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Billions in COVID-19 relief coming; Boston Fed panel urges community-driven approach for use Billions in COVID-19 relief coming; Boston Fed panel urges community-driven approach for use

Leaders say municipalities should focus on creating more equitable economies Leaders say municipalities should focus on creating more equitable economies

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July 26, 2021

The Boston Fed Working Places team gathered people from across New England last month to better understand the unique opportunities created by the billions in funding going to communities through the American Rescue Plan Act.

The team was joined by experts who offered insights into how different pandemic-stricken municipalities and counties can use the moment to build stronger, more equitable local economies. Those leaders included:

  • Jay Williams, The Hartford Foundation, and former mayor of Youngstown, Ohio
  • Marie-Frances-Rivera, MassBudget
  • Michael Wallace, National League of Cities
  • Ted Brady, Vermont League of Cities and Towns

The massive scale of the American Rescue Plan Act, or ARPA, makes it hard to understand which funding supports what. This June 16 webinar focused on the $65 billion in direct funding going to cities and counties via the Coronavirus State and Local Fiscal Recovery Funds.

Throughout the presentations, speakers reinforced the basic principles of the Working Cities Challenge and the Working Communities Challenge (which are both under the Working Places umbrella). Those principles include encouraging participants to come together across sectors to identify and pursue a shared vision for prosperity. Speakers also urged attendees to engage deeply with all impacted community members and take advantage this unique opportunity to advance strategies that increase economic equity.

A recording of the 1-hour webinar can be viewed here.

Some key insights from the conversation include:

  1. Understand the opportunity. Know how much money is coming to your local community (see allocations by city and by county). Communities have three years to allocate these funds, so they can fund immediate needs while also planning longer-term strategies to have lasting impact. One approach may be for communities to establish an equity fund that’s accessible to those with more urgent needs while leaders gather data and determine the best strategies to meet future needs. Broadly speaking, the ARPA funds may be used for:
    • Public health needs due to the COVID-19 pandemic
    • Economic needs due to the COVID-19 pandemic
    • Premium pay for essential workers
    • Necessary investment in water, sewer, and broadband infrastructure
    • Lost revenue due to the pandemic (This provides significant flexibility to address standing needs.)

    These funds can be used to target communities with high poverty levels. Cities and counties are also encouraged to address racial disparities and inequities, since COVID-19 disproportionately impacted already marginalized communities. A more complete list of acceptable uses can be view in the PowerPoint deck.
  2. Learn the landscape. Cities, towns, and counties can direct this funding toward innovation and solving systemic challenges. Fully understanding the available and expected funding helps ensure local ARPA dollars fund more flexible and creative strategies, as opposed to meeting needs that may be funded through another mechanism.

    It’s important to note that cities, towns, and regions can access other pandemic response resources beyond local ARPA funds, and that more support may be on the way. (Check out this National League of Cities website for an overview and the full picture of ARPA funding). For example, school districts are receiving funding through the Elementary and Secondary School Emergency Relief Fund, while each state received discretionary funds through ARPA.

    Since additional funds may be available to support infrastructure, local leaders should consider that local ARPA funds may be more flexible than other forms of state and federal assistance – and community groups should remind state and local leaders of this. Knowing the bigger picture about how ARPA dollars will be used can put local priorities in context and open opportunities to increase impact.
  3. Get ARPA on the agenda. Community leaders must make sure there is broad local awareness about the opportunities ARPA funding presents and about the urgency of an equity-based approach. Depending on the city or town, ensuring these issues are on the agenda at key meetings is an essential first step.
  4. Build a collaborative approach. Communities with a collaborative leadership infrastructure already in place are best positioned to take advantage of the ARPA opportunity because they’ve likely already planned how to maximize additional resources. But it’s critical for communities without this type of infrastructure to convene representatives from different organizations and groups to discuss how to spend these dollars. (Philanthropic groups and associations of cities and towns can help play this convening role.) Organizations should also seek to understand how their individual missions fit into broader community goals and work together to develop a plan that is greater than the sum of its parts.

Additional resources: