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Weekly Update: March 21 – News and Resources for State Leaders

Emergency federal funding for states to address COVID-19 and the consequent economic stresses includes the American Rescue Plan Act, a $1.9 trillion economic relief package, and the Infrastructure Investment and Jobs Act, a $1.2 trillion initiative to improve infrastructure. This federal funding has and will continue to have an impact on state budgets and policies.

This week’s newsletter includes recent developments that every state leader needs to know regarding the federal budget, smarter budgeting, how states can conduct tax credit outreach and infrastructure grant opportunities.

New this week: 

  • In recognition of the anniversary of the enactment of the American Rescue Plan Act, CSG shares an Innovative Resource for State Leaders. The State ARPA Utilization Database, collected in collaboration with the National Association of State Budget Officers, provides a 50-state scan of the allocation of the State and Local Fiscal Recovery Fund. The dedicated fiscal policy website provides additional resources on components of ARPA and other enacted federal support for states.
  • CSG analysts provide research on how state policymakers have taken legal and regulatory actions to respond to Russia’s invasion of Ukraine: “State Responses to Crisis in Europe”
  • Congress passed (March 11) and President Joe Biden signed (March 15) the Consolidated Appropriations Act of 2022 (House Resolution 2471). CSG analysts provide an overview for state policymakers on the federal spending package in a new blog available here.
  • Register now for “Capitol Ideas Presents – Smarter State Budgeting: Balancing the Short- and Long-Term.” Join CSG for a conversation with Angela Oh, a senior manager with The Pew Charitable Trust, to explore principles for making strategic budget decisions, how ARPA recovery fund dollars are being utilized and how to better prepare for the future.

Recent Update Every State Leader Should Know: 

  1. When the Public Health Emergency declaration from COVID-19 ends, states will have to make policy and programmatic decisions to respond to changes in funding streams and eligibility requirements for programs like Medicaid and nutrition programs like Supplemental Nutrition Assistance Program (SNAP). CSG analysts are working to provide resources for state policymakers soon as states prepare to navigate the transition.
  2. During congressional negotiations on the Fiscal Year 2022 budget, it was proposed that an increase in COVID-19 relief be paid for by “clawing back” funds previously allocated to state and local governments in ARPA. State and local officials voiced concern over using the promised funds that are in varying degrees of the appropriation and expenditure process focused on short-term and long-term recovery. As a result, the COVID-19 Supplemental Appropriations Act was removed before final passage of the Consolidated Appropriations Act of 2022. Congress continues to consider supplemental relief funding as a stand-alone bill.
  3. The Federal Open Market Committee released a statement directing the Federal Reserve to increase interest rates for the first time since 2018, citing increased inflation pressures. The Board of Governors unanimously voted to increase the primary credit rate a ¼ percentage point to 0.5%. The increase took effect March 17, 2022, and will directly impact states in multiple ways, such as increasing the overnight rate for repurchase (i.e. borrowing for short-term cash needs).

NEWS, UPDATES AND RESOURCES

INFRASTRUCTURE INVESTMENT AND JOBS ACT

General

Departments of labor and transportation collaborate to support a diverse workforce and equitable access

A Memorandum of Understanding has been issued by Department of Labor and the Department of Transportation to leverage resources and opportunities to create a diverse infrastructure workforce and engage and develop partnerships to address barriers to increasing equitable access to Infrastructure Investment and Jobs Act jobs.

White House IIJA Guidebook School continues

The final Infrastructure Investment and Jobs Act Guidebook School webinars happen this week on Environmental Remediation and Broadband.

  • Environmental Remediation – March 22, 4-5 p.m. ET | Register
  • Broadband – March 24, 4-5 p.m. ET | Register

Fact Sheet issued on progress in implementing the Infrastructure Investment and Jobs Act

The White House shared a fact sheet detailing the progress and results of implementation of the infrastructure act programs.

Agriculture

$166.5 million for watershed production invested by Department of Agriculture

This first round of funding was provided through the Watershed Rehabilitation Program and the Watershed and Flood Prevention Operations Program. A complete list of current projects is available. Funding requests for projects from local sponsors continue to be accepted. The USDA Natural Resources Conservation Service will consolidate additional requests March 31 and create a second list of projects to fund. After March 31, additional projects will be reviewed and accepted as funds are available.

Environment

Environmental Protection Agency releases guidelines for the Clean and Drinking Water State Revolving Funds  

The EPA Memorandum on State Revolving Funds provides information on how the EPA will award and administer these funds, aligned with strategic goals to provide flexibility for local water needs and invest in disadvantaged communities. An EPA interactive website helps states, tribes and territories explore estimated State Revolving Funds funding and job creation.

Interior

U.S. Department of the Interior publishes Bureau of Reclamation Frequently Asked Questions (FAQs) on the Infrastructure Investment and Jobs Act funding opportunities and technical questions.

Labor

Department of Labor updates regulations to implement the Davis-Bacon Act

The Department of Labor announced proposed rulemaking by the Wage and Hour Division on the Davis-Bacon Act with goals to speed up prevailing wage updates and create efficiencies. Comments are accepted for 60 days after the rule is published in the Federal Register.

Transportation

Transportation announces funding for America’s Marine Highway Program

The America Marine Highway Program supports the development and expansion of waterways to improve supply chains. The Department of Transportation Maritime Administration announced the availability of $25 million, the largest single appropriation of funding provided in the program. Applications are due April 29.

Federal Transit Administration announces $1.5 billion in funding to modernize bus fleets and facilities

Of this funding, the Infrastructure Investment and Jobs Act is providing nearly $376 million in contract authority to the Buses and Bus Facilities program and $1.1 billion to the Low or No Emission Grant Program, including $72 million in contract authority and over $1 billion in advanced appropriations. Applications for both programs are due May 31. 

Supplementary Apportionment Tables for Fiscal Year 2022 released by Federal Highway Administration

Tables and additional details can be found here. Breakdowns of funding include sub-allocations, set-asides and limiting amounts by individual program in Tables 1 through 22. Program codes and relevant statutory references of the Fiscal Management Information System are identified. The “not to exceed 50%” transfer limit for the apportioned programs and program codes eligible for transfer are shown in Table 23.

FAQs updated regarding Transit Asset Deposition Requirements in the Infrastructure Investment and Jobs Act

The updated FAQs can be found here.

Federal Transit Administration seeks public comment on Capital Investment Grants changes

Federal Transit Administration has made three proposed changes to the Capital Investment Grants and seeks comments.

Federal Aviation Administration invites public comments

This information will be used to select airport terminal and tower program projects to be awarded discretionary grants. Comments are due April 7.

Independent Agencies

Virtual events to promote Affordable Connectivity Program hosted by Federal Communications Commission

The Federal Communications Commission and its partners are hosting locally focused events to promote broadband subsidy program enrollment.

CORONAVIRUS

General

Anniversary of the American Rescue Plan Act

COVID-19 Stafford Act assistance extended through July 1, 2022

This announcement extends 100% federal assistance for the use of the National Guard to respond to COVID-19 and the Emergency Protective Measures under Category B of the Federal Emergency Management’s Public Assistance program.

Agriculture

$97 million available for the Local Agriculture Market Program

This funding announced by the USDA is comprised of $65 million provided in ARPA and $32 million provided in the 2018 Farm Bill. Funding is available for three subprograms of the Local Agriculture Market Program:

  • Local Food Promotion Program ($43.5 million) – Applications due May 16
  • Regional Food System Partnerships ($40 million – Applications due May 16
  • Farmers Market Promotion Program ($13.5 million) – Applications due May 16

UDSA approves waiver request for Infant Formula Supply Chain Issues

The USDA is providing program flexibility for the Women, Infants, and Children (WIC) federal requirements to the requesting state to respond to supply chain challenges.

Education

ARPA materials updated by Department of Education

These updates include:

Higher education assistance fact sheets published by White House

These fact sheets include state specific ARPA funding for colleges and universities and for Historically Black Colleges and Universities (HBCUs).

Health and Human Services

Department of Health and Human Services announces $35 million for Youth Mental Health Support

The Substance Abuse and Mental Health Services Administration and the Office of Minority Health announced funding opportunities for community mental health services and suicide preventions programs through seven grant programs focused on children and young adults.

Resources to help states prepare for the expiration of COVID-19 Public Health Emergency shared by Centers for Medicare and Medicaid Services

The Public Health Emergency continues until April 16, and 60 days’ notice will be provided by the Centers for Medicare and Medicaid Services before any termination. Further details can be found here. The following resources were shared:

Letter published by Office of the Administration for Children and Families on Low Income Household Water Assistance Program Data Dashboard

The letter can be found here.

Homeland Security

Suspected fraud in Lost Wages Assistance program unreported

The Office of the Inspector General has found 38 State Workforce Agencies are not reporting fraudulent payments for Lost Wages Assistance program. The full report can be found here.

Housing

Waiver request submission deadline extended by Department of Housing and Urban Development

This deadline was changed from March 1 to April 1. Expedited processing of waivers allows public housing agencies to continually use regulatory waivers for the Public Housing and Housing Choice Voucher programs.

Reallocation of Emergency Housing Vouchers Formula provided

Housing and Urban Development provided process for reallocation of the Emergency Housing Vouchers awarded in ARPA that are returned voluntarily.

Over $2.4 million in funds to combat discrimination related to COVID-19 awarded by HUD

This funding will be distributed among 11 Fair Housing Initiative Program agencies. The press release and list of recipients can be found here.

Labor

Initial grants of over $20 million issued to promote equitable access to unemployment insurance

These initial grants will go to the District of Columbia, Oregon, Pennsylvania and Virginia.

Transportation

$2.2 billion in additional assistance announced by Federal Transit Administration

These funds were appropriated for transit agencies requiring assistance due to the economic impact of COVID-19. Funding will be given out to 35 recipients in 17 states and Washington, D.C.

Treasury

Emergency Rental Assistance updates

The Emergency Rental Assistance program makes funding available for households unable to pay rent or utilities. The program released updates:

Historic Equity Measurements for ARPA State Small Business Credit Initiative launched

The State Small Business Credit Initiative was awarded $10 billion in ARPA to provide state and tribal governments funds to provide credit support and investments to small businesses.

Further actions taken by the Treasury:

  • Issued an Interim Final Rule instituting demographic reporting requirements for those who own or run small businesses that receive loans, investments, credit or equity support or technical assistance.
  • Hosted a webinar March 9 to review the rule.
  • Updated FAQs.
  • Posted a table including initial eligible amount of incentive funding by state for businesses owned and run by socially and economically disadvantaged individuals.

Webinar on Homeowner Assistance Fund Interim Reports

Information regarding this webinar hosted by the Department of the Treasury can be found here.

Federal Reserve provides report to Congress on Outstanding Lending Facilities

Independent Agencies

$64 million in Emergency Connectivity Fund program support committed by Federal Communications Commission  

This is the 11th wave of funding for this program that helps close the Homework Gap (i.e. difference in education success between those students with access to broadband and those without it).