Aid to state, local, territorial, and Tribal governments will help bring back jobs, address pandemic’s economic fallout, and lay the foundation for a strong, equitable recovery
WASHINGTON — Today, the U.S. Department of the Treasury announced the launch of the Coronavirus State and Local Fiscal Recovery Funds, established by the American Rescue Plan Act of 2021, to provide $350 billion in emergency funding for state, local, territorial, and Tribal governments.
> Treasury also released details on the ways funds can be used to respond to acute pandemic-response needs, fill revenue shortfalls among state and local governments, and support the communities and populations hardest-hit by the COVID-19 crisis.
> Eligible state, territorial, metropolitan city, county, and Tribal governments will be able to access funding directly from the Treasury Department in the coming days to assist communities as they recover from the pandemic.
“Today is a milestone in our country’s recovery from the pandemic and its adjacent economic crisis. With this funding, communities hit hard by COVID-19 will able to return to a semblance of normalcy; they’ll be able to rehire teachers, firefighters and other essential workers – and to help small businesses reopen safely,” said Secretary Janet L. Yellen. “There are no benefits to enduring two historic economic crises in a 13-year span, except for one: We can improve our policymaking. During the Great Recession, when cities and states were facing similar revenue shortfalls, the federal government didn’t provide enough aid to close the gap. That was an error. Insufficient relief meant that cities had to slash spending, and that austerity undermined the broader recovery. With today’s announcement, we are charting a very different – and much faster – course back to prosperity.”
While the need for services provided by state, local, territorial, and Tribal governments has increased —including setting up emergency medical facilities, standing up vaccination sites, and supporting struggling small businesses—these governments have faced significant revenue shortfalls as a result of the economic fallout from the crisis. As a result, these governments have endured unprecedented strains, forcing many to make untenable choices between laying off educators, firefighters, and other frontline workers or failing to provide services that communities rely on. Since the beginning of this crisis, state and local governments have cut over 1 million jobs.
The Coronavirus State and Local Fiscal Recovery Funds provide substantial flexibility for each jurisdiction to meet local needs—including support for households, small businesses, impacted industries, essential workers, and the communities hardest-hit by the crisis.
Within the categories of eligible uses listed, recipients have broad flexibility to decide how best to use this funding to meet the needs of their communities. In addition to allowing for flexible spending up to the level of their revenue loss, recipients can use funds to:
- Support public health expenditures, by – among other uses – funding COVID-19 mitigation efforts, medical expenses, behavioral healthcare, mental health and substance misuse treatment and certain public health and safety personnel responding to the crisis;
- Address negative economic impacts caused by the public health emergency, including by rehiring public sector workers, providing aid to households facing food, housing or other financial insecurity, offering small business assistance, and extending support for industries hardest hit by the crisis
- Aid the communities and populations hardest hit by the crisis, supporting an equitable recovery by addressing not only the immediate harms of the pandemic, but its exacerbation of longstanding public health, economic and educational disparities
- Provide premium pay for essential workers, offering additional support to those who have borne and will bear the greatest health risks because of their service during the pandemic; and,
- Invest in water, sewer, and broadband infrastructure, improving access to clean drinking water, supporting vital wastewater and stormwater infrastructure, and expanding access to broadband internet.
Insufficient federal aid and state and local austerity under similar fiscal pressures during the Great Recession and its aftermath undermined and slowed the nation’s broader recovery. The steps the Biden Administration has taken to aid state, local, territorial, and Tribal governments will create jobs and help fuel a strong recovery.
And support for communities hardest-hit by this crisis can help undo racial inequities and other disparities that have held too many places back for too long.
For an overview of the Coronavirus State and Local Fiscal Recovery Funds program including an expanded use of eligible uses, see the fact sheet released today.
Find additional details on the state, local, territorial, and Tribal government allocations on the Coronavirus State and Local Fiscal Recovery Funds Webpage.
For updates from Treasury Department Relief and Recovery Programs, sign up.
Coronavirus State and Local Fiscal Recovery Funds
The American Rescue Plan will deliver $350 billion for eligible state, local, territorial, and Tribal governments to respond to the COVID-19 emergency and bring back jobs.
The Coronavirus State and Local Fiscal Recovery Funds provide a substantial infusion of resources to help turn the tide on the pandemic, address its economic fallout, and lay the foundation for a strong and equitable recovery.
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- Interim Final Rule
- Fact Sheet
- FAQs
- Quick Reference Guide
- Press Release
- Tribal Government Information
- Non-Entitlement Unit Information
- Interim Final Rule
- Fact Sheet
- FAQs
- Quick Reference Guide
- Press Release
- Tribal Government Information
- Non-Entitlement Unit Information
Funding Objectives
Treasury is launching this much-needed relief to:
- Support urgent COVID-19 response efforts to continue to decrease spread of the virus and bring the pandemic under control
- Replace lost revenue for eligible state, local, territorial, and Tribal governments to strengthen support for vital public services and help retain jobs
- Support immediate economic stabilization for households and businesses
- Address systemic public health and economic challenges that have contributed to the inequal impact of the pandemic
The Coronavirus State and Local Fiscal Recovery Funds provide substantial flexibility for each government to meet local needs—including support for households, small businesses, impacted industries, essential workers, and the communities hardest hit by the crisis. These funds can also be used to make necessary investments in water, sewer, and broadband infrastructure.
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INSERT FOR RELATED CONTENT
Treasury Releases Guidance on American Rescue Plan and Opens Portal
Eligible cities and counties can now apply for Coronavirus State and Local Fiscal Recovery Funds.
The U.S. Department of Treasury has opened a portal for cities and counties to apply for Coronavirus State and Local Fiscal Recovery Funds authorized by the American Rescue Plan Act. Treasury also released guidance and an interim final rule on how the funds may be used.
To help local leaders navigate this new information, ICMA will host a webinar on Monday, May 17, featuring a team from The Ferguson Group (an ICMA Strategic Partner). In the weeks ahead, ICMA will provide additional learning opportunities, more analysis of the guidance, as well as advice on how local governments can tap all of the available federal resources to make strategic investments and to support the long-term economic recovery in their communities.
Important reminders:
- Even if your jurisdiction is eligible for a direct allocation and has used the Treasury portal to request funding from other federal programs, you must submit a new request to receive Coronavirus State and Local Recovery Funds.
- Non-entitlement units (NEUs) of local government are eligible to receive funding from their state government. After a state government requests its own funds and Treasury issues additional guidance on distributions to NEUs, check with your state officials to find out how to receive the funding.
For an overview of the recovery funds program including eligible uses, see this May 10 fact sheet. For additional details on the state, local, territorial, and tribal government allocations, see the full list here.
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Concurrent with this program launch, Treasury has published an Interim Final Rule that implements the provisions of this program.
How to Request Funding
Eligible state, territorial, metropolitan city, county, and Tribal governments may now request their allocation of Coronavirus State and Local Fiscal Recovery Funds through the Treasury Submission Portal.
Funding Amounts
Congress has allocated Coronavirus State and Local Fiscal Recovery Funds to tens of thousands of eligible state, local, territorial, and Tribal governments. These allocations include:
| Type | Amount ($ billions) |
|---|---|
| States & District of Columbia | $195.3 |
| Counties | $65.1 |
| Metropolitan Cites | $45.6 |
| Tribal Governments | $20.0 |
| Territories | $4.5 |
| Non-Entitlement Units of Local Government | $19.5 |
Treasury will distribute funds to eligible state, territorial, metropolitan city, county, and Tribal governments.
Eligible local governments that are classified as non-entitlement units should expect to receive this funding through their applicable state government. Non-entitlement units are generally local governments with populations of less than 50,000.
Jurisdictions classified as non-entitlement units cannot receive this funding directly from Treasury and should not request funding through the Treasury Submission Portal.
Allocation Information
Treasury has published detailed allocation information for the Coronavirus State and Local Fiscal Recovery Funds:
- Allocation Methodology for States (PDF)
- Allocation for States (PDF) / Allocation for States (CSV)
- Allocation Methodology for Non-Entitlement Units (Aggregate State Totals) (PDF)
- Allocation for Non-Entitlement Units (Aggregate State Totals) (PDF) / Allocation for Non-Entitlement Units (Aggregate State Totals) (CSV)
- Allocation Methodology for Territories (PDF)
- Allocation for Territories (PDF) / Allocation for Territories (CSV)
- Allocation Methodology for Counties (PDF)
- Allocation for Counties (PDF) / Allocation for Counties (CSV)
- Allocation Methodology for Metropolitan Cities (PDF)
- Allocation for Metropolitan Cities (PDF) / Allocation for Metropolitan Cities (CSV)
Additional information regarding allocations for non-entitlement units and Tribal governments may be found below.
Non-Entitlement Units
Funding amounts for non-entitlement units are presently available only in aggregate at the state level. Treasury expects to provide further guidance on distributions to non-entitlement units in the coming days.
Additional Information on Non-Entitlement Units
Tribal Governments
The Coronavirus State Fiscal Recovery Fund will provide $20 billion to support Tribal governments.
Additional Information for Tribal Governments
To protect the privacy of Tribal government information, each Tribal government will receive its allocation amount after submitting its request for funding in the Treasury Submission Portal.
Tranching of Funds
Local governments will receive funds in two tranches, with 50% provided beginning in May 2021 and the balance delivered approximately 12 months later.
States that have experienced a net increase in the unemployment rate of more than 2 percentage points from February 2020 to the latest available data as of the date of certification will receive their full allocation of funds in a single payment; other states will receive funds in two equal tranches.
Governments of U.S. territories will receive a single payment. Tribal governments will receive two payments, with the first payment available in May and the second payment, based on employment data, to be delivered in June 2021.
More detailed information about funding amounts can be found in the allocation tables above.
Additional Information on Split Payments to State Governments
Use of Funds
The Coronavirus State and Local Fiscal Recovery Funds provide eligible state, local, territorial, and Tribal governments with a substantial infusion of resources to meet pandemic response needs and rebuild a stronger, and more equitable economy as the country recovers. Recipients may use these funds to:
- Support public health expenditures, by, for example, funding COVID-19 mitigation efforts, medical expenses, behavioral healthcare, and certain public health and safety staff
- Address negative economic impacts caused by the public health emergency, including economic harms to workers, households, small businesses, impacted industries, and the public sector
- Replace lost public sector revenue, using this funding to provide government services to the extent of the reduction in revenue experienced due to the pandemic
- Provide premium pay for essential workers, offering additional support to those who have and will bear the greatest health risks because of their service in critical infrastructure sectors
- Invest in water, sewer, and broadband infrastructure, making necessary investments to improve access to clean drinking water, support vital wastewater and stormwater infrastructure, and to expand access to broadband internet
Within these overall categories, recipients have broad flexibility to decide how best to use this funding to meet the needs of their communities.
Interim Final Rule
Funding from the Coronavirus State and Local Fiscal Recovery Funds is subject to the requirements specified in the Interim Final Rule adopted by Treasury on May 10, 2021.
This document has been submitted to the Office of the Federal Register (OFR) for publication and is currently pending placement on public display at the OFR and publication in the Federal Register. The document may vary slightly from the published document if minor editorial changes have been made during the OFR review process. Upon publication in the Federal Register, the regulation can be found at www.federalregister.gov, www.regulations.gov, and at www.treasury.gov. The document published in the Federal Register is the official document.
Treasury encourages state, local, territorial, and Tribal governments, as well as other stakeholders, to submit public comments on the Interim Final Rule.
FOR MORE INFORMATION
For general questions about this program, please email SLFRP@treasury.gov.
Prior Program Updates
Pre-Award Requirements (April 15, 2021)
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