The U.S. Department of Treasury has provided guidance on how the latest round of $350 billion in emergency funding may be used by state, local, territorial, and Tribal governments. Known as the “Coronavirus State and Local Fiscal Recovery Funds,” the goal of the relief is to support the response efforts to continue to decrease the spread of the virus and bring the pandemic under control; replace last public sector revenue to support for vital public services and help retain jobs; support immediate economic stabilization for households and businesses; and address systemic public health and economic challenges that have led to the inequal impact of the pandemic on certain populations.

The fund provides flexibility for those receiving relief, within certain guidance. Funds can be used to:

• • Support public health expenditures, such as COVID-19 mitigation efforts, behavioral healthcare, and medical expenses. Examples include vaccination programs, testing, PPE purchases, enforcement of public health orders, and enhancement of public health data systems.
  • Address negative economic impacts caused by the pandemic, including economic harms to workers, households and small businesses. Examples include job training, help small businesses with prevention and mitigation tactics, rehire public sector staff, and replenish unemployment insurance trust funds.
  • Provide government services to the extent of the reduction in revenue experienced due to the pandemic.
  • Provide premium pay for essential workers such as staff at nursing homes, farm workers, public health and safety staff, and educators.
  • Improve access to clean drinking water, support vital wastewater and stormwater infrastructure, and expand access to broadband internet.

Conversely, there are two specific ineligible uses of funds:

• • States and territories can’t use funds to directly or indirectly offset a reduction in net tax revenue due to a change in law from March 3, 2021 through the last day of the fiscal year in which the funds provided have been spent.
  • No recipient may use the funds to make a deposit into a pension fund.

To read the full fact sheet, please click here.

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