American Rescue Plan

As we get closer to the release of State and Local government funds in the Federal American Rescue Plan, we'll regularly update our communities on the County's process and progress in making a plan to put the one-time funding to its best use.

One of the elements in the American Rescue Plan passed by Congress and signed into law by President Biden in March is a significant infusion of funds for state, county and municipal governments. Based on the distribution formula established in the law, Cumberland County expects to receive around $57 million in two payments - with the first half expected to arrive in the next week, and the second half at least one year later.

So far, not a lot is known about the rules that will govern how counties and towns can spend those funds - but we have some broad guidance. The bill says that the funds can be spent in the following categories:

• Respond to or mitigate the public health emergency with respect to the COVID-19 emergency or its negative economic impacts, including assistance to households, small businesses, and nonprofits, or aid to impacted industries such as tourism, travel, and hospitality. These examples are intended to clarify congressional intent that these activities are eligible. However, state and local activities are NOT limited only to these activities. 
• Provide government services to the extent of the reduction in revenue (i.e. online, property or income tax) due to the public health emergency.
• Make necessary investments in water, sewer, or broadband infrastructure.
• State and local governments can transfer the funds to a private nonprofit organization, a public benefit corporation involved in the transportation of passengers or cargo or a special-purpose unit of State or local government. 
• Respond to workers performing essential work during the COVID-19 public health emergency by providing premium pay to eligible workers of the county that are performing such essential work, or by providing grants to eligible employers that have eligible workers who perform essential work. “Premium pay” means an additional amount up to $13 per hour that is paid to an eligible worker for work during the COVID-19 pandemic. The law imposes a cap of $25,000 for any single eligible worker. 

For now, we have a few broad guardrails for Recovery Funds - although this is expected to change, likely in the next week: 

• States are not allowed to use the funds to either directly or indirectly offset a reduction in the net tax revenue that results from a change in law, regulation or administrative interpretation during the covered period that reduces any tax. If a state violates this provision, it will be required to repay the amount of the applicable reduction to net tax revenue.
• No funds shall be deposited into any pension fund. 
• Any local government, including counties, that fail to comply with the federal law and related guidelines shall be required to repay the federal Treasury.

Cumberland County does not expect to partner with a specific area agency or consultant to expend the funds - our Executive Office has spent the past two months preparing to conduct a thoughtful and comprehensive review of the needs of the region, and identify opportunities to combine our efforts with state and local governments in order to maximize the impact of these funds. 

Outreach and community input will certainly be key to a successful rollout of the ARP in Cumberland County. Executive staff have been working to establish a plan for seeking input from leaders across a wide range of expertise - and from the residents of Cumberland County - once the Department of Treasury offers some more guidance regarding what, exactly, we can use these funds for. We've also had early conversations with regional experts in order to get a big-picture sense of the challenges and opportunities that our region faces, and these conversations will continue.

That outreach program will soon expand to collect more perspectives and guidance as we set a plan for these funds. So stay tuned - We'll be seeking your input soon!

---