As indirect recipients of the Coronavirus Local Fiscal Recovery Fund, non-entitlement units of local government, as classified by the American Rescue Plan, will receive their allocations from the State of South Carolina.
Before payments can be distributed to cities and towns, the state must first submit a request to the U.S. Department of Treasury for its allocation from the State Fiscal Recovery Fund. Doing so will prompt Treasury to simultaneously initiate payment to the Local Fiscal Recovery Fund.
South Carolina has not yet submitted its request for payment to the U.S. Department of Treasury. The Municipal Association is actively working with legislators and state agency officials regarding the receipt and distribution of ARP payments to non-entitlement units of local government. Continue to check this website for new information.
Information and guidance on the details of the ARP are evolving
The Municipal Association of SC is continuing to learn about and evaluate the ARP as the federal government releases details.
The Association recommends that municipal officials carefully review the information below and closely consult with their municipal attorneys.
The U.S. Department of Treasury has
released guidance pertaining to the use of funds. Please note that spending ARP funds on unauthorized uses could result in a city or town having to repay those funds to the federal government.
How will the money be allocated?- $45.57 billion is allocated to metropolitan cities, classified as having populations of at least 50,000.
- $19.53 billion is allocated to non-entitlement cities, classified as having populations of fewer than 50,000.
How are allocations determined?
- Grant allocations for metro cities are based on a modified Community Development Block Grant formula that uses population size, poverty rates and measures of housing instability to prioritize need.
- Grant allocations for non-entitlement cities are based on population size to prioritize simplification. Grants to non-entitlement cities cannot be greater than an amount equal to 75% of the city’s most recent pre-pandemic budget as of January 27, 2020.
When can cities and towns expect to receive funds?
- Funding will be distributed in two tranches. The first tranche will be distributed within 60 days of enactment of the law, and the second tranche will be distributed 12 months after the first tranche is paid.
- Metropolitan cities can now request their allocations from the
Treasury Submission Portal.
- Each state will receive the funding for non-entitlement cities. The states then have 30 days to disburse the funds to local governments.
- The state can request multiple 30-day extensions for distributing funds. Once an initial extension is granted, future extension requests must include a written plan specifying when the state expects to make the distribution, and the actions the state has taken and will take to make the distribution before the end of the extension.
- States have no authority to change payment amounts, or attach additional requirements on local governments to receive the funds.
Can the state refuse to distribute funds to non-entitlement cities?
No. If funds are not allocated to local governments within 120 days from the state’s receipt of them, the law contains a penalty that makes the received funds a debt of the state owed to the federal government.
What are the allowable uses for these funds?
The funds may be used to:
- Respond to the COVID-19 public health emergency or its negative economic impacts, including assistance to households, small businesses, and nonprofits, or aid to impacted industries such as tourism, travel and hospitality.
- Respond to workers performing essential work during the COVID-19 public health emergency by providing premium pay to eligible workers that are performing such essential work, or by providing grants to eligible employers that have eligible workers who perform essential work.
- Provide government services to the extent of the reduction in revenue due to the COVID-19 public health emergency relative to revenues collected in the most recent full fiscal year prior to the emergency.
- Make necessary investments in water, sewer or broadband infrastructure.
Funds may not be used to cut taxes.
Recipient governments can transfer funds to private nonprofit organizations, public benefit corporations involved in the transportation of passengers or cargo, or a special-purpose units of state or local government.
Funds can be recouped by the Treasury Department if the recipient does not comply with the eligible uses listed above.
Recipient governments must provide periodic reports to the Treasury Department with a detailed accounting of the use of funds.
Please note that the Department of Treasury has the authority to issue such regulations as may be necessary or appropriate to carry out this section.
How long does my city or town have access to the funds?
Funds must be spent by December 31, 2024.
The U.S. Department of Treasury has released steps that units of local government need to take to receive their allocation from the American Rescue Plan. These steps should be taken as soon as possible to ensure funds are received in a timely fashion.
Metropolitan cities should complete the steps below as soon as possible to ensure.
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Ensure that you have a valid DUNS number.
Issued by Dun & Bradstreet, a DUNS number is a unique nine-character number used to identify an organization. The federal government uses the DUNS number to track how federal money is allocated. A DUNS number is required prior to registering with the SAM database, which is outlined below. Registering for a DUNS number is free of charge.
If your city does not have a valid DUNS number, please visit https://fedgov.dnb.com/webform/ or call 1.866.705.5711 to begin the registration process. A DUNS number can be created in one business day.
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Ensure that you have an active SAM registration.
The System for Award Management is the official government-wide database to register with in order to do business with the U.S. government. All Federal financial assistance recipients must register on
SAM.gov and renew their SAM registration annually to maintain an active status to be eligible to receive Federal financial assistance. There is no charge to register or maintain your entity SAM registration.
If your city does not have an active SAM registration, please visit, SAM.gov to begin the entity registration or renewal process.
Please note that SAM registration can take up to three weeks; delay in registering in SAM could impact timely payment of funds.
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Gather your payment information, including:
- Entity Identification Number (EIN), name, and contact information
- Name and title of an authorized representative of your city
- Financial institution information (e.g., routing and account number, financial institution name and contact information)
Eligible Nonentitlement Units of Local Government will receive a distribution of funds from their respective state government. For nonentitlement units of local government, Treasury will allocate and pay funds to state governments, and the state will distribute funds to nonentitlement units of local government in proportion to population. Nonentitlement units must have a valid DUNS number to meet reporting requirements under the program. If your city does not have a valid DUNS number, please visit
https://fedgov.dnb.com/webform/ or call 1.866.705.5711 to begin the registration process.
The U.S. Department of the Treasury released the
Interim Final Rule* for the American Rescue Plan Act's
Coronavirus State and Local Fiscal Recovery Funds program that describes eligible uses for funding.
A quick reference to the eligible uses can be found at the
Coronavirus State and Local Fiscal Recovery Fund Quick Reference Guide.
The IFR requires states and metropolitan cities to request funding from Treasury using the
Treasury Submission Portal.
To complete a submission on behalf of your metropolitan city, you will be asked to provide the following information:
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Jurisdiction name, taxpayer ID number, DUNS Number, and address
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Authorized representative name, title, and email
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Contact person name, title, phone, and email
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Funds transfer information, including recipient's financial institution, address, phone, and routing number and account number
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Completed certification document (to be signed by the authorized representative)
Metro cities must submit a new request to receive this funding, even if it has previously used this portal to request funding from other programs. Further communications regarding the status of their submission via the email address provided in the Treasury Submission Portal.
Non-entitlement unit of local government will receive funding from the state – not the Treasury Submission Portal. Treasury expects to provide further guidance on distributions to NEUs within the next week.
Additional information for non-entitlement cities.
Local governments should expect to receive funds in two tranches, with 50% provided in May 2021 and the balance delivered 12 months later.
Please visit
https://home.treasury.gov/policy-issues/coronavirus/assistance-for-state-local-and-tribal-governments/state-and-local-fiscal-recovery-funds for complete information, including a Coronavirus State and Local Fiscal Relief Fund fact sheet and frequently asked questions.
*
The Interim Final Rule, adopted by Treasury on May 10, 2021, has been submitted to the Office of the Federal Register for publication. The document may vary slightly from the published document if minor editorial changes have been made during the OFR review process. Upon publication in the Federal Register, the regulation can be found at
www.federalregister.gov,
www.regulations.gov, and at
www.treasury.gov. The document published in the Federal Register is the official document.
Here is what has been released:
Once payment from Treasury has been received, states will have 30 days to disburse payments to NEUs unless an extension is requested.
The Municipal Association is working to understand South Carolina’s process for distributing funds to non-entitlement units of local government and will update our membership accordingly.