Agenda - Council Work Session - 03/08/2022

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4340 Federal Register/Vol. 87, No. 18/Thursday, January 27, 2022/Rules and Regulations final rule may still be eligible in two indirectly a reduction in net tax revenue summarizing opinions expressed in ways. First,under the revenue loss resulting from a change in state or public comments. Statements using the eligible use category,recipients have territory law. term"encourage"refer to broad latitude to use funds for • For all recipients except Tribal recommendations,not requirements. government services up to their amount governments,funds may not be used for H.Eligible Uses of revenue loss due to the pandemic. A deposits into a pension fund. potential use of funds that does not fit • For all recipients,funds may not be A.Public Health and Negative within the other three eligible use used for debt service or replenishing Economic Impacts categories may be permissible as a financial reserves. • All reci must also com 1 Background ients government service,which recipients p� p Y can fund up to their amount of revenue with three general restrictions. First,a Since the first case of COVID-19 was loss.For example,transportation recipient may not use SLFRF funds for discovered in the United States in infrastructure ll enera are a program, service, or capital projects g y expenditure that conflicts with or January 2020,the disease has infected ineligible as a response to exen the public p over 50 million and killed over 800,000 health and negative economic impacts contravenes the statutory purpose of Americans.12 The disease—and of the pandemic;however,a recipient ARPA,including a program, service, or necessary measures to respond—have could fund these projects as a capital expenditure that includes a term had an immense public health and government service up to its amount of or condition that undermines efforts to economic impact on millions of revenue loss,provided that other stop the spread of COVID-19. Second, Americans across many areas of life, as restrictions on use do not apply. See recipients may not use SLFRF funds in detailed below in the respective sections sections Revenue Loss and Restrictions violation of the conflict-of-interest on Public Health and Negative on Use for further information. Second, requirements contained in the Award Economic Impacts. Since the release of the eligible use category for responding Terms and Conditions,including any the interim final rule in May 2021,the to the public health and negative self-dealing or violation of ethics rules. economic impacts of the pandemic Lastly,recipients should be aware that country has made major progress in federal, state, and local laws and fighting the disease and rebuilding the provides a non-exhaustive list of economy but faces continued risks,as enumerated eligible uses,which means regulations,outside of SLFRF program that the listed eligible uses include requirements, also apply,including for illustrated by the spread of the Delta variant and the resulting slowdown in some,but not all, of the uses of funds example, environmental laws and that could be eligible. The Eligible Uses federal civil rights and the economic recovery;The SLFRF section provides a standard for nondiscrimination requirements,which program, and Treasury's interim final include prohibitions on discrimination rule,provide substantial flexibility to determining if other uses of funds, respond recipients to d to pandemic beyond those specifically enumerated, on the basis of race, color,national p p are eligible.If a recipient would like to origin, sex(including sexual orientation impacts in their local community;this pursue a use of funds that is not and gender identity),religion, disability, flexibility is designed to help state, specifically enumerated,the recipient age, or familial status (having children local,and Tribal governments adapt to should use the standard and other under the age of 18). the evolving public health emergency guidance provided in the section Public The Program Administration and tailor their response as needs evolve Health and Negative Economic Impacts Provisions section describes the and to the particular local needs of their to assess whether the use of funds is processes and requirements for communities. eligible. administering the program on an Indeed, state,local, and Tribal Next,the Restrictions on Use section ongoing basis, specifically as relates to governments face continued needs to describes limitations on how funds may the following:Distribution of funds, respond at scale to the public health be used. Treasury has divided the timeline for using funds,transfer of emergency. This includes continued Restriction on Use section into (A) funds from a recipient to different public health efforts to slow the spread statutory restrictions under the ARPA, organizations,use of funds for program of the disease,to increase vaccination which include (1) offsetting a reduction administration,reporting on use of rates and provide vaccinations to new in net tax revenue,and (2) deposits into funds,and remediation and recoupment populations as they become eligible,to pension funds, and(B) other restrictions of funds used for ineligible purposes. Of protect individuals living in congregate on use,which include (1) debt service note, SLFRF funds may only be used for facilities, and to address the broader and replenishing reserves, (2) costs incurred within a specific time impacts of the pandemic on public settlements and judgments,and(3) period,beginning March 3, 2021,with health. Similarly,while a strong general restrictions. These restrictions all funds obligated by December 31, economic recovery is underway,the apply to all eligible use categories; 2024 and all funds spent by December economy remains 3.9 million jobs below however, some restrictions apply only 31, 2026.Recipients are advised to also its pre-pandemic level,pointing to the to certain types of recipient consult Treasury's Reporting and continued need for response efforts, governments,and recipients are advised Compliance Guidance for additional with low-income workers and to review the final rule to determine information on program administration communities of color facing elevated which restrictions apply to their type of processes and requirements, including rates of unemployment and economic government(e.g., state,territory,Tribal applicability of the Uniform Guidance. hardship.13 Long-standing disparities in government, county,metropolitan city, Finally,the section Regulatory health and economic outcomes in or nonentitlement unit of government). Analyses provides Treasury's analysis of To reiterate,for recipient governments the impacts of this rulemaking,as 12 Centers for Disease Control and Prevention, covered by a specific restriction,that required by several laws,regulations, COVID Data Tracker,http://www.covid.cdc.govl restriction applies to all eligible use and Executive Orders. covid-data-tracker/#data tracker-home(last visited categories and any use of funds under Throughout this Supplementary December 31,2021). the SLFRF program. Specifically: Information,statements using the terms 13 U.S.Bureau of Labor Statistics,All Employees, • For states and territories only, funds "should"or"must"refer to Total Nonfarm[PAYEMS]https://fred.stlouisfe,d.org/series/PAYEMS(last visited may not be used to offset directly or requirements, except when used in December 7,2021).