Arkansas gets $1.8 billion boost in state, local budget coffers from American Rescue Plan

Arkansas gets $1.8 billion boost in state, local budget coffers from American Rescue Plan

Pulaski County and City of Little Rock to get $76.1 million and $37.7 million share, respectively

By BCN Executive Editor Wesley Brown – May 11, 2021 — The state of Arkansas will begin seeing nearly $1.8 billion in stimulus aid from President Joe Biden’s American Rescue Plan Act flow into state, county, and municipal budget coffers this week, the U.S. Treasury announced on Monday.

Under the $2.2 trillion stimulus package signed into law exactly two months ago, the American Rescue Plan will deliver $350 billion for state, local, territorial, and tribal governments to respond to the COVID-19 emergency and bring back local jobs across the U.S.

According to the Treasury Department’s breakdown of the emergency aid, all 50 states and the District of Columbia will each get direct payments from a pool of $195.3 billion, while counties and the nation’s largest cities will receive another $110.7 million. Tribal governments and U.S. territories will get access to $24.5 billion, and non-direct government entities and recipients will split the remaining $19.5 billion.

Arkansas Republican congressional delegation silent on rescue funds

In Arkansas, none of the state’s all-Republican congressional delegation offered statements concerning the flow of new federal funds from the Biden administration. During debate on the measure earlier this year, Arkansas two senators or four House representatives, including Rep. French Hill, R-Little Rock, strongly opposed Biden’s rescue plan.

Altogether, $1,573,121,580 is expected to flow into state budget coffers in the coming weeks. See outlays here. The 93rd Arkansas General Assembly recessed in late April and will return to the State Capitol in the fall to consider how those funds will be disbursed, along with redrawing congressional and legislative districts statewide. According to the Treasury Department, Arkansas’ portion is largely based on the average number of unemployed workers in the state.

Incidentally, Gov. Asa Hutchinson Asa Hutchinson on Friday said he is opting out of the federal supplemental unemployment assistance that offers state jobseekers an extra $300 per week during the COVID-19 pandemic. Under the same American Rescue Plan Act, unemployment benefits were extended until September 6 with a weekly supplemental payout of $300 on top of the regular $400 benefit. See the story here at BlackConsumerNews.com.

In addition to the nearly $1.6 billion that the state of Arkansas will receive, all 75 counties will also split a large pool of funding of several hundred million. As Arkansas largest county, Pulaski County will receive $76.12 million in emergency aid, followed by Benton County and Washington County receiving a total of $54.12 million and $46.45 million, respectively. The $65.1 billion allocated to every county in the U.S. is based on the total population estimates from 2019 Census Bureau data, Treasury officials said. See breakdown of Arkansas counties here.

Also, 14 Arkansas largest metropolitan service areas (MSAs) will also receive a share of nearly $45.6 billion in funding set aside through community development block grant (CDBG) program. According to the U.S. Treasury, 142 U.S. cities will receive such funding for coronavirus relief. As Arkansas largest city, Little Rock will receive the largest share of $37.71 million, followed by Springdale and Fort Smith at $21.35 million and $21.22 million, respectively. Jacksonville will receive the smallest share of $5.44 million. See here.

The City of Little Rock Board of Directors has called a special meeting today at 4 p.m. to set the agenda for the city’s May 18 board meeting. That meeting is to consider Mayor Frank Scott Jr., request for a special election on July 13 to consider his one penny sales tax initiative. There is no mention on the agenda of the millions of dollars in new funding from the Biden administration’s rescue plan.

Called the Coronavirus State and Local Fiscal Recovery Funds, the Treasury Department said the emergency relief will “provide resources to meet these needs through the provision of care for those impacted by the virus and through services that address disparities in public health that have been exacerbated by the pandemic.

Among many things, these funds can help support services and programs to mitigate the spread of the COVID-19 virus. Recipients may also use this funding to address a broad range of public health needs across COVID-19 mitigation, including medical expenses, behavioral healthcare, and public health resources.

 The U.S. Treasury also released details on the ways funds can be used to respond to acute pandemic-response needs, fill revenue shortfalls among state and local governments, and support the communities and populations hardest-hit by the COVID-19 crisis. Eligible state, territorial, metropolitan city, county, and Tribal governments will be able to access funding directly from the Treasury Department in the coming days to assist communities as they recover from the pandemic, said U.S. Treasury Secretary Janet Yellen.

“Today is a milestone in our country’s recovery from the pandemic and its adjacent economic crisis. With this funding, communities hit hard by COVID-19 will be able to return to a semblance of normalcy; they’ll be able to rehire teachers, firefighters and other essential workers – and to help small businesses reopen safely,” said Yellen.  “There are no benefits to enduring two historic economic crises in a 13-year span, except for one: We can improve our policymaking. During the Great Recession, when cities and states were facing similar revenue shortfalls, the federal government didn’t provide enough aid to close the gap. That was an error. Insufficient relief meant that cities had to slash spending, and that austerity undermined the broader recovery. With today’s announcement, we are charting a very different – and much faster – course back to prosperity.”

Yellen said that while the need for services provided by state, local, territorial, and Tribal governments has increased —including setting up emergency medical facilities, standing up vaccination sites, and supporting struggling small businesses—these governments have faced significant revenue shortfalls because of the economic fallout from the crisis.

“As a result, these governments have endured unprecedented strains, forcing many to make untenable choices between laying off educators, firefighters, and other frontline workers or failing to provide services that communities rely on. Since the beginning of this crisis, state and local governments have cut over 1 million jobs,” said Yellen, the former Federal Reserve chair.  

In a statement following the Treasury Department’s announcement on Monday, Rep. Carolyn B. Maloney, D-N.Y., chairwoman of the Committee on Oversight and Reform, called the $350 billion in federal funding critical for states and localities to recover from the pandemic.

“Today’s launch of the State and Local Fiscal Recovery Funds marks the next step along the road to recovery, providing the tools our communities need for resilience, healing, and prosperity,” said Maloney.  “These funds will be made available for a wide range of community needs, including getting vaccine shots in arms, upgrading school safety, providing mental health services, helping struggling families and small businesses, and supporting an equitable recovery for our hardest-hit populations.”

For an overview of the Coronavirus State and Local Fiscal Recovery Funds program including an expanded use of eligible uses, see the fact sheet released today. Find additional details on the state, local, territorial, and Tribal government allocations on the Coronavirus State and Local Fiscal Recovery Funds Webpage.

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