Coronavirus State Fiscal Recovery Fund (American Rescue Plan Act) - American Cities Climate Challenge

Coronavirus State Fiscal Recovery Fund (American Rescue Plan Act)

Federal Agency


Assistance for State, Local, and Tribal Governments


To provide flexible funds for coronavirus response and for following general purposes: 1. Replacing lost public sector revenue 2. Responding to the far-reaching public health and negative economic impacts of the pandemic 3. Premium pay to essential workers 4. Investments in water, sewer, and broadband infrastructure.

Applicant and/or Project Eligibility Requirements

Eligible entities include states, tribal governments, and territories. States that have experienced an unemployment increase of at least 2% relative to Feb. 2020 will receive all funds at this time. Other states will receive funds in two tranches, 50% in May 2021 and 50% in May 2022. Tribal governments will receive funds in two payments, in May and June 2021.

Decarbonization Considerations

Coronavirus State and Local Fiscal Recovery Funds are intended to be flexible direct aid to states and local entities to address the public health and economic impacts of COVID-19. Decarbonization is not a stated goal of these funds, but recipients have a large degree of flexibility in fund use within some general parameters (see "Other Notes"). Policymakers looking to use these funds for decarbonization should identify whether there are sustainability programs or projects that have been impacted by the negative economic consequences of COVID-19 (e.g. lost public sector revenue or labor shortages). Decarbonization options with these funds may include: 1. Clean energy and climate projects that have been impacted by lost tax revenue. 2. Job training and workforce development in renewable energy and energy efficiency as part of a broader economic support packages for impacted workers. 3. Energy improvement measures as a part of water and sewer infrastructure upgrades.

Equity Considerations

A broad range of health, housing, educational, and social services are allowed for at-risk and hardest-hit communities. These communities are defined as those within a Qualified Census Tract (QCT) as designated by HUD, Tribal governments, and other populations disproportionately impacted by COVID-19. When designing programs to address negative economic consequences and impacted workers, consider job training and workforce development in renewable energy and energy efficiency.

Helpful Tips

Note that this funding cannot be used with other funding programs that have federal support.

Other Notes

Ineligible uses include to offset tax cuts and payments for pensions, debt service, legal settlements, or rainy-day funds. General infrastructure spending outside of water, sewer, broadband or to replace lost tax revenue is disallowed. Further information on eligible uses may be found in the Treasury Interim Final Guidance.

Deadline (Announced or Anticipated)

No application required, first dispersal of funds occurred May 2021 to states

Funding Available


Max Award Amount


Expected Allocations

Allocation for States

Average Award (Estimated)


Matching Funds

Not required

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