In March 2021, Congress passed the $1.9 trillion American Rescue Plan Act (ARPA). ARPA delivered resources to mount a public health response to COVID-19; directed economic relief to workers, families, and small businesses; and provided fiscal aid to state, local, and tribal governments through the $350 billion Coronavirus State and Local Fiscal Recovery Funds (SLFRF) program. For local governments, which received $130 billion, the SLFRF program provided an unprecedented amount of funding alongside considerable flexibility to address both the acute effects of the COVID-19 crisis and the long-standing local challenges that exacerbated the impacts of the crisis on economically disadvantaged communities. The Department of the Treasury set deadlines for SLFRF dollars to be obligated by December 31, 2024 and spent by December 31, 2026.

To mark ARPA’s two-year anniversary, this report examines how local governments utilized the SLFRF program to spur an equitable economic recovery. Over the past two years, our organizations—Brookings Metro, Accelerator For America (AFA), and the National Association of Counties (NACo)—have been tracking ARPA implementation and working with local leaders in cities and counties across the nation on how to best deploy their SLFRF allocations. These on-the-ground engagements yielded considerable insights on how local governments navigated the complexities of ARPA implementation. Building on those applied projects, in early 2023, we conducted in-depth interviews with local decisionmakers in 17 cities and counties to explore how they engaged community stakeholders, established recovery priorities, developed strategic investments, and monitored and evaluated ARPA’s early impacts.

Three major findings emerged from this research, each corresponding to a key phase of ARPA planning and implementation within local governments:

  • Local government leaders set priorities for local recovery, which were influenced by regulatory and political uncertainty, strategic continuity, and community engagement. In spring 2021, city and county officials were still very much in crisis mode, yet most all recognized the strategic importance of the SLFRF allocations they were about to receive. Confronted with this balance of crisis management and longer-term strategic planning, localities have been impressively entrepreneurial and innovative in setting priorities for SLFRF dollars in ways that drive greater inclusion and equity in their communities. Local leaders arrived at these priorities amid considerable uncertainty in the SLFRF rulemaking process and broader political debates in their communities. Some local governments established strategic priorities for ARPA investments based on pre-existing strategic plans, while others used the crisis to forge new or refreshed visions. Finally, community engagement in priority-setting was possible but not universal, and its degree differed from place to place.
  • Local governments pursued “dual-track” investment strategies, using the SLFRF program to both implement emergency relief and government stabilization measures as well as invest in rebuilding a more equitable economy. When the federal government allocated the first tranche of SLFRF dollars in spring 2021, local health and fiscal conditions necessitated that many local governments use the resources to invest in three key pillars—government operations, public health, and community aid—that would stabilize communities and local government. This first track (investments to rescue the economy) was followed by a second track focused on rebuilding the economy on a stronger, more inclusive foundation via investments in workforce, small businesses, housing, infrastructure, and neighborhood revitalization. Ultimately, well-designed approaches shared three characteristics. First, they were inclusive in their design—targeting historically disadvantaged households and neighborhoods. Second, they were sustainable—primarily one-time capital investments that will deliver sustained returns over time. And third, they focused on systems-level design that leveraged additional funders and improved capacity across entire policy domain systems (e.g., workforce, small business, community development).
  • Local governments are responsible for measuring impact across a range of projects, which is forcing them to upgrade their evaluation and tracking capabilities. One concern in implementing the SLFRF program was whether local governments could expand their performance management systems to track obligated and expended funds, assess outcomes, and report both pieces of information in a timely fashion to the Treasury Department. A relatively small set of local governments are investing in capacity to make the data that they report to Treasury accessible to the public at large. These online trackers and dashboards are allowing researchers, the media, and citizens to better understand the program’s early outcomes across individual projects and broader strategic domains. Given the SLFRF program’s expected impact on broad local outcomes (rather than just the outcomes reported to Treasury), some local governments are also using a more comprehensive set of indicators to track the recovery and provide critical context for their investments.

Finally, with the ARPA expenditure deadline looming, local leaders are focused on the long-term implications of SLFRF investments for their communities. This multidimensional challenge requires local leaders to sustain ARPA funding impact through a mix of strategic initiatives, existing and new complementary funding, greater cross-jurisdictional collaboration, and new impact-performance metrics. Federal agencies are key partners to local governments in ARPA funding, so enhancing flexible funding and organizing across those agencies could make a difference in ongoing implementation.

Map 1: This report draws upon interviews with 17 local governments


Related News

THE_County Countdown_working_image-4.png

County Countdown – May 20, 2024

Every other week, NACo’s County Countdown reviews top federal policy advocacy items with an eye towards counties and the intergovernmental partnership.

Image of GettyImages-1355381242.jpg

Senate Rules Committee considers elections and AI legislation ahead of 2024 General Elections

Senate Rules Committee held business meeting on May 15 to markup and consider legislation on the role of artificial intelligence in elections.

Image of GettyImages-1281545908.jpg

U.S. Senate eyes funding the Affordable Connectivity Program through broader telecommunications package

The ACP is under a short timeline to receive additional funding. After May 31, all 23 million enrolled households will cease to receive any benefit from the program. Several Senate proposals could lead to expedited passage of funding to save the program.

US Capitol

Legislation to restore advance refunding for tax-exempt municipal bonds introduced in U.S. House of Representatives

The Local Infrastructure Financing Tools (LIFT) Act would restore advance refunding of tax-exempt municipal bonds, a critical tool for county municipal finance.

US Capitol
Press Release

Local Government Leaders Urge Congress to Protect Recovery Fund Flexibility

The National Association of Counties, the National League of Cities and the Government Finance Officers Association issued a statement urging Congress to oppose a Congressional Review Act joint resolution.

THE_County Countdown_working_image-4.png

County Countdown – May 7, 2024

Every other week, NACo’s County Countdown reviews top federal policy advocacy items with an eye towards counties and the intergovernmental partnership.

Upcoming Events


Beautifying Brownfields: An Unexpected Opportunity for Your Coal Community

Join the BRECC National Network this May and learn how key federal resources can support innovative brownfield redevelopment projects in energy communities.

Cityscape divided on a highway; on the left, data is escaping to the atmosphere. On the right, data is formed into useful charts and graphs

2024’s Top Tech-tonic Shifts in Local Government

In this session, we’ll uncover research on the changes and trends affecting local governments. You’ll walk away with a better understanding of the transitions happening in 2024 and beyond. 

Harris County, Texas Commissioner Adrian Garcia describes how no zoning does not necessarily mean no problems when it comes to promoting housing affordability. Photo by Josh Reed

Robert's Rules 101: Mastering the Basics

Robert’s Rules can help you run an efficient, effective meeting – who wouldn’t want that! This virtual workshop, a part of the County Leadership Curriculum, teaches the basics of Robert's Rules and how to apply them.

Meeting attendees listen to a presenter

Global Connections for Your Local Economy Series #5: Wrap Up Discussion and NACo Resources

 If you’re ready to take your county’s economic development to the next level, join the International Economic Development Task Force throughout this Spring for a special virtual training series on how to bring jobs and capital to your community through foreign investment.

Image of financials-v2.jpg

Protected Retirement Solutions for County Employees

Employees are looking to employers for guaranteed income solutions. This workshop will focus on key strategies and solutions available to employees through 457(b) Supplemental Retirement Plans such as the Protected Retirement Solutions suite of investment products.

Image of Finance.jpg

Navigating the Future of Public Finance: 2024 Top 10 Economic Outlook Mid-Year Update- Assessing Developments and Implications

As we reach the midpoint of 2024, this webinar will explore the key insights and significant developments that have unfolded in 2024. Explore critical factors such as interest rate movements, the evolving economic landscape, inflation trends, and shifts in the role of cash as an income-generating asset.