Recognizing the importance of The American Rescue Plan Act of 2021 (ARPA), our colleague, attorney Timothy Horstmann, wrote the first article in this series titled “The American Rescue Plan Act of 2021. Here’s What to Expect” in April 2021 and in July 2021 he penned an article titled “ARPA Windfall: What May Pa. and Its Municipalities Do With This Money?” Adding to this series, we will now discuss what to expect in an ARPA audit. This article will focus on Pennsylvania’s $13,450,275,500.40 portion of the $350 billion Coronavirus State and Local Fiscal Recovery Funds Program (CSLFRF), which is the specific program under ARPA that provides new funding to tribal governments, states, territories and local governments across the United States to aid in their recovery from the COVID-19 pandemic.

Local governments in Pennsylvania have received their first tranche of funds—consisting, in most cases, of 50% of those available—from ARPA and should expect to receive their second tranche of funds in no later than 2022. Consistent with the purpose and goals of ARPA and CSLFRF, municipalities in the commonwealth of Pennsylvania are already busily making plans and spending their funds. One important factor that may be overlooked when municipalities are determining how to spend those funds: accounting for and factoring in the cost associated with the requisite record trail the federal government requires state and local governments to maintain to ensure the funds are being utilized in a reasonable and efficient manner.