In the four years since its passage, the impact of the American Rescue Plan Act (ARPA) on America’s local communities cannot be overstated. ARPA’s State and Local Fiscal Recovery Fund (SLFRF) provided integral relief for local governments to ensure stability for their communities and residents throughout the COVID-19 pandemic and beyond. The SLFRF program provided many opportunities for regional and multi-jurisdictional collaborations while giving local governments autonomy to tailor expenditures to their own community’s top priorities, especially through the Treasury’s revenue replacement process.
NLC’s successful Cities are Essential campaign made the case that local government cuts to employment and services stemming from COVID-era revenue declines would drastically impact the people who live and work in cities and towns. Not only that, but overall spending reductions by local governments collectively would also have impeded economic growth at a national scale. Emergency federal relief delivered to all local governments in the form of revenue replacement allowed cities and towns to continue operating at high levels despite significant economic uncertainty that, if not for SLFRF grants, would have resulted in significant cutbacks.
Now that the December 2024 obligation deadline has passed, municipalities have until December 2026 to spend the dollars. Localities can use NLC resources to prepare for their upcoming quarterly and annual reporting deadlines.
This blog highlights two communities that used revenue replacement to fill gaps in the city’s general fund to support delivery of critical services for their residents ensuring they both obligated and spent all their funds well before the deadlines. Local governments that used other Treasury expenditure categories can see peer municipalities that are continuing to spend their SLFRF dollars in preparation for December 2026.
If your city has not finished spending down SLFRF dollars, see our blog Cities and Towns Navigate the 2026 SLFRF Spending Deadline for more information.
Community Spotlight – Anaheim, CA
Anaheim, home to over 340,000 residents, received a more than $106 million allocation through the SLFRF program as a consolidated city county government. When the COVID-19 pandemic hit, the shutdown of Anaheim’s tourism-centric economy devastated the city’s general fund. About 60 percent of Anaheim’s general fund comes from sales and hotel taxes that are fueled by the 25 million tourists that visit every year. City Manager Jim Vanderpool said it was a “no brainer” for the city to obligate and spend their ARPA funds immediately using revenue replacement to support critical local services in an interview with NLC staff.
The flexible nature of ARPA funds allowed Anaheim to act quickly when faced with a sudden loss of revenue when resorts and parks shut down. ARPA funds and borrowing meant the city did not have to lay off employees and could maintain city services at the same pre-pandemic level. Beyond maintenance of staff, city staff were also able to support vaccination efforts to support community and economic recovery. Anaheim’s unique COVID-recovery needs response demonstrates ways a quick obligation and spending process can be essential and impactful during times of uncertainty.
Community Spotlight – Rowland, NC
Rowland, home to over 1,900 residents, received a more than $300,000 allocation through the SLFRF program as a consolidated city government. For Rowland, ARPA meant that the city could finally address overdue critical infrastructure upgrades that the town previously did not have the budget to repair. Mayor Robert McDougald said “We’re a small town, but we care a lot about the quality of life for our citizens.” To prioritize improved quality of life, the town obligated and spent their ARPA funds on one-time infrastructure improvements that would directly impact the health and safety of residents.
Despite Rowland being a small town that does not usually receive federal funds, the town found the obligation and spending process seamless. Since the town knew they wanted to use the funds to address infrastructure upgrades, they prioritized projects based on what was the most needed and what infrastructure was in the most disrepair. Rowland repaired roads and drains and got their public works director a new vehicle to replace one that was on its last legs. In support of the North Carolina Department of Environmental Quality, the town cleaned up their local landfill to comply with state requirements. These ARPA-funded updates allowed the town to improve the quality of life for residents.
Additional Support
ARPA’s landmark legislation envisioned a role for all of America’s elected officials — at the federal, state and local levels — in the nation’s continued recovery from the COVID-19 pandemic. As this next stage of the program continues, localities can look to Treasury’s guidance for reporting and compliance.
Local Government ARPA Investment Tracker
Continue to explore how localities have invested their funds.
National League of Cities Resource Library
Continue to check NLC’s Resource Library to see the incoming federal funding blogs.
National League of Cities ARPA Page
View blogs related to the ARPA’s State and Local Fiscal Recovery Fund program.
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