The Debt Limit Deal will take back unspent COVID-relief funds. Here’s what Government Leaders can do about it.

The Fiscal Responsibility Act of 2023 was signed into law by President Biden on June 3rd and suspends the federal debt limit through January 1, 2025. While this landmark legislation is expected to reduce the federal deficit by $1.3 trillion over the next 10 years, one significant aspect of the Fiscal Responsibility Act involves the rescission of certain unspent COVID-relief funds.

COVID-relief funds are at risk of recission

The Fiscal Responsibility Act of 2023 (FRA) rescinds approximately $28 billion in unobligated COVID-19 funding, including funds made available through the American Rescue Plan Act (ARPA), Coronavirus Aid, Relief and Economic Security (CARES) Act, and other pandemic-related spending bills.

The following are some of the specific COVID-19 relief funds that are being rescinded as part of the FRA:

  • $10 billion from the Coronavirus Response and Relief Supplemental Appropriations Act (CRRSA), which was passed in December 2020. This funding was provided to state and local governments to help them respond to the COVID-19 pandemic.
  • $12 billion from the American Rescue Plan Act (ARPA), which was passed in March 2021. This funding was provided to a variety of programs, including vaccine distribution, small business assistance, and unemployment benefits.
  • $4 billion from the Coronavirus State and Local Fiscal Recovery Fund (SLFRF), which was created by the American Rescue Plan Act (ARPA). This funding was provided to state and local governments to help them recover from the economic impacts of the COVID-19 pandemic.

The FRA also rescinds unobligated funds from a number of other pandemic-related spending bills, including the CARES Act, the Paycheck Protection Program and Health Care Enhancement Act, and the Coronavirus Preparedness and Response Supplemental Appropriations Act.

The implications of losing these funds are immense and could have a devastating impact on households and small businesses still grappling with the aftermath of the pandemic, in addition to harming the economy and increasing unemployment.

What can government leaders do in response to the recession of unspent COVID-relief funds?

The best way for government leaders to respond to the rescission of unspent COVID-19 relief funds will depend on the specific needs of their constituents and the state of the economy.

Government leaders can respond to the recession of unspent COVID-19 relief funds by engaging local stakeholders, such as local governments, community-based organizations, and third-party consultants.

How FORWARD can help you effectively administer COVID-relief funds

At FORWARD, we understand the challenges public officials face in effectively administering programs with limited resources. That’s why we offer fully customizable program administration solutions to accelerate access and equity in communities.

With over 80% of our staff having extensive experience in the public sector, we possess the expertise and knowledge necessary to navigate the intricacies of program administration. Our team tailors programs to meet the unique needs of your community and provide the staffing and support required for successful large-scale implementation. This empowers your team to focus on strategic planning and serving the community while we handle the operational aspects of program administration.

Case Study: Yakima Rental Assistance Program

Yakima County, WA contracted with FORWARD to administer their $27M Emergency Rental Assistance Program. Through targeted marketing efforts and impactful in-person activations, we achieved a remarkable 33% increase in application volume. This enabled the County to fully allocate funding to households in need before the Treasury deadline. FORWARD provides the tools and resources governments need to maximize the impact of available funds and deliver timely assistance to those who require it most.

Let’s Connect

During this challenging period, FORWARD stands as your trusted partner. We offer a comprehensive program administration solution that accelerates community access and equity. With our expertise and proven track record in administering significant funding, we are committed to driving profound social impact within your community.

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