Funding at a Glance

How to spend these appropriations will be a key question for our municipalities over the next several years.

The U.S. Treasury issued official guidance on allowable uses for ARP funds by local governments on May 10, 2021. That guidance can be viewed here. Please visit our U.S. Treasury guidance page, here

Use of funds:
  • Respond to the COVID-19 emergency and address its economic effects, including through aid to households, small businesses, nonprofits, and industries such as tourism and hospitality.

  • Provide premium pay to essential employees or grants to their employers. Premium pay couldn’t exceed $13 per hour or $25,000 per worker.

  • Provide government services affected by a revenue reduction resulting from COVID-19.

  • Make investments in water, sewer and broadband infrastructure.

Restrictions of Funds:
  • State and local governments cannot use the funds towards pensions or to offset revenue resulting from a tax cut enacted since March 3, 2021.

Transfer Authority
  • State and local governments could transfer funds to private nonprofit groups, public benefit corporations involved in passenger or cargo transportation, and special-purpose units of state or local governments, but only as allowed under state law and state constitutional provision.


A high-level fact sheet of allowable uses has been published by the U.S. Treasury, and can be read here.

NCLM's summary of the State and Local Recovery Funds program can be read below.