New Info Coming From MI Treasury on ARP Dollars for NEUs

The Michigan Department of Treasury recently provided an update to League staff on their continuing efforts to distribute the $322 million, first-year tranche of American Rescue Plan dollars designated for Michigan municipalities that are designated as Non-Entitlement Units.  These dollars were allocated to 1,724 Michigan cities, villages, and townships and are scheduled to be distributed on a per capita basis.  To date, MI Treasury has received applications from than 1,660 eligible units, with every Michigan city having requested their funds, following the July 8th opening of Treasury’s application portal.  Treasury is anticipating being able to begin distributing funds to completed and approved applicants by the middle of September.

Treasury’s 3rd party vendor has recently begun the process of reviewing the submitted funding request applications and auditing those submissions as a precursor to distributing the funds.  As of last week, the vendor had completed the initial review of about 1/3 of the applications. Treasury’s Coronavirus Local Fiscal Recovery Fund webpage is being updated as the vendor completes their audit of applications to display the status for each application.

During this review process, a high error rate has been encountered, with many errors being relatively superficial in nature (missing or wrong signatories, missing addresses or incomplete fields, DUNS number errors, etc).  Communities with errors in their application will be asked to make corrections to their applications and resubmit in order for the funds to be disbursed.  To facilitate the necessary error corrections, Treasury’s vendor is expected to begin contacting communities by phone late this week/early next week to make those communities aware of the situation with their application.  Following this direct contact, a letter will also be issued, likely next week, with the specific errors identified and the process for any necessary corrections and resubmission.

Treasury staff will also be participating in next week’s (Sept 7th) Live with the League broadcast to provide a more detailed update and answer any questions.

Here is some additional information shared recently by the Michigan Department of Treasury:

Intended Audience: Non-Entitlement Units of local government requesting or declining Coronavirus Local Fiscal Recovery Funds under the American Rescue Plan Act (ARPA). Non-entitlement units are defined as primary local governments (e.g., cities, villages, townships) other than federally defined metropolitan cities and counties under ARPA.

The Michigan Department of Treasury is reviewing more than 1,600 applications from local units requesting or declining Coronavirus Local Fiscal Recovery Funds (CLFRF). Over 95% of local units have completed the on-line submission process.

The Department of Treasury review team has begun to examine applications. Once the review has been completed and the application is error-free, the contact person and Chief Administrative Officer (CAO) will receive an e-mail from  treas-arpa@michigan.gov.

Errors in Submission

If errors were found in the on-line submission, the review team will contact the local unit to discuss the identified errors. Additionally, a detailed e-mail will be sent from treas-arpa@michigan.gov describing the errors. Please note: to successfully request funding, a local unit will have to log back into the ELITE system portal and correct identified errors. To ensure funding, local units are encouraged to complete this within seven days of receipt of the e-mail or be at risk of not receiving funding.

To assist with understanding common errors, the Michigan Department of Treasury has created a list of common errors and how to fix them.

NEU Status

NEUs can go to the Michigan Department of Treasury’s American Rescue Plan Act (ARPA) webpage to obtain their status update through the on-line summary file. Additionally, once audits are completed, local units will be able to access all their submitted information on the Michigan Department of Treasury’s document search site.

Payment Status

Payments to a NEU will occur after all application requirements have been met and after a Michigan Department of Treasury review. The first payments are anticipated to be issued in the next three weeks based upon the information local units verified in SIGMA.  These first payments will be for 50% of the allocation amount. The second 50% payment will be approximately 12 months later. Additionally, a smaller payment will be made after the initial on-line submission period is closed. This payment is the redistribution of funds from NEU’s that were non-responsive.

Questions? Comments?

More information and resources on CLFRF are available at Michigan.gov/ARPA.

Questions regarding the CLFRF can be directed to the Michigan Department of Treasury by e-mail at Treas-ARPA@michigan.gov.

Chris Hackbarth is the League’s director of state & federal affairs. He can be reached at 517-908-0304 and chackbarth@mml.org.

 

Legislature Breaks Without Finishing GF Budget

The Legislature recessed for at least two weeks earlier this week without finalizing a General Fund budget and without allocating any of their remaining GF fund balance or available American Rescue Plan Act funds.  A school aid budget was completed and sent to the Governor in HB 4411, but the House’s attempt at a baseline/continuation budget in HB 4410 and the Senate’s response that simply funded revenue sharing and a couple of DHHS line items remained unresolved by the time each chamber had adjourned.

While revenue sharing was not completed before they recessed, both chambers provided a 2% statutory revenue sharing increase ($5.2 million) in their different versions.  The Senate proposal also included a League-requested $433,000 to restore the August 2020 revenue sharing cut for dozens of League members that were unable to utilize the federal CARES funding that was offered as a replacement for that cut.  The Senate proposal and a different House proposal in SB 27 also offered a $10 million appropriation to provide relief to communities impacted by the severe storms that occurred in June.

While not completed this week, these items are all expected to resurface in a full budget negotiation that is expected to proceed between the Administration and legislative leaders in the coming weeks.  Those negotiations will likely determine when the House and Senate return to action to vote on a budget deal.  At this time, the House and Senate are scheduled to return for session days on; July 14 in the House, July 15 in the House and Senate, July 21 in the House, and July 27 in the Senate. While these days are currently scheduled, the success of ongoing budget negotiations will likely determine which, if any, of these days are utilized.

The League continues to advocate for improvements in revenue sharing funding, support for municipal infrastructure repairs necessitated by shoreline erosion, substantial state investments in water and sewer infrastructure similar to the Governor’s MI Clean Water Plan and the Senate proposal in SB 565, and state funding for replacement of local bridges as proposed in different versions by the Governor and legislative leaders, among a host of other spending priorities.

In addition to their work on the various Departmental budgets, the Governor and Legislature are also debating priorities for allocating the state’s first ARP allocation of $3.25 billion.  The League and our partners are pressing for leaders to agree on a comprehensive spending plan for these dollars that will provide local governments with additional opportunities to invest in their communities and leverage the dollars that they have available for greater impact on infrastructure, building local capacity, improving housing and community development, and promoting local economic development efforts.

Chris Hackbarth is the League’s director of state & federal affairs. He can be reached at 517-908-0304 and chackbarth@mml.org.

 

Non-Entitlement Units Can Prepare Their ARP Allocation Requests

This morning, the Michigan Department of Treasury finalized the necessary forms and guidance to assist Michigan’s 1,724 “non-entitlement units”, eligible for American Rescue Plan funding on a per capita basis, to submit their requests to receive their eligible distributions. This will be the first of two distributions that NEUs will be eligible to receive under the federal stimulus, with the second distribution expected in 2022.

Treasury anticipates that the following new documents/request submissions will be able to be uploaded to Treasury’s ELITE System by July 6th.

The following information was shared by MI Treasury…

Intended Audience: Non-entitlement units of local government requesting or declining Coronavirus Local Fiscal Recovery Funds under the American Rescue Plan Act (ARPA). Non-entitlement units are defined as primary local governments (cities, villages, townships) other than federally defined metropolitan cities and counties under ARPA.

The ARPA Coronavirus Local Fiscal Recovery Fund (CLFRF) Non-Entitlement Units of Local Government (NEU) Funding Election and Budget Certification Form (Form 5751) is now available for NEUs to complete. Additionally, Numbered Letter 2021-5 is now available to assist NEUs in calculating their top-line budget for CLFRF reporting.   

The Form 5751 will be uploaded into the ELITE system along with other required documentation. Currently, the online submission portal is not active. The online portal to submit the required CLFRF reporting is expected to be live the week of Tuesday, July 6, 2021.

NEUs Can Prepare Application Materials Today

All documents to accept the CLFRF NEU funding are now available. NEUs can complete the following tasks, save each completed file as a PDF, and be ready to upload in the ELITE system in anticipation of the launch next week.

Application Requirements:

Contact Us

More information and resources on CLFRF are available at Michigan.gov/ARPA.

Questions regarding the CLFRF can be directed to the Michigan Department of Treasury by e-mail at Treas-ARPA@michigan.gov.

 

Chris Hackbarth is the League’s director of state & federal affairs. He can be reached at 517-908-0304 and chackbarth@mml.org.

How Much is Your Community Receiving from the American Rescue Plan Support? View List Here

This is a newly released web page by the Michigan Department of Treasury providing American Rescue Plan guidance to Michigan communities.

The list is finally here!

The long-awaited list of how much each Michigan community classified as a non-entitlement unit (NEU), is expected to receive from the American Rescue Plan was released this week by the Michigan Department of Treasury on this new webpage.

The list of allocations for 1,724 cities, townships, and villages, was unveiled during a Treasury webinar Thursday, June 17, 2021. The webinar is part of an ongoing COVID-19 series of webinars done by the Treasury Department in partnership with the Michigan Municipal League, Michigan Townships Association and Michigan Association of Counties. Click here for a video recording of Thursday’s webinar.

View the NEU (Non-Entitlement Units of Government) “unofficial” allocations by communities here:

The list for Michigan’s metropolitan areas was previously released.

The question, “how much is my community is getting from the American Rescue Plan Act,” has been the most frequent request the Michigan Municipal League has received since the ARP funding was approved earlier this year. So this list is welcome news to Michigan’s smaller communities, said Chris Hackbarth, the League’s director of state and federal affairs. The amounts in listed by Treasury will be distributed to communities over two year s- half this year and the other half next year.

“We know many of our communities have been anxiously waiting to learn how much ARP assistance they will receive so that they can invest into their communities and assist with the economic hardships experienced by COVID-19,” Hackbarth said. “So this list is extremely welcome and we very much appreciate Treasury’s work on this.”

It is important to note, Hackbarth said, that this funding does not need to be dedicated until the end of 2024 and doesn’t need to be spent until the end of 2026. The League encourages communities to take their time and be collaborative with residents and businesses in determining how best to invest this one-time assistance in ways that are the most impactful. The League has also launched its ServeMICity program to help communities navigate the ARP funding and other assistance that is available to help in the COVID-19 recovery effort. To learn more about the ServeMICity program email the League’s Shanna Draheim at sdraheim@mml.org.

Hackbarth said the list does come with a couple caveats. First, the list are estimates of the amount each community could receive and the exact dollar amount could change for a couple reasons:

  1. Communities can only receive ARP funding that represents 75 percent of their annual total operating budget. So, if the current allocation estimate is more than 75 percent, the amount they expect to receive will be reduced. According to U.S. Treasury NEU guidance, “all distributions to NEUs may not exceed a cap of 75 percent of the unit’s budget.  …The estimates released by the Michigan Department of Treasury do not reflect this cap. Updated amounts will be posted once budget information and acceptance is completed by the 1,724 NEUs.”
  2. The amounts received could change as some entities reach the 75 percent cap or if some units opt to not spend the maximum amount they are eligible to receive. If this were to happen, communities could get a supplemental amount once the calculations are made.

The funding listed also will be broken into two tranches, with half going to the communities this year and the other half approximately 12 months later in 2022. The list of funding estimates by NEU represents the total amount a community is estimated to receive over the two years.

Also, local units must complete an application to receive the funding. This application portal will be released by the Michigan Department of Treasury on this page here around July 6, Treasury officials said during Thursday’s webinar. Communities will have 60 days to complete the application once the portal is launched. Treasury officials said they hope to send the first tranche of funding within two weeks of when a unit officially applies for the assistance.

Here are some additional documents and links from the National League of Cities and the Michigan Municipal League detailing the ARP guidelines and allocations:

Learn more here:

TREASURY – American Rescue Plan Act (ARPA): Coronavirus State and Local Fiscal Relief Funds (michigan.gov)

 

Michigan Municipal Leaders Urge Lawmakers to Support Compromise Short-Term Rental Legislation – VIDEO

The Michigan Municipal League is keeping the pressure on state legislators looking to prohibit local governments from regulating short-term rental issues by hosting a news conference (watch video here) on the issue Monday morning. We also continue to seek help from our League members by encouraging them to contact their lawmakers, write letters to their local newspapers, and pass resolutions through our shorttermrental.mml.org resource page here.

The League’s CEO and Executive Director Dan Gilmartin was joined by officials from Frankenmuth, Grand Rapids, and Marquette, Monday for a news conference on the short-term rental issue that was attended by at least 15 members of the media statewide. Joining Gilmartin at the news conference were Mark Washington, Grand Rapids City Manager and a member of the MML Board of Trustees; Bridget Smith, Frankenmuth City Manager; Derek Lemanski, short-term rental owner in Frankenmuth; and Jenn Hill, Marquette Mayor Pro Tem.

The news event (view related press release) focused on how there are alternatives to the short-term rental bills SB 446 and HB 4722. These two bills create a one-size-fits-all policy that only caters to short-term rental owners and big corporations looking to buy up multiple single family properties and turn them into mini hotels.

However, newly introduced legislation like HB 4985 by State Rep. John Damoose and others soon-to-be introduced make clear that short-term rentals are allowed in Michigan while also giving local communities the right to implement reasonable regulations that suit their unique housing. Go here to read the bill sponsored by Rep. Damoose and go here to read the press release about his bill.

The League continues to ask our members to contact their state Senators and Representatives today to oppose House Bill 4722 and Senate Bill 446. Here are three ways you can help:

  1. Write letters to your local news papers on our Action Center here.
  2. Pass resolution in opposition to these bills and in support of alternative legislation. View sample resolutions approved by other communities here.
  3. Call your Legislators TODAY and tell them to oppose short-term rentals. Have them answer these questions:
    – Are you concerned about the skyrocketing cost of home purchasing in your community?
    – What is the wisdom in reducing housing supply for Michigan residents who live in our communities year-round and pay taxes year-round during the worst attainable housing crisis our state has ever seen?
    – What percentage of a neighborhood’s housing stock should be short term rentals? 50%? 75%? 100%?
    – What provisions in this bill keep a neighborhood from becoming 100% short term rentals?

During the press conference, local municipal leaders advocated for new legislation that balances the rights of short-term rental property owners with those of long-term neighborhood residents. State lawmakers have advanced legislation, Senate Bill 446 and House Bill 4722, that would overturn local regulations and give blanket approval for homeowners to convert their homes to short-term vacation rentals.

Newly introduced House Bill 4985 maintains locally created short-term rental laws while protecting the personal property rights of both the long-term resident and the short-term rental owner. Other compromise legislation is also in the early stages of being developed and is expected to be introduced in the coming days or weeks.

“Lawmakers have been rushing to pass legislation that would have overturned all of the work local leaders have done to carefully craft policies that balance the needs of long-term residents with those of vacationers and short-term rental owners,” said League CEO and Executive Director Dan Gilmartin. “For those lawmakers supporting bills that only protect short-term rental owners, we ask them to answer these questions: Are you concerned about the supply of affordable housing in your community? What percentage of a neighborhood’s housing stock should be short term rentals –  50 percent, 75 percent, 100 percent? And what are you doing to protect neighborhoods from being hollowed out?”

Grand Rapids City Manager and League Board Member Mark Washington stated that the current bills being promoted by real estate agents, SB 446 and HB 4722, would eliminate how communities address the concerns residents have raised over the growth of short-term rental properties.

“Short-term rentals are increasingly operating as commercial enterprises where homes in residential neighborhoods are being converted into year-round mini-hotels,” said Washington. “In addition to losing dwelling units, the quality of life can be impacted too with less parking, more traffic, more noise and nuisance complaints coming from these properties. The whole reason we have residential zoning is to help keep quiet residential neighborhoods from being overrun with disruptive commercial activity. Legislation like House Bill 4985 protects our need to create reasonable rules for how these short-term rental properties operate, and it needs to be given full consideration before any statewide law is passed governing short-term rentals.”

Proponents of Senate Bill 446 and House Bill 4722 argue the bills are intended to prevent local governments from banning short-term rentals in their entirety. However, the League has not found a single city in the state that has enacted such a ban.
Tourist destination communities are among those that have found it necessary to adopt local ordinances guiding how short-term rentals operate. Frankenmuth, for example, developed a local ordinance with input from business owners, residents and short-term rental owners.

“Frankenmuth is a tourist destination, so we are very supportive of short-term rentals,” said Frankenmuth City Manager Bridget Smith. “That’s why after taking months to gather input, we ended up with a local short-term rental law that allows an uncapped number of short-term rentals in our downtown while adopting reasonable limits of how many operate in residential neighborhoods. Any statewide law must allow communities like ours to address the unique circumstances a local community faces because our needs are not the same as everywhere else.”

Marquette is another popular destination community that adopted a local ordinance balancing the needs of permanent residents with those of tourists and short-term rental owners. Marquette Mayor Pro Tem Jenn Hill said a local short-term rental law was needed to ensure housing is available for the city’s workers.

“Housing is the number one issue in our community. People will accept a job at the university or hospital and then can’t move here because they can’t find a place to live. Taking away our ability to regulate the number of short-term rentals in our neighborhoods will make the housing crisis even worse,” said Hill. “We need legislation like House Bill 4985 to protect our ability to create local laws that meet our housing needs while making clear that short-term rentals are allowed in this state.”

Michigan Municipal League members and Michigan residents are encouraged to learn more about proposed short-term rental legislation by visiting the League’s Short-Term Rental Resource Page. When talking to your legislators, please urge them to vote down any legislation that diminishes how communities address short-term rentals based on their own local needs.

Here is some of the news coverage from today’s press conference as well as articles posted in recent days:
Short-Term Rental Legislation Brings Local Opposition – NBC 25, Flint/Saginaw/Bay City/Midland

Compromise Sought in Short-Term Rental Debate – MiBiz:

Communities Push Lawmakers to Rethink Proposed Short-Term Rental Rule – Detroit News

Grand Haven Pushes Back Against State Short-Term Rental Bills – WOOD TV, Grand Rapids

State Bills That Would Nix Local Control Over Short-Term Rentals Concerns Frankenmuth Leader – ABC 12

Editorial: Short-Term Rental Regulation is a Local Issue – Traverse City Record Eagle

Text from TC Record-Eagle Editorial, June 10, 2021: 

One size simply doesn’t fit all.

Yet, some Michigan lawmakers seem to think it should when we’re talking about the meteoric rise in short-term rental of homes in recent years popularized by online brokerages like Airbnb and VRBO.

Those lawmakers, including stte Rep. John Roth, R-Traverse City, and state Sen. Wayne Schmidt, R-Traverse City, signed onto a pair of bills meandering through the legislature in Lansing that would, to one extent or another, curb or ban local regulation of short-stay rental homes.

They, and others, argue pockets of tight regulation by some local governments infringes on homeowners’ rights. They contend wholesale bans and other restrictions on nightly or weekly home rentals (like the ban on them in Garfield Township) prevent lawful uses of our homes.

And private property rights are an issue we often would find common ground with the lawmakers. For example, the wholesale ban on short-term rentals in Garfield Township seems a bit harsh.

Still, we can imagine a plethora of ways the issue could be addressed at the local government level without blanket edicts issued by the state.

Constituents of local governments certainly could engage in the local electoral process if they felt a majority of their neighbors would support policy changes. Heck, the regulations in place in most municipalities in the Grand Traverse region have garnered laborious debate and lobbying from all sides before they were enacted.

The rules in East Bay Township are a perfect example — the kind of compromise rules generated by a thorough process that weighed both the concerns of full-time residents against non-resident owners who appreciate the income short-term renters provide in the lake-peppered vacation hotspot.

That’s the real conundrum here.

Zoning, planning and property use questions are generally accepted as best set by folks who live in the places they affect.

The fact is, short-term renting of homes is oftentimes a high-traffic, high-noise commercial use, and most residential areas have somewhat strict, localized regulations on uses that aren’t purely homeowner or long-term tenant occupation. Many of us have experienced or know someone who has experienced the nightmare of living adjacent to a vacation rental that generates a constant stream of poorly-behaved partiers.

Those are the times that would send even the most libertarian homeowners among us begging for some reasonable rules to govern those businesses.

Think about all the restrictions that preserve the relative peacefulness and character of most of our neighborhoods.

There are rules that prevent someone from opening a commercial manufacturing facility in their garage. There are rules that prohibit de-facto junkyards in neighborhoods. There are rules that govern noise. There are rules that dictate where and what structures homeowners can build on their property.

Local governments regulate all kinds of things related to the use of private property.

So why should we wrest control of short-term rental rules away from local governments?

Yes, local planning and zoning officials — especially in the Grand Traverse region where 25 percent of all of Michigan’s short-term rentals are located — face complex questions about this blurring of the line between homes and businesses.

It’s hard to imagine a state law would fit our communities better than carefully-crafted local policies.

Webinar on Federal Stimulus Scheduled for June 17

The Michigan Department of Treasury released the following agenda and registration details for their first webinar on the American Rescue Plan Act, aimed at offering the Department’s initial guidance for implementing the ARP’s Coronavirus Local Fiscal Recovery Funds.

This webinar is scheduled for:

Thursday, June 17, 2021
2 p.m. – 3:30 p.m.

In partnership with the Michigan Municipal League, Michigan Townships Association, and Michigan Association of Counties, the Michigan Department of Treasury is pleased to announce the 13th webinar in the “Updates and Resources for Local Governments” webinar series.

Topics covered will include:

  • Updates on the American Rescue Plan Act, including eligible uses and receipting
  • Strategically utilizing funds

Participants can register and submit questions on the webinar’s registration page.

Agenda

  1.  Welcome & Introductions Heather Frick, Bureau Director, Bureau of Local Government and School Services, Michigan Department of Treasury
  2. Special Message to Locals
  3. Updates on the American Rescue Plan Act
    1. Receipt of Funds
    2. Eligible and Ineligible Uses of ARPA Funds
    3. Revenue Losses
    4. Reporting
      Eric Bussis, Chief Economist and Director of the Office of Revenue and Tax Analysis, Michigan Department of Treasury
      Rod Taylor, Administrator, Community Engagement and Finance Division, Michigan Department of Treasury
  4. Strategically Utilizing All Funds
    Tim Dempsey, Vice President, Public Sector Consultants
  5. Question and Answer 
  6. Closing Remarks
    Heather Frick, Bureau Director, Bureau of Local Government and School Services, Michigan Department of Treasury

Additionally, the Michigan Department of Treasury has developed a webpage with numbered letters, memorandums, webinars, and resources regarding COVID-19 updates for local governments and school districts. This webpage was created to ensure that Michigan communities have access to the most up-to-date guidance and is updated frequently with information and resources as they become available. 

Disclaimer: The U.S. Department of Treasury has issued interim rules for the American Rescue Plan Act. These rules are subject to change. The information provided during this webinar is solely intended for general reference and is not comprehensive or final information. It is recommended that local governments review all guidance from federal Treasury and contact their legal counsel and auditor for your specific situation.

 

Chris Hackbarth is the League’s director of state & federal affairs. He can be reached at 517-908-0304 and chackbarth@mml.org.

U.S. Department of Treasury Releases Additional FAQs on the Coronavirus State and Local Fiscal Recovery Funds

The League and our partners at the National League of Cities received the following information from US Treasury regarding the posting of 10 additional FAQs on the Coronavirus State and Local Fiscal Recovery Funds that are part of the American Rescue Plan Act. The full FAQ document, which includes FAQs from the original May 10 publication date, the previous May 27 update, and this week’s update, can be found here.

Questions added in the last two updates can be referenced within the FAQ as follows.

  • 5/27/21: 1.5, 1.6, 2.13, 2.14, 2.15, 3.9, 4.5, 4.6,10.3,10.4 (updates are noted with “[5/27]”)
  • 6/8/21: 2.16, 3.10, 3.11, 3.12, 4.7,6.7,8.2, 9.4, 9.5,10.5  (updates are noted with “[6/8]”)

The specific questions added on 6/8/21 include the following:

  • May recipients use funds to establish a public jobs program?
  • In calculating revenue loss, are recipients required to use audited financials?
  • In calculating revenue loss, should recipients use their own data, or Census data?
  • Should recipients calculate revenue loss on a cash basis or an accrual basis?
  • Do restrictions on using Coronavirus State and Local Fiscal Recovery Funds to cover costs incurred beginning on March 3, 2021 apply to costs incurred by the recipient (e.g., a State, local, territorial, or Tribal government) or to costs incurred by households, businesses, and individuals benefiting from assistance provided using Coronavirus State and Local Fiscal Recovery Funds?
  • How do I know if a water, sewer, or broadband project is an eligible use of funds? Do I need pre-approval?
  • May recipients use Fiscal Recovery Funds to fund Other Post-Employment Benefits (OPEB)?
  • Once a recipient has identified a reduction in revenue, how will Treasury track use of funds for the provision of government services?
  • What is the Assistance Listing and Catalog of Federal Domestic Assistance (CFDA) number for the program?
  • May recipients use funds to cover the costs of consultants to assist with managing and administering the funds?

U.S. Treasury intends to update their FAQs periodically to help clarify questions about the Interim Final Rule.  They anticipate another update soon, which is likely to include additional questions recently posed by communities across the country. U.S. Treasury is trying to respond as quickly as possible to these questions.

It is important to note that because the Interim Final Rule is still in the 60-day public comment period, there may be some points raised by stakeholders that cannot be addressed via FAQs and will need to be considered as part of the process for revising the rule. It you have specific questions we strongly encourage you to submit comments for the record to ensure that these perspectives are reflected in the public comments when it comes time to finalize the rule.

Additionally, U.S. Treasury posted an FAQ supplement regarding distribution of funds to non-entitlement units of local government (NEUs).  This FAQ supplement includes several questions answered as part of previous FAQ updates, as well as answers to 12 additional high-priority questions that were received from stakeholders over the course of our engagement since the release of the NEU guidance on May 24.

The new questions added to the NEU FAQ supplement are listed below.

  • Can states impose requirements or conditions on the transfer of funds to NEUs?
  • Can states transfer additional funds to local governments beyond amount allocated to NEUs?
  • May states use funds to pay for the administrative costs of allocating and distributing money to the NEUs?
  • What steps do states and territories need to undertake to receive their NEU payments?
  • What are the specific deadlines for state governments in distributing funds?
  • How long does a state have to wait until an NEU can be treated as “non-responsive” and the state can issue a subsequent distribution based on unclaimed funding?
  • How should a state treat a local government on the list posted on the Treasury website that is no longer in operation and has been dissolved?
  • How should territories allocate and distribute payments to their NEUs?
  • Can states pay entities that are not included in the list of local governments provided by Treasury?
  • Is a Second Tranche payment guaranteed for NEUs, provided that they comply with the terms and conditions of the funding?
  • How should states check to see whether an NEU is excluded or disqualified as outlined in the guidance?
  • Are states required to collect key information from the NEU as outlined in the guidance (e.g., banking information or top-line budget totals) or may states rely on existing information in their systems?
  • Do states have to collect actual budget documents to calculate the “75 percent budget cap,” or can they rely on a budget total?
  • Do states have to monitor NEUs for compliance with use of funds?
  • Is there a requirement to distribute funds to NEUs electronically, or can funds be distributed via check?

The League will continue to update members on the legislature’s activities around this funding as well as forthcoming updated guidance from the US and Michigan Department of Treasury.

Additionally, the MI Department of Treasury has joined with MML to host a webinar on the American Rescue Plan Act.  This webinar is scheduled for June 17th. Stay tuned for agenda information and registration details.

Chris Hackbarth is the League’s director of state & federal affairs. He can be reached at 517-908-0304 and chackbarth@mml.org.

New ARP Guidance for “Non-Entitlement Units” Released

Monday evening, the US Treasury released guidance specifically related to the majority of Michigan communities that will receive American Rescue Plan Act funding on a per capita basis.

For Michigan, these Non-Entitlement Units (NEUs), are scheduled to receive more than $644 million in federal aid that will be distributed through the State of Michigan on a per capita basis.  While US Treasury did not attribute specific allocations to each of Michigan’s NEUs, they did provide a List of Local Governments eligible for this federal funding support.  This list also includes the 2019 census data that the State of Michigan will use to allocate this funding to our eligible NEUs.  The NEU definitional and data methodology is also outlined by US Treasury here.

Following significant lobbying by MML and our partners at the National League of Cities, this updated list of local governments from US Treasury recognizes all of Michigan’s villages as distinct NEUs, eligible for their own per capita allocation from the state.  This is an important acknowledgement for Michigan communities becasue of our unique system of local government compared with our national peers.  We are now working with the Michigan Department of Treasury and the State Budget Office to determine how the state intends to implement and distribute this funding based upon the specific guidance that US Treasury provided to the states.  According to language in the American Rescue Plan, the state is required to forward these dollars within 30 days of receipt from the federal government, with only minor allowances for extensions.  A state appropriation bill must be passed to distribute this $644 million to all 1,724 eligible Non-Entitlement Units in Michigan.

The League will continue to update members on the legislature’s activities around this funding as well as forthcoming updated guidance from the US and Michigan Department of Treasury.

HEADS UP – We are also working with the Michigan Department of Treasury on a webinar for local government officials in early June.  Stay tuned for agenda information and registration details.

Chris Hackbarth is the League’s director of state & federal affairs. He can be reached at 517-908-0304 and chackbarth@mml.org.

Additional Briefings from White House About American Rescue Plan Guidelines Set for Today and Tomorrow

Here are some of ineligible uses of the American Rescue Plan support for municipalities. These were shared Monday as part of a presentation by the U.S. Department of the Treasury during a webinar Monday.

Due to the overwhelming interest in this topic, the White House and U.S. Department of the Treasury are having additional briefings on the new guidelines municipalities must follow for the American Rescue Plan assistance. The National League of Cities and the Michigan Municipal League also have free informational virtual events to share Michigan-specific information later today and Monday. Register for today’s NLC event here and the MML’s Live with the League conversation on Monday here when we will discuss the new guidelines and what they mean for our members.

The new guidelines, which are 151 pages long (view them here and view an MML break-down of them here), were released Monday and White House briefings for municipalities reached capacity so these new briefings have been scheduled for 5 p.m. today (May 12) and 4 p.m. tomorrow (May 13). Register here for today’s briefing and here for tomorrow’s briefing.

In addition, here are some resources provided by the White House and Treasury Department:

Here are some additional resources provided by NLC and the federal government:

The National League of Cities has sent the MML the following documents detailing the guidelines and allocations:

Here is a video from the League about our new talking points (printable pdf of the talking points is here):

 

White House Briefing Offers Insights Into ARP Guidance Released Today

Staff from the White House Office of Intergovernmental Affairs and the U.S. Department of the Treasury just wrapped up their second local government briefing following today’s release of the Interim Final Guidance for the Coronavirus State and Local Fiscal Recovery program within the American Rescue Plan (ARP) federal stimulus.

Here are some of ineligible uses of the American Rescue Plan support for municipalities. These were shared Monday as part of a presentation by the U.S. Department of the Treasury during a webinar Monday.

Prior to the briefing, Treasury and the White House offered a Fact Sheet that outlined many of the highlights found within the 150 page guidance document and accompanying initial FAQ. These documents are meant to assist states and local units of government with eligible expenditure opportunities for the stimulus funds.

Administration officials offered insight into many of the goals behind the inclusion of these state and local relief dollars within the stimulus bill, including a desire to blunt many of the negative impacts that the country’s economy experienced due to the contraction in economic activity from state and local governments following the Great Recession.  The Administration views the ARP as an opportunity to help states and local governments avoid a repeat of the post-Great Recession years by providing a longer tail of support that will allow local communities to weather any unforeseen shortfalls or economic downturns on the path to recovery.

Here are some of eligible uses of the American Rescue Plan support for municipalities. These were shared Monday as part of a presentation by the U.S. Department of the Treasury during a webinar Monday.

The presenters acknowledged the need for continuing work on the guidance and related FAQs in the coming weeks and promised a robust staff response through a call center, a planned series of additional briefings, and other updates and communications with local units of government.

Specific to Non-Entitlement Local Units of Government who will receive their funding on a per capita basis as a pass-through from the state, officials this evening relayed that individual allocations for those non-entitlement units are planned for release next week.  While today’s announcement and guidance release identified the overall funds that Michigan will receive for these non-entitlement units ($644.3 million), the individual amounts are delayed while Treasury continues to navigate the unique local government structure in each state.

Tonight’s presentation offered three main focus points as the driving force behind the guidance:

  • Fighting the pandemic
  • Replacing lost revenues
  • Building a foundation for a stronger economic recovery

Here are some of eligible uses of the American Rescue Plan support for municipalities. These were shared Monday as part of a presentation by the U.S. Department of the Treasury during a webinar Monday.

League staff and our partners at the National League of Cities are diving into the guidance documents tonight and over the next few days and we will be scheduling a series of webinars for members to help understand their meaning and opportunities for investment and fiscal relief as these dollars begin to be distributed from Washington.

League members are encouraged to visit US Treasury’s Coronavirus State and Local Fiscal Recovery Funds website for continuing updates and updated FAQs.  This website also offers access to the portal for receiving direct payments for those cities classified as Metropolitan Cities according to the Act. The link to the portal can be found here.

Local governments designated as non-entitlement units are eligible to receive Coronavirus State and Local Fiscal Recovery Funds, as provided in the American Rescue Plan Act. However, they will receive this funding from their applicable state government, not though this link.

SUBMISSION REQUIREMENTS

Here are some of eligible uses of the American Rescue Plan support for municipalities. These were shared Monday as part of a presentation by the U.S. Department of the Treasury during a webinar Monday.

To complete a submission on behalf of your jurisdiction, you will be asked to provide the following information:

  1. Jurisdiction name, taxpayer ID number, DUNS Number, and address
  2. Authorized representative name, title, and email
  3. Contact person name, title, phone, and email
  4. Funds transfer information, including recipient’s financial institution, address, phone, and routing number and account number
  5. Completed certification document (to be signed by the authorized representative)

Jurisdictions must submit a request to receive funding even if they have previously applied for other programs through the Treasury Submission Portal. Eligible jurisdictions will receive further communications regarding the status of their submission via the email address provided in the Treasury Submission Portal.

Chris Hackbarth is the League’s director of state & federal affairs. He can be reached at 517-908-0304 and chackbarth@mml.org.

John LaMacchia is the Assistant Director of State and Federal Affairs for the League handling transportation, infrastructure, energy and environment issues. He can be reached at jlamacchia@mml.org or 517-908-0303.