Frequently Asked Questions
NCLM Answered FAQs
For the 'Revenue Loss' category, what is the Standard Allowance?
Cities and towns can now use up to $10 million of ARP funds towards general government services under a new “standard allowance” for revenue replacement. The update was announced by U.S. Treasury in its State and Local Fiscal Relief Fund (SLFRF) final rule published Jan. 6. More information on this update is available on our blog, here and here.
Can ARP funds be used to pay the regular salary and benefits for employees?
The regular salary and benefits for public safety, public health, health care, human services, and similar employees can be funded with ARP to the extent that they are completing work directly related to the public health response. The allowed use of funds is under the “respond to public health emergency” eligible funding category in the U.S. Treasury guidance.
Can ARP funds be used to provide premium pay to employees?
Premium pay is in addition to an employee’s regular salary and benefits. In recognition of the health and safety risks of essential workers who have been and continue to be relied on to maintain continuity of operations, ARP funds can also be used to provide premium pay. Essential workers are those whose work involves regular in-person interactions or regular physical handling of items that were also handled by others. The allowed use of funds is under the “premium pay” eligible funding category in the U.S. Treasury guidance.
Is Council approval required to receive ARP funds?
To the best knowledge of both the N.C. League and the N.C. Office of State Budget and Management, Council approval is not a requirement of the American Rescue Plan. However, it may be required by the rules of your local government. Thus, it is included in the checklist to ensure that funds are received in a timely manner, should that step be needed in your city or town.
What is the definition of "budget" for the purpose of the 75 percent cap of NEU, or non-CDBG, payments?
Treasury interprets the most recent budget as the NEU's most recent annual total operating budget, including its general fund and other funds, as of January 27, 2020.
How many payment distributions will be received? When will the distributions be received?
Local governments will receive funds in two payments, with 50% provided beginning in May 2021 and the balance delivered 12 months later.
Will 2020 Census data change distribution amounts?
Distributions were calculated based on 2019 Census population data, Treasury provided no indication that distribution amounts will be changed to reflect 2020 Census data.
Can funds be used to match federal grants?
Funds are subject to any pre-existing limitations of Federal statue and regulations. Funds cannot be used as a non-Federal match for other Federal programs that restrict the use of Federal funds to meet matching requirements.
What is the best resource for information on how funds can be used?
Treasury’s Final Rule provides guidelines and principles for determining the types of programs and services that funding can support. The guidance creates the "standard allowance" for revenue replacement, and provides examples of allowable uses that recipients may consider. Within the categories of eligible uses, recipients have broad flexibility to decide how best to use this funding to meet the needs of their communities.
Do Coronavirus Local Fiscal Recovery Funds need to be set up in a new or unique bank account?
No, but it is essential that you have a way to track the expenditure and use of these funds separately from all other funds you manage, including any other Coronavirus Relief Funds you have already received. The U.S. Department of Treasury is already advising that most of the provisions of the Uniform Guidance (2 CFR Part 200) apply to the Coronavirus Local Fiscal Recovery Funds program, including the Cost Principles and Single Audit Act requirements. NCPRO is compiling more information and guidance, and the Treasury will make its Assistance Listing available at beta.SAM.gov for detail on the specific provisions of the Uniform Guidance that do not apply to this program.
Below is an extensive list of FAQs, as compiled by the U.S. Treasury.
NCLM will continue to share resources for assistance in interpreting the Treasury guidance. For questions specific to North Carolina municipalities, please do not hesitate to contact us at ARP@nclm.org for guidance.