What is the American Rescue Plan Act?

Among the many governmental challenges during the COVID-19 crisis, loss of revenue and the necessary transition to remote operations have been two of the most common. Additionally, recruiting and retaining quality government workers is a greater challenge than it ever has been. In response to these ongoing issues, the $1.9 trillion American Rescue Plan Act (ARPA) of 2021 includes $350 billion in State and Local Fiscal Recovery Funds (SLFRF) for state, local, territorial, and tribal governments.The most likely sources providing funding for technology are SLFRF categories that support replacing lost public sector revenue, responding to the far-reaching public health and negative economic impacts of the pandemic, and the modernization of cybersecurity (hardware, software, and protection of critical infrastructure).

For technology projects, a very relevant path for funding is likely to be what Treasury has earmarked to replace lost revenue. For local, regional, and tribal governments, a certain flexibility exists in how these replacement funds may be used. The broad guideline is that local governments may use replacement funds to pay for activities that fall under their definition of ‘government services’ in “an amount equal to the revenue loss experienced by the recipient due” to the pandemic. The amount of funding to replace lost revenue can be realized by a standard allowance of up to $10 million or more for certain claims.

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