The American Rescue Plan (ARP) Act of 2021, a $1.9 trillion economic relief package, was signed by President Joe Biden on March 11. Much of the funding included will have impacts on states, both in their budgets and in the specific policies they enact. The Council of State Governments (CSG) is providing our members with ongoing analyses of the various components of the ARP in this special edition series of The Current State e-newsletter, out each Monday.
This week, The Council of State Governments provides resources on how states can utilize American Rescue Plan Act funds to support rural communities and for election security/civics education. This special edition of The Current State weekly e-newsletter also includes news, updates and resources related to states ending expanded unemployment benefits, infrastructure efforts and the Emergency Connectivity Fund.
STATE UTILIZATION OF FEDERAL FUNDS
As state policymakers weigh options on how to maximize relief funding from the ARP, state officials have begun to appropriate the stimulus funds.
· Alabama Attorney General Steve Marshall is urging state officials to focus a portion of ARP spending on crime prevention. With an estimated $2.1 billion set to hit the state’s coffers, Marshall argues that guidance from the U.S. Department of the Treasury allows funds to be spent on law enforcement hiring and training and hiring court employees to address legal backlogs.
· The U.S. Department of the Treasury is asking a federal judge to dismiss a case that argues Arizona lawmakers can use ARP funds to offset tax revenue losses. Arizona has accepted $4.9 billion. An assistant federal attorney general says stipulations of the funding clearly state that states may not use funds to “directly or indirectly offset a reduction in net tax revenue.”
· More than $7 billion is now available to California residents behind on rent and utility payments as part of approved state budget plans for Fiscal Year 2022. The state plans to use $5.2 billion of ARP funds to pay 100% of outstanding rent payments, with the remaining $2 billion going toward outstanding water and electricity payments. The state also plans to subsidize rent for low-income families over the next two months.
· A new Colorado law allows qualifying Native American students to receive in-state tuition at any Colorado public university. The law, which takes effect in the 2021-22 academic year, requires public institutions of higher learning to “adopt policies to charge in-state tuition to any Native American student who is a registered member of a federally recognized American Indian tribe with historical ties to Colorado.”
· Hawaii Gov. David Ige will maintain COVID restrictions until the state reaches a vaccination rate of 70%. The current rate is 58.6%. While state emergency declarations are set to expire Aug. 6, Ige announced his plan to extend this deadline.
· Illinois lawmakers recently finalized the state’s Fiscal Year 2022 budget, which included $2.8 billion dollars in spending funded through the ARP:
- Department of Commerce and Economic Opportunity – $573.7 million
- Back to Business Grant Program – $300 million
- Workforce Recovery – $50 million
- Tourism Attraction Development Grant Program – $10 million
- Department of Healthcare and Family Services – $280 million
- Support to hospitals – $180 million total ($30.0 million specifically for safety net hospitals)
- Support to providers of long-term care services – $75 million
- Support to specialized mental health rehabilitation facilities – $5 million
- Department of Human Services – $70 million
- Trauma/Mental Health/Behavioral Health – $50 million
- Housing is Recovery Pilot Program – $10 million
- First Responder Mental Health – $5 million
- Suicide prevention – $5 million
- Illinois Criminal Justice Information Authority
- Grants for violence prevention programs – $50 million
- Other Violence Prevention Grants – $5.85 million
- Department of Human Services
- Summer Youth Employment – $60 million
- Teen Reach – $10 million
- Department of Children and Family Services
- Child Advocacy Centers – $3 million
- Illinois State Board of Education
- Grant to the Black and Gold Initiative for mentoring, education programing and violence prevention for high school students – $75,000
· An Indiana Court of Appeals ruled the state must temporarily continue to accept and distribute the expanded federal unemployment benefits provided by the ARP. On June 14, the Marion Superior Court ruled state law requires the state to accept federal unemployment benefits.
· Kansas rural hospitals are set to receive $23.5 million from the federal government to bolster COVID-19 services. Funding will go to critical access hospitals with fewer than 50 beds.
· Louisiana is the latest state to indicate it will seek to end expanded federal unemployment benefits from the Pandemic Unemployment Assistance program, covering “gig workers,” and Pandemic Emergency Unemployment Compensation, which allowed people to receive jobless benefits past the state’s 26-week limit. It also plans to do away with Mixed Earner Unemployment Compensation (MEUC).
· A Maryland judge has blocked Gov. Larry Hogan’s plan to end federal unemployment benefits to individuals drawing state unemployment insurance. Baltimore Circuit Court Judge Lawrence Fletcher-Hill granted a preliminary injunction, stating “the personal magnitude of harm” outweighs the potential financial benefits to the state. The judge also stated the plaintiffs would likely succeed in their claim that the Maryland Department of Labor is bound by state unemployment law to accept federal unemployment aid.
· New Jersey will begin to distribute $30 million in federal funds to help colleges and universities recover from COVID-19 losses. The majority of the funding, $28.5 million, will go to three dozen schools that applied to the state’s competitive grant program, in which the money will be used to institute “college-wide reforms” to protect against future challenges.
· Ohio Gov. Mike DeWine signed a bill that bans schools and universities from requiring COVID-19 vaccines that have not received full federal Food and Drug Administration approval. The law does not go into effect for 90 days, meaning if vaccines receive full approval in that time frame, the language would be moot.
· Oklahoma will begin offering a one-time back-to-work incentive. To qualify for the $1,200 payment, Oklahomans need to have left an unemployment insurance program and to have worked six consecutive weeks of either one full-time or two part-time positions of 32 hours or more.
· The U.S. Department of Education has released the remaining $830 million for Tennessee K-12 schools. This sum is the final payment from the original $2.5 billion received from the coronavirus aid package.
· Utah has released its plan to spend $205.5 million from the Elementary and Secondary School Emergency Relief fund. The state plans to prioritize mental health and social emotional needs while facilitating a safe return to in-person instruction.
· Wisconsin Gov. Tony Evers announced he will direct $130 million in federal funding toward work force development programs. The largest block of funding will provide grants to at least 10 local and regional entities with about $10 million each to help meet needs including child care, transportation and housing. Evers said funding would go out sometime in the fall to give regions time to develop proposals.
NEWS, UPDATES AND RESOURCES
Federal Updates
Child Tax Credits begin paying out to American families
Starting July 15, families will receive $250-$300 for each child. According to the White House, these credits will support 60 million children by giving their families $15 billion in payments per month. State, local and tribal governments are encouraged to ensure families are aware of this tax credit and assist families with filing tax returns who may have low-incomes and have not file in the past. Local leaders also are encouraged to use state-run program data [i.e. Supplemental Nutrition Assistance Program (SNAP), Temporary Assistance for Needy Families (TANF)] to identify families who may not have filed tax returns in the previous year. More information can be found at childtaxcredit.gov.
Administration outlines violence prevention efforts
President Biden is encouraging local officials to use American Rescue Plan funds to prevent violent crime amid a rise in gun violence over the last year. The White House released a comprehensive plan to tackle the sale of illegal firearms along with guidance on investing in community programs, officer hiring and aid for reentry for formally incarcerated individuals. You can read the White House memo by CLICKING HERE. You can read the fact sheet by CLICKING HERE.
Expanded unemployment benefits stopping and restarting in some states
Twenty-six states have moved to end some or all expanded federal unemployment benefits. Some states that had stopped benefits have been ordered by various courts to resume payments pending further decisions. States will be allowed to restart pandemic unemployment programs as more states face lawsuits over termination of federal benefits. The White House announced there may be a break in payments to laid-off workers as the restart process goes forward. Currently, Indiana, Maryland, Ohio, Oklahoma and Texas are facing lawsuits that seek to force their governors to continue federal unemployment benefits through the national deadline of Sept. 6.
Local Government
City efforts to renew water infrastructure
Cities across the country are using American Rescue Plan funding to address aging water systems and sewage infrastructure. Bozeman, Montana, is set to spend $3.4 million on water infrastructure with an additional $6.5 million intended to encourage economic growth through sewer improvements. On New York’s Long Island, Suffolk County plans to use $46 million of its federal allocation to connect area homes and businesses to sewer systems. Louisiana legislators have set aside $300 million from ARP to improve community water systems, with an independent commission set to determine the specifics of spending later this fall.
Providence to implement a Basic Income Program
Residents of Providence, Rhode Island, can apply for $500 a month guaranteed income as the state begins a pilot income program. Mayor Jorge Elorza says this program will exist alongside other social welfare programs in the state. The pilot program will run for one year and is restricted to residents whose income falls below 200% of the federal poverty level.
Counties eyeing equity with ARP money
At the annual meeting of the National Association of Counties (NACO), government and nonprofit organization officials urged local governments to consider equity when allocating American Rescue Plan (ARP) funding. Several members of local governments, including members of Harris County, Texas, government, which includes Houston, shared their plans for equitable allocation, but emphasized that equity within communities requires more than just ARP spending.