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COVID-19 Federal Assistance e311

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Lost Revenue & Revenue Replacement

Can a municipality account for a municipal airport’s lost revenue when calculating total lost revenue for the municipality under the ARP?

Yes, a municipal airport’s lost revenue can be included when calculating total lost revenue for a municipality under the American Rescue Plan Act’s (“ARP”) Coronavirus Local Fiscal Recovery Funds (“CLFRF”).

U.S. Department of Treasury (“Treasury”) guidance directs municipalities to determine which of its revenue streams fall under the definition of “general revenue,” which in turn is based on (though not identical to) the Census Bureau’s concept of “General Revenue from Own Sources” as published in the Annual Survey of State and Local Government Finances.[1]

The CLFRF Interim Final Rule (the “Rule”) defines “general revenue” as “money that is received from tax revenue, current charges, and miscellaneous general revenue...”[2] Airport revenue fits within this definition as it clearly falls under the category of “current charges.”[3]

Treasury also states that revenues from all commercial-type activities of a recipient’s government are covered by the Rule’s definition of “general revenue,” with certain exceptions, namely, operations of publicly-owned and controlled water supply systems, electric power systems, gas supply systems, and public mass transit systems.[4] Treasury specifies that commercial-type activities include revenue from airports.[5]

CLFRF Frequently Asked Question #3.14 can assist in addressing questions about whether a particular entity performing commercial-type activities can be considered a part of a recipient’s government.[6]

Last Revised: August 5, 2021

[1] Coronavirus State and Local Fiscal Recovery Funds, Frequently Asked Questions (as of July 19, 2021) – FAQ #3.1, at 13, available at: https://home.treasury.gov/system/files/136/SLFRPFAQ.pdf.

[3] Coronavirus State and Local Fiscal Recovery Funds, Frequently Asked Questions (as of July 19, 2021) – Appendix, at 42, available at: https://home.treasury.gov/system/files/136/SLFRPFAQ.pdf.

[4] Coronavirus State and Local Fiscal Recovery Funds, Frequently Asked Questions (as of July 19, 2021) – FAQ #3.15, at 18, available at: https://home.treasury.gov/system/files/136/SLFRPFAQ.pdf.

[5] Id.

[6] Id.