The American Rescue Plan Act of 2021: What It Means to Indiana Cities and Counties

Here’s some good news for Indiana and other states hard hit by the global pandemic. The American Rescue Plan Act, also known as the COVID-19 Stimulus Package, has made $350 billion available to help states, counties, cities, and tribal governments recover from the COVID-19 pandemic. It’s part of an overall $1.9 trillion in mandatory funding, program changes and tax policies aimed at mitigating the continuing effects of the pandemic.

State and local government recipients must use the funds to cover pandemic-related costs outlined in the Act incurred by December 31, 2024.

Let’s take a closer look at how the funds are broken out on a national level:

• $195.3 billion for states and the District of Columbia
• Of this, $25 billion is to be equally divided to states so each gets a minimum of $500 million
• Another $169 billion goes to states based on their share of unemployed workers from October-December 2020

Now let’s look at how the funds are broken out on a state level:

• $130.2 billion to local governments
• Of this, $65.1 billion goes to counties
• $45.6 billion for metropolitan cities
• $19.5 billion for towns with fewer than 50,000 people.

If you live in Indiana, here’s how the funding breaks out by county. All 92 counties will receive funds with Marion County getting the most ($187 million) and Ohio County getting the least ($1.1 million). Here are the top 20. If your county is not included, contact me and I’ll share the info with you.

Here’s how the funding breaks out by city. Twenty-four cities will receive funding.

The big questions is how are these funds to be used? You can get more details here but here’s a quick overview:

• Provide aid to households, small businesses, nonprofits, and industries such as tourism and hospitality impacted by the pandemic.
• Provide premium pay to essential employees or grants to their employers. Premium pay can’t exceed $13 per hour or $25,000 per worker.
• Provide government services affected by a revenue reduction resulting from COVID-19.
• Make investments in water, sewer and broadband infrastructure.
• Funds for local education agencies

I want to hone-in on two major opportunities. First, funds allocated for water and wastewater treatment facilities. We all expect clean water to drink and sewage to be processed appropriately. However, counties are increasingly challenged to keep water treatment facilities operating at optimal levels while keeping costs low for customers. So it’s great to see the American Rescue Plan Act address the need to invest in this type of infrastructure.

One of the trends Solential Energy is seeing at water treatment plants to generate their own solar power. Plants can reduce their monthly energy costs by more than 50% with solar and also avoid future rate hikes. (The cost of sunshine never goes up unlike traditional power sources.) Water treatment facilities use tremendous amounts of energy for processing. By reducing energy costs with solar, plants are better able to control rates to customers. That’s always a win.

With money now available to counties for water and wastewater treatment infrastructure, there is no better time to evaluate the impact of solar power on operating costs. In many ways it’s what I call a “two-fer” – federal money for the improvements and significant, ongoing energy savings.

The second big opportunities is for schools. The American Rescue Plan Act requires that 20% of any funding received by local education agencies address learn loss. The remaining funds are flexible and can address a variety of needs, including repairing ventilation systems, reducing class sizes and implementing social distancing guidelines, purchasing personal protective equipment, and hiring support staff to care for students’ health and well-being.

These new funds are in addition to the $900 billion included in the Consolidated Appropriations Act of 2021, passed in December 2020 in $82 billion was set aside for the Education Stabilization Fund. Indiana will be receiving approximately $858 million for K-12 schools or approximately four times the amount funded in 2020. This legislation extends and revisits much of the same education relief included in the CARES Act passed in March 2020 that provided $54.3 billion for the Elementary and Secondary School Emergency Relief Fund. Learn more in an earlier Solential blog here.

The December legislation has a provision of funding the repair and improvement of school facilities to reduce the risk of virus transmission and exposure to environmental health hazards. Now, the new Act provides even more funding for projects like improving indoor air quality that improve student-teacher health and safety.

Thanks to available funding, Solential, working with our partner Trane Technologies, is helping school districts address the critical need to create safer learning environments. Specifically, we’re helping school districts reduce the risk of COVID and other viral transmissions transmission through indoor air quality projects. Again, with these significant federal resources available, now is the time to tackle these projects without straining school district budgets.

At the same time, we’re also helping school districts move to solar for that “two-fer” I mentioned—federal funding and the opportunity to cut energy-related expenditures in half. And that adds up to a lot of money that can be redirected to other school programs and wish lists.

I know I’ve thrown a lot at you on the American Rescue Plan Act and there’s more to delve into. If you’re a city or county official, a water/wastewater treatment officer, school superintendent, engineer or otherwise have a vested interest in spending these one-time federal funds wisely, let’s connect. I’ve got more information on the Act as well as strategies and funding for solar projects. Call or text me at 317-627-4530 or email cmiller@solential.com.