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MANCHIN, COLLINS LEAD BIPARTISAN PUSH TO EXPAND RELIEF FUNDING USES TO INCLUDE LOCAL FUNDING MATCHES FOR FEDERAL GRANTS
Washington, DC – Today, U.S. Senators Joe Manchin (D-WV), Susan Collins (R-ME), Chris Van Hollen (D-MD), Thom Tillis (R-NC), Raphael Warnock (D-GA), Bill Cassidy (R-LA), Michael Bennet (D-CO), Chuck Grassley (R-IA), Catherine Cortez Masto (D-NV) and Roger Wicker (R-MS) called on U.S. Department of the Treasury Secretary Janet Yellen to allow local governments to use funds from the American Rescue Plan to satisfy the local match requirement for federal discretionary grant programs. The American Rescue Plan, which passed the Senate in March, has provided $350 billion in direct funding to local governments and provides flexibility on how local governments can use these funds.
The Senators said in part, “The American Rescue Plan provides direct funding to local governments across the United States. In this pandemic, many communities have done incredible work with scant resources by finding innovative ways to stretch their dollars. One way that local communities are able to stretch their dollars and federal taxpayers’ dollars most effectively is by leveraging these as matching funds for federal discretionary grant programs.”
The American Rescue Plan provides flexibility within the Fiscal Recovery Fund to allow communities to meet the unique challenges they face as a result of the COVID-19 public health emergency. In light of this flexibility, Treasury provided a broad definition of “government services” in the Interim Final Rule, specifically stating: Government services can include, but are not limited to, maintenance or pay-go funded building of infrastructure, including roads; modernization of cybersecurity, including hardware, software, and protection of critical infrastructure; health services; environmental remediation; school or educational services; and the provision of police, fire, and other public safety services.
“However, Local governments often use their revenues to satisfy the local match for federal discretionary grant programs like the U.S. Department of Agriculture’s (USDA) Water & Wastewater Disposal Grant Program, USDA’s Broadband ReConnect Program, the Economic Development Administration’s (EDA) Public Works Program, and countless others that are instrumental in providing many of the aforementioned government services. While we understand that these funds are subject to pre-existing limitations provided in other Federal statutes and regulations and may not be used as non-Federal match for other Federal programs whose statute or regulations bar the use of Federal funds to meet matching requirements, we strongly encourage Treasury to allow State and Local Fiscal Recovery Funds to be used to satisfy the local match for all other federal programs where there is not a statutory prohibition,” the Senators continued.
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