One year after President Biden signed the American Rescue Plan Act into law, our country is in the midst of one of the strongest periods of economic growth in a century. Enacted during a severe public health and economic crisis, the American Rescue Plan has made a difference in the lives of millions of Americans – expanding access to COVID-19 vaccines and testing, providing economic relief that has kept millions of children out of poverty, preventing evictions and foreclosures, and helping small businesses keep their doors open. Its results have also been historically equitable, with major progress against child poverty, food insecurity, and unemployment for low-income communities and communities of color.
While much work remains to make sure this recovery reaches all Americans and rebuilds our economy stronger than before, the first year of the American Rescue Plan has been a remarkable success. Earlier this week Treasury released new data and highlights showcasing the impact on millions of families, businesses and communities.
One year after President Biden signed the American Rescue Plan Act into law, its impact is clear to expert analysts and the local leaders on the frontline who are using these funds to ensure their communities emerge from the pandemic stronger than before.
Here’s what they are saying:
Moody’s: 4 million more jobs added in 2021 thanks to ARP
- New analysis from Moody’s found that for 2021, the American Rescue Plan resulted in 4 million more jobs and nearly doubled GDP growth. Moody’s finds that without the American Rescue Plan, unemployment would have risen in summer 2021 to back over 7% and remain materially higher after that.
- “The ARP is responsible for adding well over 4 million more jobs in 2021, and the economy is currently on track to recovering all the jobs lost in the pandemic by the second quarter of this year. If there had been no ARP, it would have taken another year for the economy to recover all of these jobs.”
- “The economy is currently on track to recoup all the jobs lost during the pandemic recession by late this year. Without government support, this milestone would not have been achieved until summer 2026. Low-wage workers, who have suffered most financially during the pandemic, would have been set back even further, since they work in industries that have desperately needed government support during the pandemic.”
Princeton Eviction Lab: Millions Avoided Threat of Eviction thanks to ARP
- New analysis by Princeton University’s Eviction Lab published yesterday found that millions of renters avoided the threat of eviction last year due to the federal government’s serious and unprecedented interventions, in significant part through the American Rescue Plan. It also found that low-income and majority-Black neighborhoods that typically see a disproportionate share of eviction cases experienced the largest absolute reduction in filings.
- “The last two years have witnessed the largest drop in eviction filings on record. Last year, millions of renters avoided the threat of eviction thanks to expanded legal protections and new social safety net programs, many of them enacted as part of the American Rescue Plan. For the second year in a row, eviction filings remained well below normal, pre-pandemic levels. The federal government intervened in the eviction crisis in a serious and unprecedented way. Our data show that that intervention has paid off.”
- “Low-income and majority-Black neighborhoods that normally see a disproportionate share of eviction cases experienced the largest absolute reductions in filings. Public policies enacted in response to the pandemic have led to a sustained reduction in housing instability and were effective in helping those most in need.”
Menino Mayor’s Survey: ARP Saved Cities from “Dramatic Cuts”
- The Menino Mayor’s Survey from the Boston University Initiative on Cities compared mayors’ fiscal outlook from before and after the American Rescue Plan. They found that after the American Rescue Plan, mayors were significantly more optimistic about the fiscal outlook and the future of their cities.
- “In 2020, prior to the American Rescue Plan, cities were expecting “dramatic cuts” and that “many critical cornerstones of urban life – including arts and cultural institutions, colleges and universities, public schools, mass transit systems, childcare, hospitals, and locally owned businesses – would take years to return to normal, if ever.”
- In 2021, “A striking 78 percent of mayors told us they would use the money from the American Rescue Plan to accomplish ‘transformative’ things that would reshape their cities’ long-term futures”
- “In short, stimulus funding from the Biden Administration provided pivotal support for America’s cities. In 2020, mayors felt cash-strapped and limited in their ability to remedy the enormous social, physical, and economic harms wrought by the COVID-19 pandemic. One year later... they were considerably more optimistic about having the fiscal resources to redress some of those impacts – and had already invested in a number of transformative programs.”
Center for Budget and Policy Priorities: “American Rescue Plan’s Fiscal Recovery Funds Are Helping Produce a Stronger Recovery”
- The Center on Budget and Policy Priorities finds that States have budgeted for 78% of available funds through February 2022. They also conclude that:
- “This robust policy response helped make the COVID-19 recession the shortest on record and helped fuel an economic recovery that has brought unemployment, which peaked at 14.8 percent in April 2020, down to 4.0 percent.”
- “Surveying the impacts on hardship, the University of Michigan’s H. Luke Shaefer concluded, ‘This is the best, most successful response to an economic crisis that we have ever mounted, and it is not even close.”
Between shuttered downtowns, drops in tourism and necessary new costs like COVID-19 testing, American cities were among the hardest hit by the pandemic. The National League of Cities reported in December 2020 that 90% of cities were experiencing revenue declines, and 76% were shouldering increases in costs due to the pandemic.
The American Rescue Plan directed historic resources directly to local governments. Local governments across the country received $130.2 billion through SLFRF alone to fund everything from vaccination drives and re-hiring public workers to keeping families housed and children in school.
- National Association of Counties President Larry Johnson stated “For the past two years, counties have served on the front lines of our nation’s response to the pandemic…The American Rescue Plan’s direct, flexible aid has been instrumental in our ability to respond to the pandemic, save lives, and strengthen local and national economies. It allows us to …. make transformational investments in our communities. We simply would not be positioned to make these investments without the American Rescue Plan.”
- The National League of Cities released an updated COVID-19 Local Action Tracker with 5,000 actions taken in 800 cities to stabilize budgets, combat COVID-19, invest in housing, and support small business.
- U.S. Conference of Mayors: This week, the U.S. Conference of Mayors released a series of videos from more than two dozen mayors talking about the impact of ARP on their cities as well as a report, The American Rescue Plan Act A Transformational Lifeline for First Responders, Small Businesses and Residents in America’s Cities. The following are some highlights of the testimonials:
“We stood to lose or lay off nearly 2,000 employees if it were not for CARES funding and then the ARPA funding. It was just that bad. It would have forced us to lay off municipal workers: I’m talking about the people who pick up the trash, I’m talking about the people who attend to our wastewater infrastructure system, I’m talking about people in our parks department, library department, I’m talking about firefighters, and I’m talking about police officers… It was the ARPA funding that was primarily used to plug that $200 million shortfall… Do you want to lose police officers? The answer is ‘no.’ Do you want to lose firefighters? The answer is ‘no'.’ Do you need your solid waste workers, the people who pick up the trash every week? The answer is ‘absolutely’… You take away the people, you take away the services.”
“In Oklahoma City, we’re getting about $120 million dollars through ARPA. We’ve already utilized it for some direct pandemic response. We worked with our City-County Health Department to build a drive-through vaccination and testing facility. . . We’ve also used it to continue our sewage surveillance program. But, we’re also and probably predominantly going to use it for economic recovery…We still have communities that haven’t fully recovered — certainly in minority communities and small business communities — so we’re focused there with our ARPA dollars.”
“First of all, we had to restore critical services in the city of Denver that were disrupted by the shutdown and disrupted by our sales tax collection, which makes up 60% of our revenue. We lost over $221 million dollars literally in a matter of days. Just shut off. From hospitality, from sales, tourism. Done. It’s gone. You’re not reaping that. So we had to readjust. So, ARPA helped us to begin to restore those critical services and bring back our employees — everyone was furloughed for the most part, except for our uniforms…Then, we began to restore and invest in our businesses, in our community-based organizations so that they could also be responsive to our community. And we really heavily invested in housing and shelter, particularly for our most vulnerable — our homeless.”
“We are so grateful for the American Rescue Plan and the ability for us as a city to have known that we could move forward. In March of 2020, April 2020, we didn't know what was going to happen to our tax revenue. We thought we might be in a place where we would be millions and millions of dollars in the hole. We furloughed 44 employees right off the bat. I felt I couldn't close City Hall and continue to pay people not knowing what we were facing. With the help of the American Rescue Plan, we have been able to confidently go into our 2021-2022 budgets, know that we can buy those police cars, know that we can continue to operate our public works, know that our fire stations can stay open. We brought everyone back. We are fully employed.”
“One of the things we’re most proud of is the huge investments we’ve made in childcare, because childcare around America has been on life support because of the impacts of the pandemic. So being able to invest in giving scholarships to families so that they can continue to afford childcare and so we can make sure that folks are getting back to work. As you know, about 1.8 million women left the workforce as a result of the pandemic, and the only way we can continue to grow our economy is by getting people back to work — and a key part of that is having safe, affordable childcare that’s accessible for families in Central Ohio.”
“We used our American Rescue Plan funds, first and foremost, to help stabilize small businesses in Lincoln. We’ve allocated over $7 million in grants to small businesses that are eligible because they were impacted by the pandemic. We’ve used that money to provide up to six months of rent and mortgage payments. … And through our exit interviews with recipients of these funds, we’ve heard that this is what helped keep them in business. This is what’s helping keep people employed who work in their companies. We’ve helped over 250 small businesses and micro businesses with those dollars from the American Rescue Plan. It really has been a lifeline for them.”
“I work at a food pantry every Tuesday and of course the food pantries were really well in demand. And little by little you have people donating and so forth, but with ARPA funds, we were able to give $15,000 to each of our ten food pantries. And what that allowed the food pantries to do was buy a freezer and refrigerator, in addition to what they had so then they were able to store more food, give more food and make it safer to give that food out. And without those funds, they never would’ve gotten that big chunk of money that they needed to make them more efficient, and that was something that I was really proud of and I know it helped a lot of people in our city.”
“A lot of these people started working virtually. Well, what does that do to all those businesses you know whether they're restaurants or retail or whatever that people are starting to not frequent? And so they started laying people off, and in some cases shutting down because their workers became ill with the pandemic and COVID. And so there were lots of people that needed a lot of help. And you know they were having to try to keep a roof over their heads, make rental payments, make house payments, put food on the table.”
“Once we did all those calculations, we saw that within two-to-three years, the rate we were going, facing COVID closing businesses, all the other stresses and having to keep employees well and keep them paid, we were facing bankruptcy. So without the support of the federal government — which all our residents are very grateful for — as a smaller city, we really were facing really dire times, so we have really applied every, every penny of ARPA to make sure that we can balance our budget.”
“First and foremost, the ARPA funds were used to make sure that we could mitigate the impact of the pandemic as much as we possibly could. It literally was a lifesaver for our community. And then when you go beyond that to the type of economic uplift that ARPA has provided, and will provide even further, it allowed us to address challenges in our community that we’ve always dreamed of addressing, but we never had the resources to address. So it gives us the double impact of economic lift, and then also taking on big challenges for generational change in Louisville.”