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Can cities re-use ARP funds if a program expense is reimbursed by FEMA?

It is extremely important for any municipality receiving federal funding to address the COVID-19 public health emergency to perform its due diligence to avoid any duplications of benefits. On July 1, 2020, the Federal Emergency Management Agency (FEMA) published a Fact Sheet entitled “Coronavirus Disease 2019 (COVID-19) Public Health Emergency: Coordinating Public Assistance (PA) and Other Sources of Federal Funding.” The Fact Sheet makes clear that funding to multiple federal agencies in response to COVID-19 may overlap with FEMA PA for emergency protective measures.[1]

FEMA applicants will want to consider which sources of funding—Fiscal Recovery Funds, FEMA, or others—are the most appropriate to meet their needs in response to the COVID-19 pandemic, subject to the purpose and eligibility requirements of each of the federal programs and funding sources.[2] FEMA will not deny a PA-eligible cost under a COVID-19 declaration solely because that cost may be eligible under another federal agency’s authorities.[3]

If an applicant applies to FEMA for PA funding and then determines it no longer wants the funding (and will instead seek funding from another federal agency), the applicant should notify FEMA as soon as possible.[4] In addition, applicants should notify FEMA by withdrawing or amending their PA project application if funding has not been awarded yet or request an updated version to amend their PA project if funding has been awarded.[5] All federal agencies are prohibited by Section 312 of the Stafford Act from paying SLTTs for the same work twice, and all recipients and subrecipients are responsible for ensuring this.[6]

Conversely, a municipality should not pursue FEMA funding for a cost that has already been attributed to Fiscal Recovery Funds. As stated previously, recipients and subrecipients are ultimately responsible for ensuring that they do not accept payment for the same item of work twice. FEMA applicants must certify in the PA application process that assistance is not being duplicated. Indeed, FEMA explicitly states that, when discussing Eligible Emergency Protective Measures for COVID-19, they will not duplicate assistance provided by federal agencies.[7]

FEMA may revise its position in cases where the non-federal cost share is adjusted, or if the rules for eligibility have changed. However, in light of the recent disbursement of Fiscal Recovery Funds, it is reasonable to assume that FEMA will not issue any such changes in the near future.

Last Revised: June 11, 2021

[1] FEMA FACT SHEET: Coronavirus Disease 2019 (COVID-19) Public Health Emergency: Coordinating Public Assistance and Other Sources of Federal Funding, available at https://www.fema.gov/sites/default/files/2020-07/FEMA-COVID-19_coordinating-public-assistance-and-other-sources-of-federal-funding_07-01-2020.pdf

[2] Id.

[3] Id.

[4] Id.

[5] Id.

[6] ROBERT T. STAFFORD DISASTER RELIEF AND EMERGENCY ASSISTANCE ACT [Public Law 93–288; Approved May 22, 1974] [As Amended Through P.L. 116–284, Enacted January 1, 2021], available at https://www.govinfo.gov/content/pkg/COMPS-2977/pdf/COMPS-2977.pdf

FEMA FACT SHEET: Coronavirus Disease 2019 (COVID-19) Public Health Emergency: Coordinating Public Assistance and Other Sources of Federal Funding, available at https://www.fema.gov/sites/default/files/2020-07/FEMA-COVID-19_coordinating-public-assistance-and-other-sources-of-federal-funding_07-01-2020.pdf

[7] FEMA FACT SHEET: Eligible Emergency Protective Measures, accessed at https://www.fema.gov/fact-sheet/eligible-emergency-protective-measures