On Monday, May 10, 2021, the U.S. Department of Treasury released details and funding on the state and local government fiscal relief that was included in the March COVID-19 relief legislation.

 

The $350 billion in relief is divided into the following: States & District of Columbia $195.3 billion; Counties $65.1 billion; Metropolitan Cites $45.6 billion; Tribal Governments $20.0 billion; Territories $4.5; billion and Non-Entitlement Units of Local Government (smaller cities) $19.5 billion.

 

The memo details the five broad ways state and local governments can use the funds. They include: Supporting public health expenditures; Addressing negative economic impacts caused by the public health emergency; Replacing lost public sector revenue; Providing premium pay for essential workers; and Investing in water, sewer, and broadband infrastructure. There is further detail and examples of spending in each of the areas. The memo also reiterates language in the relief package that prohibits the use of funding for either directly or indirectly offsetting a reduction in net tax revenue due to a change in law from March 3, 2021, through the last day of the fiscal year (September 30, 2021) or use of funding to make a deposit to a pension fund.