PSATS has received many questions recently on the American Rescue Plan funds when to expect new regulations, and when and where townships will need to report on the use of these funds. Here is the latest:
Accounts: DCED recommends using 352.53 or 352.530, Federal Entitlements to Governmental Units, from the Chart of Accounts for this new revenue source. It is recommended that the funds be transferred into a separate interest-bearing account.
Reporting: (10/1/21 U.S. Treasury update) Municipalities with populations of less than 50,000 (non-entitlement units) are required to file one report each year, an annual report due on April 30, 2022. Townships will NOT be required to file a report on October 31, 2021. The report should cover activity from the date of award through March 31, 2022. Treasury will provide a user’s guide for this report prior to the new due date.
Note that states, counties, and municipalities with populations of more than 50,000 are required to file additional reports, such as interim and quarterly reports. Treasury’s Compliance and Reporting Guidance has basic reporting information for larger municipalities and NEUs.
Final Regulations: In May, the U.S. Treasury released an Interim Final Rule on the use of the funds and compliance. Treasury asked for comments on the rule and received a significant amount of input, including a lengthy letter submitted by PSATS. Since the July 16 deadline for comments, Treasury has been working on a new rule, which is expected to be released by October. To date, additional guidance has provided more flexibility and direction on the use of funds, but the final rule could also be more restrictive.
PSATS will notify our members once Treasury releases the final rule, as well as the users’ guide for the annual report, and will provide direction on these documents.
Learn more: PSATS’ fact sheet on the American Rescue Plan (updated August 2021) provides an overview of the act and allowable uses. If your township is trying to determine allowable uses under the Interim Final Rule, we recommend that you review the rule itself, as well as the Frequently Asked Questions provided by Treasury that further explain the allowable uses. In addition, township officials should review the Compliance and Reporting Guidance provided by Treasury for reporting information. When reading these documents, particularly the Compliance and Reporting Guidance, be careful to only read those sections that apply to non-entitlement units (NEUs) if your population is less than 50,000. Note that larger municipalities and counties have different reporting requirements than NEUs. y.
PSATS Premier Partner: PSATS’ new Premier Partner, Zelenkofske Axelrod LLC, will work with your township to find eligible uses for the funds that benefit your community and help you navigate federal compliance and reporting requirements. The company can ensure that an eligible use meets the program requirements and that your documentation is complete. There is an additional fee for this service, which is an eligible use of the ARP funds, and the company is offering discounted pricing to PSATS members. To learn more, contact Pat Kirk at email@example.com or Cory Johnson at cjohnson@ zallc.org or call (717) 561-9200, ext. 5300
Town Hall Update on Federal Funding Regulations
Click here for a copy of the presentation for PSATS’ Virtual Town Hall on May 14 on the U.S. Treasury regulations, which contain important details on how townships can use these funds as well as reporting and compliance requirements. Click here to watch the May 14 Town Hall.
Click here to access the U.S. Treasury Regulations
Click here for a sample budget resolution
Click here for the ARP revenue replacement calculator
Note: Change the Base Year Revenue Period to 12/31/19. To use the calculator, be sure to complete all worksheets.