This page contains guidance on the compliance and reporting requirements for the ARPA State and Local Fiscal Recovery Funds (SLFRF), covering topics such as the obligation of funds, subrecipients, changes to contracts after 2024, personnel costs, interagency agreements, interest earned from SLFRF investments, and more. Be sure to reference the source FAQ and guidance directly from the US Treasury, and consult your city attorney on matters specific to your city’s ARPA investments.
Click here to download the GMA Fall 2024 ARPA Handout
FAQs
GMA has compiled these Frequently Asked Questions to provide quick answers to your ARPA questions. Most answers will reference the US Treasury SLFRF Final Rule FAQs. Always consult the source for a full and detailed response. GMA will update this page as questions continue to arise.
What is meant by “incurring an obligation”?
An order placed for property and services and entering into contracts, subawards, and similar transactions that require payment. (31 CFR 35.3 or FAQ 13.17)
Refer to section 17 of the SLFRF Final Rule FAQs for the latest information on the Obligation IFR and meeting the Obligation Deadline.
May a recipient use SLFRF funds to cover personnel costs between January 1, 2025, and December 31, 2026?
Yes, to the extent the employee is serving in a position that was established and filled prior to December 31, 2024. Personnel costs for this purpose include all salary and wages, covered benefits, and payroll taxes for such positions, as in effect at the time of payment. (FAQ 17.7, 17.8)
What sort of costs are considered legal and administrative costs for which funds may be used after 2024?
As a result of receiving or expending ARPA funds, your city may become subject to a federal law or regulation or a provision of the SLFRF award terms and conditions, that creates legal and administrative costs for your city. In turn, ARPA funds can be used to cover the costs of meeting:
- Reporting and compliance requirements, including subrecipient monitoring (as discussed further below);
- Single Audit costs;
- Record retention and internal control requirements;
- Property standards;
- Environmental requirements, including applicable requirements of the National Environmental Policy Act, section 106 of the National Historic Preservation Act, the Archaeological Resources Protection Act of 1979, and the Native American Graves Protection and Repatriation Act; and
- Civil rights and nondiscrimination requirements.
This is not an exhaustive list. (FAQ 17.10)
What if a project for which my city enters into a contract by 12/31/24 results in cost increases after 12/31/24?
If a contract entered into by December 31, 2024 expressly provides for change orders or contract contingencies, the recipient may use SLFRF funds to cover increased costs attributable to such change orders or contract contingencies. Such increased costs are not considered new obligations but are instead attributable to a preexisting obligation to accommodate the change or contingency. (Treasury initially did not initially permit this but has offered flexibility in response to comments and concerns from SLFRF recipients.)
Additionally, recipients 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 incurred by December 31, 2024. (FAQ 17.16)
Act now: Consider possible cost increases and build contingencies into your contracts.
Can a contract my city entered into by 12/31/24 be amended or replaced after 12/31/24?
Yes, but only under one of three conditions. See Obligation Interim Final Rule (Nov. 2023) and Obligation IFR Quick Reference Guide. Treasury has not released guidance yet on how to report on contract amendments or replacements.
Act now: Anticipate and address circumstances that require having to amend or replace a contract so that any change falls “within substantially the same scope and for substantially the same purpose” as your original provisions.
Does the obligation deadline apply to subrecipients?
Subrecipients are not subject to the December 31, 2024, obligation deadline. A cost is considered to have been incurred once a recipient enters into a subaward or contract that obligates the recipient to cover that cost. Neither subrecipients nor contractors need to take additional steps to obligate SLFRF funds after entering into a subaward or contract with the recipient. (FAQ 17.18)
Individuals and organizations that received SLFRF funds as end users are considered beneficiaries and not subrecipients.
Does an interagency agreement between departments and agencies within my city’s government constitute an obligation?
Treasury considers an interagency agreement, including an agreement in the form of a memorandum of understanding (MOU), to constitute a “transaction requiring payment” similar to a contract or subaward and therefore an obligation for purposes of the SLFRF rule, if the agreement satisfies certain conditions. (FAQ 17.16)
Example of interagency agreement Treasury would consider obligation:
If a city council has appropriated a certain amount of funds for a public safety initiative to be administered by the city’s executive branch through fiscal year 2025, an agreement between the city’s Chief Executive and the city’s public safety department under which the department agrees to comply with reporting and recordkeeping requirements that facilitate the city’s compliance with SLFRF program requirements.
How do I see if and what my city has reported in previous reporting periods?
Log onto https://portal.treasury.gov/compliance and go to "My compliance reports." You must have a Login.gov account in order to access the portal. It takes two minutes to set up.
Tips for Login.gov:
- Use a mobile phone as your back-up authentication method – you will save yourself a lot of headache.
- Save your email (username) and password in a safe and easily retrievable place – think of the next person and the possibility for turnover.
- If you are creating a new Login.gov account, you may not be able to access your city’s reports because the system will not recognize you as being associated with the city. Treasury will need to give you access. Contact Claire Chan at 470-484-6705 if this is the case.
All Project and Expenditure Reporting data is publicly available here.
Act now: If you have not already, download a PDF copy of each of your previous reports to keep in your records.
How often does my city have to report?
If your city has a population below 250,000 residents and received less than $10 million, you are in Tier 5 and therefore required to submit a Project and Expenditure Report annually by April 30 every year through 2027. A majority of Georgia’s 536 cities fall into this category.
If your city has a population below 250,000 residents and received more than $10 million, you are in Tier 2 and therefore required to report quarterly.
NEUs are jurisdictions with 50,000 or fewer residents and generally must report annually. However, if you are one of the cities listed below that received more than $10 million, you must file quarterly. This changed as of April 30, 2022.
Canton, Carrollton, Chamblee, Douglasville, Duluth, Dunwoody, East Point, Kennesaw, LaGrange, Lawrenceville, Milton, Newnan, Peachtree City, Peachtree Corners, Statesboro, Stockbridge, Tucker, Woodstock
How much did my city receive?
- See allocation amounts for NEUs here (OPB)
- See allocation amounts for Tier 2 “Metro Cities” here (home.treasury.gov)
When did my city receive its ARPA funding?
The funds came in two equal amounts. Your city received the first half no sooner than May 2021 and the second in 2022, at least 12 months after the first payment.
When is the next reporting deadline?
If you file annually, your next report will be due April 30, 2025 and should cover:
- Obligations between Apr 1, 2024 – Dec 31, 2024
- Expenditures between Apr 1, 2024 – Mar 31, 2025
The portal is not expected to open until April 1.
When do I report remaining obligations from the last reporting deadline up through December 31, 2024?
Obligations incurred between April 1, 2024 (the most recent deadline for annual reporters) and December 31, 2024 (the obligation deadline) are to be reported in the April 2025 report.
What should I do until then?
- Make sure all funds are obligated by December 31, 2024
- Track expenses in a spreadsheet
- Keep a physical and digital record of everything, and store all documents in one “ARPA folder” that is accessible
- Know your Login.gov username and password to avoid delays with reporting
- Communicate how your city has invested ARPA funds for community benefit
When does my city have to obligate the funds and when do they have to be expended?
Recipients must obligate their full award by December 31, 2024 and spend it by December 31, 2026. The end of 2026 concludes the SLFRF period of performance.
What is the “revenue replacement” and “standard allowance” I keep hearing?
Treasury allows SLFRF recipients to elect a “standard allowance” of up to $10 million. For many cities, this is your entire award allocation. By electing this amount, Treasury will automatically presume it is used to make up for revenue loss, and your city in turn has streamlined reporting requirements and maximum flexibility to spend those funds. GMA strongly advises your city take the standard allowance. "Revenue replacement" funds can be spent on virtually any service traditionally provided by a government. (p.11, Overview of the 2022 Final Rule)
What does this look like for reporting?
You will be asked a Yes/No question about whether your city wishes to take the standard allowance. Say yes! You have through the April 2025 reporting period to make this election. (FAQ 3.1)
Report each project under Expenditure Category 6 (Revenue Replacement) and 6.1 Provision of Government Services – as along as the total obligations for these projects do not exceed $10 million. If you select Revenue Replacement, you should not need to report on subawards or subrecipients, nor should you need to upload any files.
What are eligible uses of ARPA funds?
- Revenue replacement for the provision of government services to the extent of the reduction in revenue due to the COVID-19 public health emergency, relative to revenues collected in the most recent fiscal year prior to the emergency
- COVID-19 expenditures or negative economic impacts of COVID-19, including assistance to small businesses, households, and hard-hit industries, and economic recovery
- Premium pay for essential workers
- Investments in water, sewer, and broadband infrastructure (GFOA)
What are ineligible uses of ARPA funds?
- Cannot offset a reduction in net tax revenue
- Cannot make deposits into pension funds
- Cannot use for debt service or to replenish financial reserves
- Other general restrictions (2022 Final Rule)
Are recipients required to remit interest earned on SLFRF payments made by Treasury?
No, and interest earned on SLFRF award funds is not subject to program restrictions. Also, interest earned on advances of Federal funds is not considered program income. (FAQ 10.1)
More Information
NLC Webinar ARPA Compliance Session 1 – Coronavirus Local Fiscal Recovery Funds Compliance: Audit Readiness
Watch the Presentation and Download the Slides (Jan. 2022)
The U.S. Treasury has stated that the Single Audit Act of 1984 and its current implementing regulation will apply to Coronavirus Local Fiscal Recovery Fund (CLFRF) awards authorized under the American Rescue Plan Act (ARPA) of 2021. Authoritative estimates are that as many as 10,000 municipalities and other organizations that were not previously required to arrange for a single audit will now be required to do so. This webinar highlights what auditors will be looking for and how municipalities with limited experience administering federal awards can prepare for the single audit process and ensure that they utilize this historic funding opportunity appropriately. Municipalities with FRF allocations are encouraged to view this session.
Contact
Please contact Claire Chan of the GMA staff at (470) 484-6705 with any questions. If you have questions or need additional information, you may also email SLFRP@treasury.gov. When you email Treasury, be sure to provide the full name of your city, state (e.g. Town of Braselton, Georgia) as well as your jurisdiction’s Tax ID Number (TIN) and/or Unique Entity ID (UEI).
Reference Links
For links to all the latest guidance from Treasury and other organizations, see Key Resources.