HOUGHTON — On March 11, 2021, President Joseph Biden signed the American Rescue Plan Act (ARPA) into law. The $1.9 trillion law is intended to provide far-reaching relief from the economic and other repercussions of the ongoing COVID-19 pandemic. In addition to funding for testing, contact tracing, vaccinations, education, and state and local governments, the ARPA includes extensive relief that could directly impact people’s finances.

An April 15 release from Invest UP states that a number of ARPA provisions relate directly or indirectly to economic development and community development interests in the Upper Peninsula. Below is a very brief summary of these provisions:

A total of $10.1 billion was allocated to the State of Michigan as “State and Local Recovery Funds.” Of that total:

– $4.4 billion is dedicated to local units of government, of which $87.4 million was allocated to local units of government in the Upper Peninsula, with very broad parameters on how that money can be spent, as outlined below.

– $5.6 billion is dedicated to the State, which remains unallocated and will require legislative action to allocate.

The state was also allocated $3.7 billion in Elementary and Secondary Emergency School Relief Funds (ESSER), the release states. Of that, $61.5 million was dedicated to Upper Peninsula Schools. The Upper Peninsula will receive a total of $148.9 million (1.8%) of the State and Local Recovery Funds and the Elementary and Secondary School Relief Funds that have been allocated so far.

While the Department of Treasury is currently promulgating rules to further guide how this money can be spent by local governments, the Act provides that State and Local Recovery Funds may be used to:

Respond to the COVID-19 public health emergency, including assistance to households, small businesses, nonprofits, and aid to affected industries;

– To pay essential government workers during the public health emergency.

– To provide grants to employers with employees who perform essential work.

– To replace State and local government revenue to the extent that they are lower than revenues in fiscal year 2018-19.

– To invest in water, sewer, or broadband infrastructure.

Foster Swift Municipal Law News states that funds distributed under ARPA can also be used for:

• Economic Assistance to Businesses and Households Affected by COVID

– To respond to COVID-19 or its negative economic impacts including assistance to households, small businesses, and non-profits or to aid impacted industries such as tourism, travel, and hospitality.

• Economic Assistance to Municipal Employees/Contractors

– To respond to workers performing essential work during COVID-19 by providing premium pay to eligible workers (workers needed to maintain continuity of operations of essential critical infrastructure sectors) of the municipality that are performing such essential work or providing grants to eligible employers that have eligible workers who perform essential work.

“Premium pay” means up to $13/hour in addition to wages or remuneration that the eligible worker otherwise receives up to $25,000 per worker.

• Provision of Government Services

– For the provision of government services to the extent of the reduction of revenue of the municipality due to COVID-19 relative to the revenues collected in the most recent full fiscal year of the municipality prior to the state of emergency.

• Water, Sewer Broadband Infrastructure

– To make necessary investments in water, sewer, or broadband infrastructure.

While many in Lansing have advocated that federal relief money should be used to pay down the state’s pension debt, the Act clearly states that the funding cannot be used for deposits on pension funds, or anything not specified above.

The money, according the Act, can be transferred to any of the following entities:

Can the money be transferred to another entity?

– A private non-profit (pursuant to the McKinney-Vento Homeless Assistance Act, 42 USC 11360(17)),

– A Private Non-Profit Organization” is defined as an organization:

(A) no part of the net earnings of which inures to the benefit of any member, founder, contributor, or individual;

(B) that has a voluntary board;

(C) that has an accounting system, or has designated a fiscal agent in accordance with requirements established by the Secretary; and

(D) that practices nondiscrimination in the provision of assistance.

– A public benefit corporation involved in the transportation of passengers or cargo,

– A special-purpose unit of a state or local government,

– The state of Michigan.