With the American Rescue Plan, Careful and Prudent Approach Makes Sense
As you receive inquiries related to ARP and its funding, you may find the following points helpful.
Across North Carolina, a media narrative that seems to be gaining steam regarding American Rescue Plan Act funding can be summed up in these six words: “Why haven’t you spent that money?”
To those involved in the administration of these funds, it is a question fueled by some basic misunderstanding around the federal law, its requirements and even its potential to result in transformative projects.
As you receive inquiries related to the ARPA and its funding, you may find the following points helpful in your response:
This funding is not required to be spent until 2026. Cities and towns are carefully planning for projects that will positively impact citizens’ lives for years. A go-slow approach that may involve partnering with other local governments or leveraging state dollars can makes sense to get the best bang for the buck.
Cities and towns have and are continuing to actively engage with citizens regarding needs that can be met with these funds. That careful engagement takes time.
The US Treasury Department only issued final guidance on eligible expenses in January. Additional rules on procurement could be issued, and it is crucial that all local governments follow strict accounting and other rules.
Many cities and towns have made decisions on how the money will be spent. Executing those decisions takes time, especially for infrastructure investments that will require permitting and other approvals.
Capacity to plan and implement decisions, given the complexities involved, is limited. NCLM, state agencies, the UNC School of Government and other partners are working to assist in that capacity.
Due to supply chain issues and labor shortages, the construction industry faces delays in starting projects. These issues will inevitably spill over into some areas of ARPA spending.
As you receive inquiries regarding ARPA funding, conveying the information listed above may prove helpful. The goal is not to the be the fastest out the door, but to have the greatest impact on residents’ lives, and that reminder may better inform everyone about the purpose and potential of the American Rescue Plan Act.