On March 11, 2021, the American Rescue Plan Act (ARPA) was signed into law by President Biden. ARPA provides direct relief to all 19,000 cities, towns and villages across the United States affected by COVID-19. The purpose of ARPA is to support pandemic recovery efforts, replace public sector lost revenue, spur job growth, jump start economic growth through household and business stabilization and address systemic public health and economic challenges.
Funds will be administered by the U.S. Treasury directly to municipalities (over 50,000 population) and to the state for distribution to local governments with populations under 50,000. Of the $65.1 billion, 70% of the funds ($45.57 billion) will be allocated to cities with over 50,000 population and the remaining $19.53 billion (30%) to the smaller locales. These are not competitive grants and do not require federal application. However, communities will need to work with the state to obtain funds.
In addition to funds for local governments, counties and states will receive APRA funds. Anticipated Nebraska state and local allocations are currently estimated at $1.77 billion - $1.1 billion at the state level and $667 million for local governments (cities and counties). The Nebraska Department of Education and school districts will receive $545 million bringing Nebraska’s estimated ARPA funds to $2.3 Billion.
ARPA - Local Government Guidelines
Distribution guidelines for Non-Entitlement Units (NEU) of Local Governments (cities under 50,000) are still being developed at the time of this article. However, general guidance will help communities better understand and strategically prepare for fund distribution.
The amount of funds distributed to local governments is based on the proportion of the population in the NEU (community under 50,000) as a share of the total population of all NEUs in the state, according to the most recent Census data. These are estimates that may be determined by other factors, per state recommendations. A spreadsheet of estimated funding allocations can be found on the House Committee on Oversight and Reform website (see site, bottom of page).