ProgramCOVID-19 Federal Assistance e311
Funding SourceAmerican Rescue Plan Act
Do the federal procurement provisions in the Uniform Guidance apply to uses funded by interest earned on CSLFRF funds?
The U.S. Department of the Treasury (“Treasury”) administers the Coronavirus State and Local Fiscal Recovery Funds (“CSLFRF”). According to Treasury’s CSLFRF Frequently Asked Questions document (“FAQ”):
[C]SLFRF payments made by Treasury to states, territories, and the District of Columbia are not subject to the requirement of the Cash Management Improvement Act and Treasury’s implementing regulations at 31 CFR Part 205 to remit interest to Treasury. [C]SLFRF payments made by Treasury to local governments and Tribes are not subject to the requirements of 2 CFR 200.305(b)(8) and (9) to maintain [C]SLFRF award funds in an interest-bearing account and remit interest earned above $500 on such payments to Treasury. Moreover, interest earned on [C]SLFRF award funds is not subject to program restrictions. Finally, states may retain interest on payments made by Treasury to the state for distribution to NEUs that is earned before funds are distributed to NEUs, provided that the state adheres to the statutory requirements and Treasury’s guidance regarding the distribution of funds to NEUs. Such interest is also not subject to program restrictions.
In addition, Treasury’s CSLFRF Compliance and Reporting Guidance states:
[C]SLFRF payments made to recipients are not subject to the requirements of the Cash Management Improvement Act and Treasury’s implementing regulations at 31 CFR Part 205 or 2 CFR 200.305(b)(8)-(9). As such, recipients can place funds in interest-bearing accounts, do not need to remit interest to Treasury, and are not limited to using that interest for eligible uses under the [C]SLFRF award.
However, Treasury has not advised as to whether or not the federal procurement provisions under 2 CFR Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (the “Uniform Guidance”) apply to interest earned on CSLFRF award funds. Furthermore, the federal procurement provisions outlined in the Uniform Guidance at 2 CFR Part 200.317 indicate that “all other non-Federal entities, including subrecipients of a State, must comply with procurement standards in §200.318 to 200.327.”
Accordingly, to ensure compliance with local laws, rules, and regulations, municipalities should consider applying the Uniform Guidance’s federal procurement provisions, as well as their municipal guidelines on procurement requirements, to uses funded by interest earned on CSLFRF.
Last Updated: May 16, 2022
 Coronavirus State and Local Fiscal Recovery Funds, Frequently Asked Questions (as of April 27, 2022) – FAQ #10.1, at 41 (emphasis added), available at: https://home.treasury.gov/system/files/136/SLFRF-Final-Rule-FAQ.pdf.
 Department of Treasury, Coronavirus State and Local Fiscal Recovery Funds Guidance on Recipient Compliance and Reporting Responsibilities (as of February 28,2022), Version 3.0, at 9 (emphasis added), available at: https://home.treasury.gov/system/files/136/SLFRF-Compliance-and-Reporting-Guidance.pdf.
 2 CFR § 200.317, Procurement by states (emphasis added), available at: https://www.ecfr.gov/current/title-2/subtitle-A/chapter-II/part-200/subpart-D/subject-group-ECFR45ddd4419ad436d/section-200.317.