American Rescue Plan

Latest on ARPA in Rhode Island

As policymakers negotiate a final budget for FY2023 and institute a plan for spending the entirety of Rhode Island's American Rescue Plan Act (ARPA) State Fiscal Recovery Funds (SFRF), we find ourselves at a critical juncture. If nothing changes from the proposals in the Governor's budget, we are likely to spend the state's ARPA SFRF in a scattershot manner, funding lots of small projects but spreading the money too thinly and failing to usher in transformative or equity-centered change.

EPI drafted a report discussing four transformative and equity-centered ways to expend ARPA funds. By making bold investments in behavioral health, adult education, neighborhood trusts, and housing, state lawmakers can support Rhode Island's most beleaguered residents and make a strong statement of equity-centered change.

You can read the report and EPI's press release. Additionally, please read EPI's op-ed in the Boston Globe on how we can use the recently announced budget surplus to reinvest in long-neglected state programs and services.

Background

The American Rescue Plan Act (ARPA) of 2021, signed into law by President Biden in March, will direct close to $4 billion in assistance to Rhode Island and Rhode Islanders over the next few years. The funds, designed to provide for both short-term relief and investments in recovering from the coronavirus pandemic, fall into the following three buckets:

$1.78 billion in state aid ($1.24 billion) and local aid ($542 million) from the U. S. Treasury Department.
$900+ million in aid from various federal departments for targeted investments including: K-12 education ($415M); Higher Education ($180M); Child Care ($93M); Housing ($225M, for emergency rental and homeowner assistance); LIHEAP ($30M); and Pandemic Emergency Assistance Funds ($4.4M, to meet short-term needs of families with children).
$1.22 billion in direct assistance to individuals through stimulus checks; additional assistance through child tax credits, enhanced UI benefits, and expanded earned income tax credits, as well as PPP loans for businesses and further relief for restaurants.

The state and local aid is being provided for the following purposes:

to support the public health response to the pandemic
to respond to the adverse economic effects of the pandemic
to offer extra pay for essential workers
to replace state and local revenue lost due to the pandemic
to improve water, sewer, and broadband infrastructure

Funds can be used to address short-term needs as well as for longer-term investments.

National Information

More information from the U.S. Treasury about the state and local funds can be found here:

S. Treasury Quick Reference Guide on State and Local Fiscal Recovery Funds: https://home.treasury.gov/system/files/136/SLFRP-Fact-Sheet-FINAL1-508A.pdf
S. Treasury Fact Sheet on State and Local Fiscal Recovery Funds: https://home.treasury.gov/system/files/136/SLFRP-Quick-Reference-Guide-FINAL-508a.pdf
Interim Final Rule in the Federal Register: https://www.govinfo.gov/content/pkg/FR-2021-05-17/pdf/2021-10283.pdf

Local Information

The RI Foundation released the Make It Happen Report on October 2021 making recommendations for spending the $1.1B in ARPA Fiscal Recovery Funds (FRF) appropriated to the state.

The Governor also released his “RI 2030” plan setting out a vision for RI’s economic recovery over the next ten years which outlines how the state’s FRF funds could be used. The public can comment on the plan at hearings or in writing. Visit ri2030.com to learn more.

While the state Fiscal Recovery Funds need to be appropriated through the state budget process, other ARPA dollars provided directly to state agencies can be and have been spent without prior appropriation through the budget process.

EPI has written an ARPA in RI Update that pulls together some of this information.

The Providence Journal has a good breakdown of how local cities and towns are spending COVID-relief money.