The U.S. Department of the Treasury recently published its final rule implementing the coronavirus state and local fiscal recovery funds (SLFRF) program established by the American Rescue Plan Act of 2021 (ARPA). The final rule adopts with amendments to the interim final rule published by the Treasury on May 17, 2021. The final rule updates the rules governing the expenditure of funds received by public entities under the program.

ARPA was signed into law on March 11, 2021, and provided $350 billion in funding to tribal governments, states, territories and local governments to combat the COVID-19 pandemic, with $220 billion going to states, territories and tribal governments and $130 billion going to local governments. Congress through passage of ARPA authorized expenditure of these funds by recipients on the following four categories of spending: public health and negative economic impacts; premium pay; revenue loss; and water, sewer, and broadband infrastructure.