Treasury Releases ARPA Non-Entitlement Guidance

The U.S. Department of the Treasury released on Monday additional information for non-entitlement cities related to the American Rescue Plan Act (ARPA). The new web page features additional information on how these cities apply for funding through the states, provides regulatory documents, and answers additional frequently asked questions (FAQs).

Kentucky non-entitlement cities – dubbed “non-entitlement units of local government” (NEUs) by the act – will receive their first round of funding through the Department for Local Government (DLG) as early as June 9, 2021. However, DLG may request a 30-day extension if state officials cannot distribute the funds within 30 days of receiving the state’s allocation, so initial payments will likely come after June 9.

Treasury classifies all Kentucky cities other than Ashland, Bowling Green, Covington, Elizabethtown, Henderson, Hopkinsville, Lexington, Louisville, and Owensboro as NEUs. The new guidance provides more information on how states will distribute funds to NEUs and what cities will need to report.

Once DLG opens the application window, non-entitlement cities will submit the following to DLG to access the first tranche (half of the city’s total allocation) of funding:

  1. City name, federal taxpayer identification number (EIN), DUNS number, and address;
  2. Authorized representative (chief executive of the city) name, title, and email;
  3. Contact person name, title, phone, and email;
  4. Financial institution information, such as routing number, account number, institution name, and contact information;
  5. Total annual budget in effect as of January 27, 2020;
  6. Award terms and conditions agreement; and
  7. Assurances of compliance with Title VI of the Civil Rights Act of 1964.

DLG has already requested information regarding the city’s Fiscal Year 2020 budget, DUNS number, SAM registration number, federal tax number, and some contact information. Cities need to return the budget certification document as soon as possible. Information on that form will help DLG process applications more quickly.

The new guidelines outline how a non-entitlement city can refuse ARPA funds. If a city does not want to access the funding, the NEU can provide notice to DLG that the city declines its funding allocation. Treasury will only exempt a city from the reporting requirements if the city cancels the award. For any allocations not distributed – both from cancellations and unresponsive cities – the state may provide supplemental allocations to the cities that initially requested funding.

Non-entitlement cities must submit their first report by October 31, 2021, covering the period from award date to September 31, 2021. The report must include the city’s NEU recipient number assigned by DLG and copies of the signed award terms and conditions agreement, signed assurances of compliance with Title VI of the Civil Rights Act, and FY 2020 budget documents. Treasury will provide forms to complete prior to the reporting deadline.

Updated FAQs now allow cities to use ARPA funds to operate a vaccine incentive program. These can include programs that provide lottery tickets, cash, in­-kind assistance, or other incentives to increase vaccination rates. Cities must ensure the costs of the incentive program are reasonably proportional to the expected public health benefit.

Go the KLC American Rescue Plan Resource Page for updated documents and forms.