American Rescue Plan Act – Fiscal Recovery Funds for Non-entitlement UGLGs

In May 2021, the U.S. Department of Treasury released guidance on $350 billion approved for state and local governments under the American Rescue Plan Act (ARPA).  Non-entitlement units of general local government (NEUs) will receive $19.5 billion as part of the state and local fiscal recovery funds.  NEUs will receive funds from their respective states.  

Further details are available on Treasury’s State and Local Fiscal Recovery Funds page.  

Treasury will release further guidance on distributions to NEUs soon.


Local governments not included on the list of Metropolitan allocations may be considered NEUs.  States will be allocated funds from Treasury to distribute to NEUs.  States will distribute funds based on the population of each local government in the non-metro areas.

Eligible Activities

  • Support public health ex. COVID-19 mitigation, behavioral healthcare, & public health and safety staff
  • Address negative economic impacts of the public health emergency ex. mitigate economic harm to workers, households, & businesses
  • Replace public sector revenue in restoring government services lost due to revenue decline from the pandemic
  • Provide premium pay for essential workers
  • Develop water, sewer, and broadband infrastructure


NEUs are required to report annually on expenditures.  Reports are due October 31 for the annual period ending September 30.  Further reporting will be required each year with same end date and reporting deadline.  Reports are to include the following information:

  • Financial data
  • Information on contracts and sub-awards over $50,000
  • Types of projects funded
  • Other information regarding a recipient’s utilization of award funds

Financial and supporting documents must be kept for five years following expenditure of funds.

Most provisions of Uniform Guidance (2 CFR 200) are applicable to funds.  Grant recipients should refer to the Assistance Living for specific provisions which do not apply available on 

Ineligible Activities

The following uses of funds are prohibited:

  • Pension contributions (extraordinary payment towards an accrued, unfunded liability)
  • Budget stabilization, rainy day fund, or similar reserve account
  • General economic development and workforce training – unless tied to the public health emergency
  • Infrastructure other than water, sewer, and broadband unless tied to the public health emergency
  • Principal and interest on outstanding debt
  • Non-federal match to other federal funds (as directed by limitations under other federal programs)