American Rescue Plan Federal Funding for Townships

Posted on April 3, 2023 |

PSATS Guidance

Fact Sheet: PSATS American Rescue Plan Fact Sheet (Updated January 2024) provides guidance to townships about their options under U.S. Treasury’s Final Rule and the 2023 Interim Final Rule.

Webinar: On March 26, 2024, PSATS hosted a webinar to provide an overview of the ARP Funds, demonstrate how to access Treasury’s Reporting and Compliance Portal, and submit the 2024 Project and Expenditure Report. Townships can view a recording of the webinar (passcode: uHq!^9J^) or the download the presentation slides.

Please note that there were a few updates to the portal that we did not address in our webinar presentation.

First, on the project overview screen, a Yes/No dropdown will ask “have revenue replacement funds been allocated to government services and reflected in the below projects?” – as a reminder, revenue replacement with the standard allowance election is the most flexible option and all townships are recommended to create projects in this spending category.
Lastly, there are two Yes/No questions on the certification screen regarding Federal Audit Clearinghouse and Alternative Compliance Examination Engagement. These questions would only potentially be answered as Yes if your township spent $750,000 or more in federal funds in the most recent fiscal year and would require additional steps. If your township has not spend $750,000 or more in federal funds in the most recent fiscal year, both answers will be No.

Portal Access: Township officials may access the U.S. Treasury’s portal website at https://portal.treasury.gov/compliance using their login.gov account credentials (the same login and password as SAM.gov).

Townships using an id.me account can access U.S. Treasury’s portal website at https://portal.treasury.gov/cares.

Overview and Allowable Spending Options

2023 Interim Final Rule: On August 10, the U.S. Department of Treasury released the 2023 Interim Final Rule which added additional spending options per the Consolidated Appropriations Act (2023 CAA). Generally, this Interim Final Rule does not alter existing eligible use categories and all eligible uses described in the 2022 final rule remain available to recipients. The 2023 CAA codifies the “standard allowance” to replace lost revenue and use ARP funds to provide government services. Townships who already elected the standard allowance do not need to make any changes to their current revenue loss determination. The option to update the revenue loss determination will remain available through the April 2025 reporting period.

Remember, townships can use ARP funds for nearly any normal township expenses (with the exception of pension fund liability and debt) under the Standard Allowance – Revenue Replacement category. The funds can be applied to payroll, road and bridge projects, parks, administration expenses, insurance premiums, and much more. While the debt ceiling is not impacting the timeframe, ARP funds need to be obligated by December 31, 2024, which means they must be spent, under contract, or under purchase order by that date.

Final Rule: The U.S. Department of the Treasury released the final rule for the American Rescue Plan funds. Of note, the final rule includes a simplified lost revenue provision that gives each local government a $10 million standard allowance for lost revenues. This means that the first $10 million of your ARP dollars (not to exceed your award amount) can be spent on nearly anything that would normally be spent from your general funds, including roads and bridges.

Reporting

2024 Update: Treasury recently clarified that award recipients are required to continue to submit annual Project and Expenditure Reports, even if all funds have been spent. Treasury stated that they will provide closeout instructions later this year with additional information on how to complete and provide final reports.

Project and Expenditure Report: All award recipients are required to file a Project and Expenditure Report each year. The first annual report was due on April 30, 2022 and covered activity from March 3, 2021 through March 31, 2022. The second annual report was due on April 30, 2023 covering activity from April 1, 2022 through March 31, 2023.

Report Guidance: Below are links to resources related to the annual report. Please note that provisions in these documents refer to non-entitlement units, which are municipalities with populations of less than 50,000. Most townships are classified as non-entitlement units or NEUs.

Townships may access the U.S. Treasury’s portal website at https://portal.treasury.gov/compliance using your login.gov account credentials. This is the same login and password as your SAM.gov account and the Federal CDL Drug & Alcohol Clearinghouse.
Login.gov User’s Guide: U.S. Treasury document showing how to login to your account and take the first steps to link your account. Please note that you need to use the very first link to login to the portal via login.gov.
Account Validation Guide: U.S. Treasury document to explain the process for new users accessing Treasury’s portal. Please note, this process requires the account ID sent via email in March 2023 to the individual Treasury currently has on file.
PSATS quick guide (Updated April 2023) PSATS short guide on How to File Project and Expenditure Report provides step by step instructions to townships on completing the report, including electing the standard allowance.
Example Scenario Guide: PSATS examples to assist townships in reporting their obligations and expenditures in the 2023 report.

SAM.gov Registration

SAM.gov Renewal: SAM.gov registration is required for American Rescue Plan funds as well as other federal funding (including disaster aid). Renewals must be completed each year on the SAM.gov website. If you have any questions, concerns, or issues while renewing your SAM registration, please contact the Federal Service Desk at 866-606-8220.

Incorporation Information: SAM.gov registration now requires municipalities to provide written documentation of their incorporation in order to register, renew, and apply for feral grants. The Pennsylvania State Archives has a webpage dedicated to incorporation dates and official names for all Pennsylvania municipalities organized by County. The Archives office has also prepared a guide to help municipalities to locate their incorporation documents or approved documentation.

Links to Resources

Treasury Links: Treasury has compiled many documents about the final rule and how it applies. While these documents are all available on Treasury’s website, they are not all easy to find.

Overview of the Final Rule: 44-page document provides an overview of the Final Rule.
Final Rule: The new document provides responses to comments and detailed explanations of the rule. Note that the actual language of the Final Rule begins on page 109. The rule is now formatted for publication in the Federal Register.
FAQs on Final Rule: (Updated July 2022) Frequently Asked Questions and Answers provided by U.S. Treasury explaining the allowable expenses and reporting under the Final Rule.
SLFRF Compliance and Reporting Guidance: This document (updated June 2023) provides an overview of reporting requirements for all award recipients and compliance requirements under each project category.
Project and Expenditure Report User Guide: (Updated April 2023) U.S. Treasury document providing a detailed explanation of the Project and Expenditure Report. Note that some of these provisions only apply to states and larger entities, not townships.

Accounts: DCED recommends using 352.53 or 352.530, Federal Entitlements to Governmental Units, from the Chart of Accounts for this new revenue source. It is recommended that the funds be transferred into a separate interest-bearing account. Accounts for expenditure should follow the Chart of Accounts. Townships can reference this sample budget resolution if making supplemental appropriations to the budget to account for ARP expenses.

PSATS Premier Partner: PSATS’ Premier Partner, Zelenkofske Axelrod LLC, will work with your township to find eligible uses for the funds that benefit your community and help you navigate federal compliance and reporting requirements. The company can ensure that an eligible use meets the program requirements and that your documentation is complete. There is an additional fee for this service, which is an eligible use of the ARP funds, and the company is offering discounted pricing to PSATS members. To learn more, contact Cory Johnson at cjohnson@zallc.org or call (717) 561-9200, ext. 5300