provided by S. 3011, the true intent ofthe ARPA – to assist state, local and tribal governments in their recovery from the disastrous impacts of the global pandemic – can be realized. We believe this legislation is imperative to leverage the full benefits of the ARPA’s once-in-a-generationinvestments. We thank you for your partnership and respectfully ask that you swiftly pass S. 3011.

S. 3011, as well as its companion legislation, await action in the U.S. House of Representatives.

Visit the NACo website for more information.