Program

COVID-19 Federal Assistance e311

Topics

Workforce & Economic Development

How can cities use ARP funds to expand workforce infrastructure and programs?

To be eligible to receive funds under the Coronavirus Local Fiscal Recovery Fund (“CLFRF”), any new or expanded workforce development program must directly address the negative economic impact of COVID-19.  Investments to restore or expand programs specifically designed and targeted to support job seekers who faced job loss or negative economic impacts of COVID-19 may be eligible under the economic development component of the CLFRF.[1]  Eligible uses that respond to the negative economic impacts of the public health emergency must be designed to address economic harm resulting from or exacerbated by the public health emergency. According to the U.S. Department of the Treasury’s May 10, 2021 Interim Final Rule (the “Rule”), when considering whether a program or service would be eligible under this category, the recipient should assess the extent to which there has been economic harm, such as loss of earnings or revenue, that resulted from the COVID-19 public health emergency.[2] Further, the recipient should determine whether the use would respond to or address this harm, as well as the extent to which it would do so.[3]

While economic impacts may be immediate or delayed, assistance or aid to individuals or businesses that did not experience a negative economic impact from the public health emergency would not be an eligible use under this category.[4] Additionally, general economic development or workforce development programs that are not specifically designed to address negative economic impacts from the pandemic would not be an eligible use under this category.[5] Municipalities likely would need to be able to justify and demonstrate a new or expanded workforce development program directly addressing the negative economic impact of COVID-19 in order for it to be considered an eligible use of funds under this category.[6]

The Rule notes that “rehiring public sector staff, up to pre-pandemic staffing level” is an “eligible use” of the funds.[7]

Additional examples of eligible uses outlined in the Rule include:

  • assistance to unemployed workers (e.g., job training to accelerate the rehiring of unemployed workers);
  • assistance to households (e.g., food assistance, rent, mortgage, utility assistance, counseling, and legal aid to prevent eviction or homelessness);
  • expenses to improve the efficacy of economic relief programs (e.g., improving the use of data analysis, target consumer outreach, and economic impact evaluations);
  • small businesses and nonprofits (e.g., loans, grants, or technical assistance to assist with business planning needs);
  • rehiring state, local, and tribal government staff (e.g., rehiring public sector staff, up to the pre-pandemic staffing level of the government);
  • aid to impacted industries (e.g., implementing COVID-19 mitigation and infection prevention measures to enable safe resumption of tourism, travel, and hospitality services);
  • building stronger communities through investments in housing and neighborhoods (e.g., addressing homelessness, developing affordable housing, housing vouchers, and residential counseling services).[8]

Last Revised: May 24, 2021

 

[1] Coronavirus State and Local Fiscal Recovery Funds Frequently Asked Questions, at 4, https://home.treasury.gov/system/files/136/SLFRPFAQ.pdf.

[2] U.S. Department of the Treasury Coronavirus State and Local Fiscal Recovery Funds Interim Final Rule, 31 CFR Part 35 RIN 1505-AC77, at 10, https://home.treasury.gov/system/files/136/FRF-Interim-Final-Rule.pdf; see also Coronavirus State and Local Fiscal Recovery Funds Frequently Asked Questions, at 5, https://home.treasury.gov/system/files/136/SLFRPFAQ.pdf.

[3] U.S. Department of the Treasury Coronavirus State and Local Fiscal Recovery Funds Interim Final Rule, 31 CFR Part 35 RIN 1505-AC77, at 10, https://home.treasury.gov/system/files/136/FRF-Interim-Final-Rule.pdf; see also Coronavirus State and Local Fiscal Recovery Funds Frequently Asked Questions, at 5, https://home.treasury.gov/system/files/136/SLFRPFAQ.pdf.

[4] Id. at 4.

[5] Id.

[6] U.S. Department of the Treasury Coronavirus State and Local Fiscal Recovery Funds Interim Final Rule, 31 CFR Part 35 RIN 1505-AC77, at 27-29, https://home.treasury.gov/system/files/136/FRF-Interim-Final-Rule.pdf.

[7] Id. at 36.

[8] U.S. Department of the Treasury Coronavirus State and Local Fiscal Recovery Funds Interim Final Rule, 31 CFR Part 35 RIN 1505-AC77, at 32-39, https://home.treasury.gov/system/files/136/FRF-Interim-Final-Rule.pdf.