CARES Act: Local Government Impact

Much of the media attention regarding the CARES Act has been paid to provisions helping individuals and small businesses. However, there are also opportunities available for local government relief.

We’ve gone through this landmark legislation and found several ways that it can help your entity weather the COVID-19 pandemic.

Liquidity: The CARES Act makes $454 billion available for loans and loan guarantees to municipalities. (This is the same fund available to small businesses.) The intent is to provide liquidity through direct loans, or through the purchase of obligations or other interests in secondary markets.

Coronavirus Relief Fund: An additional $150 billion in appropriations is being made to state, local and tribal governments. Those entities with populations of more than 500,000 will be eligible to receive direct funding. However, it’s anticipated local governments below this threshold will be able to receive coronavirus relief funds through the state.

State and Local Law Enforcement Assistance: An additional $850 million has been made available to prevent, prepare for and respond to coronavirus. This money comes from the Edward Byrne Memorial Justice Assistance Grant program. Funds will be awarded using the formula allocation used in fiscal year 2019 grant allocations.

Community Development Fund: Another option in local government relief lies in $5 billion in community redevelopment block grants (CDBGs). Of this amount, $2 billion will be allocated to grantees that received funds using the same formula used in fiscal year 2020. The remaining funds will be allocated based on a new formula.

CDC-Wide Activities and Program Support: There is $1.5 billion available for grants or cooperative agreements with states, local governments and trial organizations to carry out pandemic-related work. This includes surveillance, epidemiology, laboratory, capacity, infection control, mitigations, communications, and other preparedness and response activities related to coronavirus.

Grants-in-Aid for Airports: A $10 billion fund will be available to prevent, prepare for and respond to coronavirus. Local governments should be on the lookout for opportunities from the Federal Aviation Administration.

Transit Infrastructure Grants: On a similar note, $25 billion in funding is available for the same purposes for infrastructure. Operating and capital costs will be considered eligible. Watch for opportunities from the Federal Transit Administration. Local transportation organizations might have them as well.

Election Security Grants: The CARES Act provides $400 million to prevent, prepare for and respond to coronavirus for the 2020 election cycle. Funding will be made available to states through the Election Assistance Commission, and states will likely make amounts available to local election offices.

Possible Postponement of GASB Effective Dates: GASB is considering postponing the effective dates for Standards 87 and 84 (and their respective implementation guides). While not part of the CARES Act’s local government relief provisions, it’s an important development to watch.

If you’re a local government department leader or on a grant management team, keep contact with state and federal agencies about these and other opportunities. New information is made public every day as these programs are adjusted and questions are answered.

Your government CPAs at James Moore are also tracking these and relief packages. We’ll make sure we have the latest information to serve you. Please contact us if you have questions or concerns about your government entity.

All content provided in this article is for informational purposes only. Matters discussed in this article are subject to change. For up-to-date information on this subject please contact a James Moore professional. James Moore will not be held responsible for any claim, loss, damage or inconvenience caused as a result of any information within these pages or any information accessed through this site.