Ensure your team is ready for ARPA reporting

In April, the US Treasury will open the portal for reporting on American Rescue Plan Act (ARPA) expenditures that took place between April 1, 2023, and March 31, 2024, and the report is due on April 30, 2024 (for local governments with a population below 250,000 and were allocated less than $10 million). Each local government that received ARPA dollars needs to log in and complete this report, even if they reported all of their funds as spent during the last reporting periods. To complete the report, you will need to access the US Treasury portal (link provided at the bottom of this email) and provide the following:

1. Total expenditures spent and obligated between April 1, 2023, to March 31, 2024.
2. Description of what the funds are being used for (see example below).

Note: If you elected to report under Revenue Loss (Expenditure Category 6.1), you do not need to report separate projects, although some local governments may choose to for transparency or internal project tracking reasons.

Example description of fund use

Revenue replacement funds are being used to maintain current levels of services of the local government, including the salaries of three firefighters and the related operations and maintenance fees associated with the department’s emergency vehicles. Additional funds were used to maintain and service street lamps in the downtown area, as we as a project to rebuild the sidewalks of the commercial district.

Many local governments elected to take the standard allowance but have not yet reported their qualified expenses under this provision. Examples of qualifying expenses are shown below.  Local governments that elect the standard allowance under the Revenue Loss provision, are still required to report their qualified expenses. If your local government reported all of the ARPA funding as spent on a prior return, you will still need to complete the report and enter $0 of obligations and $0 expense for the current period. These funds must be spent or obligated by December 31, 2024, and be completely spent by December 31, 2026.

The following excerpt is from the League of MN Cities ARPA FAQs, Q22, and describes what the standard allowance can be used for: 

Recipients may use ARPA funds on government services up to the revenue loss amount, whether that be the standard allowance amount, or the amount calculated using the formula approach. Government services generally include any service traditionally provided by a government unless Treasury has stated otherwise. Here are some common examples, although this list is not exhaustive:

• • Road building and maintenance, and other infrastructure
  • Health services
  • General government administration, staff, and administrative facilities
  • Environmental remediation
  • Provision of police, fire, and other public safety services (including purchase of fire trucks and police vehicles)

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Government services are the most flexible eligible use category under the ARPA program, and funds are subject to streamlined reporting and compliance requirements. Recipients should be mindful that certain restrictions, which apply to all uses of funds, apply to government services as well. These restrictions include deposits into pension funds, debt service, replenishing financial reserves, settlements and judgments, or any projects that conflicts with or contravenes the purpose of the American Rescue Plan Act.

You can get ahead of the reporting process by ensuring that the appropriate people have access to the US Treasury’s portal (see the link below) and consider if there have been staff changes in the last year.  This can be a time-consuming process, so it is important to get started now while there is still time to work through questions and challenges.

As always, our team here at Abdo is available to assist your local government with the ARPA reporting requirements. Please reach out if you’d like additional assistance.

Additional guidance and resources for filing your local government’s report

• US Treasury’s portal (to complete the report)
• League of MN Cities ARPA reporting help
• US Treasury Project and Expenditure Report User Guide
• US Treasury Home Page for ARPA Reporting Information (Includes log-in instructions, reporting guides, and previously recorded webinars)
• US Treasury Final Rule FAQ