Investing State and Local Recovery Funds in Human Services Agencies

By Rachel Mackey    July 29, 2021

This is the sixth of a multi-part blog series that will take a detailed look at the American Rescue Plan and the ways in which we can leverage it to strengthen the resiliency of our public health and human services infrastructure, and, in turn, substantially move the needle on social and economic mobility so families succeed for the long run.

Read Additional Posts from the American Rescue Plan Series:
Part 1   |   Part 2   |   Part 3   |   Part 4   |   Part 5   |   Part 6   |   Part 7   |   Part 8   |   Part 9

County governments are on the front lines shaping and implementing policies and programs that help residents meet their basic needs, access employment and achieve economic independence. In fact, counties invest $58 billion in state, local and federal funds each year in human services. Throughout the COVID-19 pandemic response, these county services have been at the nexus of translating public policy into the community-driven services that are key to building a resilient and equitable future.

Passed in March 2021, the American Rescue Plan Act of 2021 (ARPA) included a new $362 billion State and Local Fiscal Recovery Fund (SLFRF) to help states, territories, counties, cities, and tribal governments cover increased expenditures, replenish lost revenue and mitigate economic harm from the COVID-19 pandemic. Of this amount, $65.1 billion in direct, flexible aid is going to every county in America via a population-based formula. The SLFRF’s historic investment in county governments represents an opportunity for local leaders to invest in and strengthen our human services systems to facilitate a robust and equitable recovery from the pandemic.

On May 10, the U.S. Department of Treasury released guidance highlighting eligible uses for SLFRF, which fall into five major categories: supporting the public health response, addressing negative economic impacts, replacing public sector revenue loss, providing premium pay to essential workers, and investing in water, sewer and broadband infrastructure. Within these allowable uses, county governments have the opportunity to make strategic investments that can build the capacity of human services programs, operations and staff to support the on-going needs of underserved communities and promote the well-being and upward mobility of all people.

Strengthening human services programs

Counties may invest funds in activities that support economic recovery among impacted residents, communities and organizations and which, in many cases, may be administered through county human services agencies. This includes direct assistance to households, including cash grants, as well as assistance to nonprofit organizations that are responding to impacts of the pandemic. The funds can also support unemployed workers through job training, public jobs programs, subsidized employment and supports such as child care and transportation assistance. Counties can also invest funds to promote healthy childhood environments and facilitate access to health and social services in communities disproportionately impacted by the pandemic, such as Qualified Census Tracts. This includes programs that assist residents with accessing or applying for public benefits or services, services for child welfare-involved families and foster youth, home visiting programs, and programs addressing housing insecurity and homelessness.

Investments in human services staff

County governments may use SLFRF dollars for payroll and covered benefit expenses for public health and safety staff, for employee’s time spent mitigating or responding to the public health emergency, including human services staff. Counties may also use funds for routine payroll contributions to pensions of employees whose wages and salaries fall under an eligible use under the guidance. The Interim Final further permits funds to be used toward the rehiring of public sector staff, including county employees, up to the pre-pandemic staffing level, which is measured based on employment as of January 27, 2020. Finally, counties may provide premium pay (including retroactively) worth up to $13/per hour to eligible workers performing essential work during the COVID-19 public health emergency, which includes state, local or tribal employees, social service and human service staff and child care workers. Importantly, the U.S. Treasury is defining essential work as regular in-person interactions or regular physical handling of items that were also handled by others; telework is not eligible under this definition.

COVID-19 mitigation in human services facilities

County governments may invest in COVID-19 mitigation in public facilities, including government buildings, homeless shelters, residential foster care facilities, group living facilities and other congregate settings.

Other government services

Counties may use Fiscal Recovery Funds to replace lost revenue and use these funds for a broad range of government services, programs and projects outside of explicit eligible uses of recovery funds under the interim rule. These include, but are not limited to, school or educational services, health services, environmental remediation, public safety services and cybersecurity.

Broadband infrastructure

The COVID-19 public health emergency has underscored the importance of universally available, high-speed, reliable and affordable broadband coverage as millions of Americans rely on the internet to access health and human services, among other vital activities such as remote school and work. Recognizing the need for such connectivity, counties may also utilize the SLFRF to make necessary investments in broadband infrastructure, with an emphasis on unserved and underserved households. Such investments may facilitate improved virtual operations within county human services programs.

To learn more about implementation of the SLFRF for county governments, including allocation levels, FAQs, an in-depth analysis of the Interim Final Rule and more, visit NACo’s COVID-19 Recovery Clearinghouse.

Read Additional Posts from the American Rescue Plan Series:
Part 1   |   Part 2   |   Part 3   |   Part 4   |   Part 5   |   Part 6   |   Part 7   |   Part 8   |   Part 9

About the Author

Rachel Mackey

Associate Legislative Director, Human Services and Education, NACo

Founded in 1935, the National Association of Counties (NACo) strengthens America’s counties, serving nearly 40,000 county elected officials and 3.6 million county employees.

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