The U.S. Department of the Treasury released an updated set of Frequently Asked Questions regarding the ARPA State and Local Fiscal Recovery Fund (SLFRF) on March 29. This FAQ document is available on Treasury’s website at this link. As cataloged in the tracking chart at the beginning of the FAQ document, the March 29 edition includes a set of new FAQs that respond to issues regarding the statutory requirements to obligate funds by December 31, 2024, and expend funds by December 31, 2026, as well as updates to several FAQs included in an earlier version of the document.
NACo will be hosting a webinar on April 12 on this updated guidance; registration is available at this link.
Key provisions in the updated FAQs include the following:
- Clarification that recipients may use SLFRF funds to cover personnel costs between January 1, 2025, and December 31, 2026, to the extent that an employee is serving in a position that was established and filled prior to December 31, 2024, assuming that the use of funds falls within the scope of an eligible use of SLFRF.
- An explanation of the procedure required for recipients to report to Treasury their estimated amount of SLFRF funds to be used to cover personnel costs between January 1, 2025, and December 31, 2026. FAQ 17.8 explains that a recipient must determine the amount of funds it estimates it will use to cover such costs, document a reasonable justification for this estimate, report that amount to Treasury by January 31, 2025 (for quarterly reporters), or by April 30, 2025 (for annual reporters), and report at award closeout the final amount expended for these costs.
- Clarification of the circumstances under which a recipient may use SLFRF to cover cost increases under a contract entered into by December 31, 2024. FAQ 17.16 explains that a recipient may use SLFRF funds to cover increased costs attributable to change orders or contract contingencies in a contract entered into by December 31, 2024, that expressly provides for change orders or contract contingencies, and may cover the cost of amendments to contracts if the amended contract is within substantially the same scope and for substantially the same purpose as the contract that was entered into by December 31, 2024.
- Explanation of circumstances under which a recipient may use SLFRF funds after December 31, 2024, that were initially obligated but ultimately not expended for an eligible activity.
Treasury has also posted an updated Project and Expenditure Report User Guide to assist in completing and submitting Project and Expenditure Reports, which are due April 30, 2024. Additional resources may be found at Treasury’s Reporting and Compliance page, which may be found at this link.
VACo encourages counties to continue to work toward obligating their funds in advance of the deadline. The degree to which states and localities had obligated and expended their SLFRF allocations was the subject of a recent Government Accountability Office report (available at this link).
VACo Contact: Katie Boyle