American Rescue Plan Update: Additional Flexibility With ARPA Flex

When Congress approved the final 2023 budget package in December through the Consolidated Appropriations Act of 2023, it contained a significant provision allowing for additional flexibility in the use of Coronavirus State and Local Fiscal Recovery Funds (SLFRF).  The following grant expenditures now eligible under this ARPA Flex provision include:

-Spending to provide emergency relief from natural disasters, including temporary emergency housing, food assistance, financial assistance for lost wages, or other immediate needs.

-Spending on transportation infrastructure eligible projects and matching funds.

-Spending on any program, project, or service that would also be eligible under HUD’s Community Development Block Grant program.

However, you should be aware this new flexibility has limitations. The amendment puts a cap on the amount a grantee can spend on the items listed above.  This cap is greater of $10 million or 30% of the total grant amount.  The amendment does not include any new spending mandates or conditions that would elevate the risk of claw back of grant funds.

The U.S. Treasury has 60 days from Congress’s passing of budget to finalize the ARPA Flex changes within SLFRF rules, which is anticipated in February.  Stay tuned for more updates.