Key SLFRF FAQ Question Addresses Impact of National Emergency’s Termination

It may only be a small update to a larger federal government guidance document, but it has certainly peaked some interest among members of the grants community. The Department of the Treasury last week added only one single new question to its 58-page State and Local Fiscal Recovery Fund (SLFRF) Final Rule Frequently Asked Questions (FAQ) document, but because it addresses the use of funds at end of the COVID-19 national emergency, this question is bound to draw greater attention.

Congress voted last month to terminate the COVID-19 national emergency, effective as of April 10. The SLFRF final rule defined the “COVID-19 public health emergency” as the period beginning on Jan. 27, 2020, through the termination of the national emergency concerning the COVID-19 outbreak. In response to the new question, which asked how the termination of the national emergency affects the SLFRF program, Treasury provided the following discussion:

• Premium pay: The SLFRF final rule allowed recipients to use SLFRF funds to provide premium pay to eligible workers performing essential work during the COVID-19 public health emergency. Now that the national emergency has terminated, recipients may not use SLFRF funds to provide premium pay to essential workers for work conducted after April 10. Recipients may continue to use SLFRF funds to provide premium pay to essential workers for work conducted before that date.
• Public health and negative economic impacts: SLFRF recipients may continue to use funds to respond to the public health impacts or negative economic impacts of the pandemic. This eligible use is not affected by the termination of the national emergency. Recipients may continue to use SLFRF funds to support and expand the workforce, including by helping impacted workers enter in-demand careers, such as in health care and child care. They also may use SLFRF funds to build public sector capacity, including hiring public sector workers and providing retention incentives.
• Revenue Loss: The end of the national emergency also does not impact how recipients calculate revenue loss according to the formula included in the final rule, and does not impact how recipients claim up to $10 million in revenue loss under the standard allowance.
• Water/sewer/broadband: The termination of the national emergency does not affect how recipients may use SLFRF funds under the water, sewer and broadband infrastructure eligible use category. Further, as the Department of Health and Human Services intends to end the COVID-19 public health emergency on May 11, this action will not affect recipients’ ability to spend funds under the SLFRF program.

Hopefully other agencies will follow suit and provide guidance pertaining to COVID-related programs to inform recipients as to any impacts the end of the national emergency will have on those programs.

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