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Federal Register/Vol. 87, No. 18/Thursday, January 27, 2022/Rules and Regulations 4431
<br /> In other words, satisfaction of a practices included in the CDC's and gender identity),religion, disability,
<br /> settlement or judgment itself is not itself guidelines and recommendations for or age,or familial status (having
<br /> an eligible use of funds,unless the stopping the spread of COVID-19. This children under the age of 18).
<br /> settlement requires the recipient to includes programs that impose a IV.Program Administration Provisions
<br /> provide services or incur other costs condition to discourage compliance
<br /> that are eligible uses of SLFRF funds. with practices in line with CDC The interim final rule included
<br /> In the final rule,Treasury is guidance (e.g.,paying off fines to several sections that described the
<br /> maintaining the interim final rule businesses incurred for violation of processes and requirements for
<br /> approach and clarifying that it applies COVID-19 vaccination or safety administering the program on an
<br /> to all eligible use categories and any use requirements), as well as programs that ongoing basis,specifically:Distribution
<br /> of funds under the SLFRF program. require households,businesses, of funds,transfer of funds,use of funds
<br /> 3. General Restrictions nonprofits,or other entities not to use for program administration,reporting on
<br /> practices in line with CDC guidance as the use of funds,and remediation and
<br /> In addition to the above restrictions, a condition of receiving funds (e.g., recoupment of funds used for ineligible
<br /> there are three general restrictions that requiring that businesses abstain from purposes.
<br /> apply to SLFRF funds. These requiring mask use or employee To enhance clarity,this
<br /> restrictions,which reflect existing laws vaccination as a condition of receiving SUPPLEMENTARY INFORMATION for the
<br /> and regulations,the Award Terms and SLFRF funds). final rule organizes these issues into one
<br /> Conditions, and application of the Second, a recipient may not use section on Program Administration
<br /> ARPA statute,applied under the interim SLFRF funds in violation of the conflict Provisions. Recipients should also
<br /> final rule, and they continue to apply of interest requirements contained in consult Treasury's Compliance and
<br /> under the final rule. the Award Terms and Conditions or the Reporting Guidance for additional
<br /> A primary purpose of the SLFRF in Office of Management and Budget's information on program administration
<br /> the ARPA is to support efforts to stop Uniform Guidance,including any self- processes and requirements,including
<br /> the spread of COVID-19.368 As dealing or violation of ethics rules. the applicability of the Uniform
<br /> discussed above,recipients of SLFRF Recipients are required to establish Guidance.
<br /> funds are required to comply with the policies and procedures to manage
<br /> 37o A.Payments in Tranches to Local
<br /> Award Terms and Conditions
<br /> potential conflicts of interest. Governments and Certain States
<br /> established for the use of such funds. Treasury may provide further guidance
<br /> The interim final rule and final rule on the types of activities or conflicts Section 602(b)(6)(A)(ii) of the Social
<br /> implement this objective by,in part, that the recipient's policies and Security Act authorizes the Secretary to
<br /> providing that recipients may use procedures must cover. withhold payment of up to 50 percent
<br /> SLFRF funds for COVID-19 mitigation Lastly,recipients should also be of the amount allocated to each state
<br /> and prevention.369 See section Public cognizant that federal,state,and local and territory for a period of up to 12
<br /> Health in Public Health and Negative laws and regulations, outside of SLFRF months from the date on which the state
<br /> Economic Impacts. program requirements,may apply. or territory provides its statutorily-
<br /> The CDC has provided Recipients may not use revenue loss required certification to the Secretary.
<br /> recommendations and guidelines to funds,for instance,to violate other The Social Security Act requires any
<br /> help mitigate and prevent COVID-19 background laws that limit the scope of such withholding be based on the
<br /> and has identified vaccines and masks activities that may be conducted as unemployment rate in the state or
<br /> as two of the best tools to prevent the �`government services,"including other territory as of the date of the
<br /> spread of COVID-19. The interim final state and federal laws. State and local certification.
<br /> rule and final rule help support procurement,contracting, and conflicts- Under the interim final rule,Treasury
<br /> recipients in stopping the spread of of-interest laws and regulations may provided that it would withhold 50
<br /> COVID-19 through these include applicable requirements, percent of the amount allocated from
<br /> recommendations and guidelines. including,for example,required any state that had an unemployment
<br /> Consistent with the purpose of the procurement processes for contractor rate less than two percentage points
<br /> ARPA and as implemented through the selection or competitive price setting. above its unemployment rate in
<br /> interim final rule and final rule, a Furthermore,recipients are also February 2020 as of the date the state
<br /> recipient may not use SLFRF funds for required to comply with other federal, submitted its initial certification for
<br /> a program, service,or capital state,and local background laws, payment of funds pursuant to section
<br /> expenditure that includes a term or 371 1
<br /> including environmental laws and 602d( )( ) of the Social Security Act.
<br /> condition that undermines efforts to
<br /> federal civil rights and Based on data available at the time of
<br /> stop the spread of COVID-19. A nondiscrimination requirements,which the issuance of the interim final rule,
<br /> program or service that imposes include prohibitions on discrimination this threshold was expected to result in
<br /> conditions on participation or on the basis of race, color,national a majority of states being paid in two
<br /> acceptance of the service that would origin, sex, (including sexual orientation tranches. Treasury did not split the
<br /> undermine efforts to stop the spread of payments of any territories.
<br /> COVID-19 or discourage compliance Public Comment:One commenter
<br /> 370 Specifically,the Award Terms and Conditions
<br /> with recommendations and guidelines provide that"[r]ecipient understands and agrees it asked Treasury to allow a state to
<br /> in CDC guidance for stopping the spread must maintain a conflict of interest policy request release of the portion of the
<br /> of COVID-19 is not a permissible use of consistent with 2 CFR 200.318(c),and that such state's second tranche payment after the
<br /> SLFRF funds. conflict-of-interest policy is applicable to each state could demonstrate that it had
<br /> In other words,recipients may not use activity funded under this award.Recipients and
<br /> funds fora program that undermines subrecipients must disclose in writing to Treasury allocated the entirety of the first
<br /> p g or the pass-through agency,as appropriate,any tranche, a need to continue ongoing
<br /> potential conflict of interest affecting the awarded programs and a desire to avoid
<br /> 3611 See Sec.602(a)(1);603(a)(1);602(c)(1); funds in accordance with 2 CFR 200.112." borrowing costs.Another commenter
<br /> 603(c)(1). 371 An exception is statutes that do not apply
<br /> 369 See 35.6(b);Coronavirus State and Local Fiscal unless explicitly stated,including,e.g.,the National asked Treasury to clarify whether states
<br /> Recovery Funds,86 FR at 26786. Environmental Policy Act and the Davis-Bacon Act. that received half their funding in the
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