U.S. Department of the Treasury

The State and Local Fiscal Recovery Funds provide substantial flexibility for each recipient to meet local needs within several eligible use categories described in the 2022 Final Rule and the 2023 Interim Final Rule.

Use Of Funds

The 2022 Final Rule and Overview of the 2022 Final Rule describe how recipients may use SLFRF funds to:

• Replace lost public sector revenue, using this funding to provide government services up to the amount of revenue lost due to the pandemic
• Respond to the far-reaching public health and negative economic impacts of the pandemic, by supporting the health of communities, and helping households, small businesses, impacted industries, nonprofits, and the public sector recover from economic impacts
• Provide premium pay for essential workers, offering additional support to those who have and will bear the greatest health risks because of their service in critical sectors
• Invest in water, sewer, and broadband infrastructure, making necessary investments to improve access to clean drinking water, to support vital wastewater and stormwater infrastructure, and to expand affordable access to broadband internet

Additionally, the 2023 Interim Final Rule and Overview of the 2023 Interim Final Rule describe three additional eligible uses of SLFRF funds:

• Emergency relief from natural disasters, to provide emergency relief from the physical and economic impacts of natural disasters.
• Surface transportation projects, utilizing funds for eligible projects through three pathways.
• Title I projects, investing in activities that are eligible under the CDBG and ICDBG programs, as listed in section 105(a) of the Housing and Community Development Act of 1974.

RESOURCES FOR DETERMINING ELIGIBLE USES

Treasury has provided a number of resources to aid recipients in determining eligible uses for SLFRF.

2022 Final Rule

• The 2022 Final Rule provides rule text and supplemental information.
• The 2022 Overview of the Final Rule provides a summary of major rule provisions for informational purposes and is intended as a brief, simplified user guide for recipients and stakeholders.
• The SLFRF FAQs provide responses to frequently asked questions regarding the use of funds under the 2022 Final Rule. These FAQs will be updated to address the 2023 Interim Final Rule.
• The Statement Regarding Compliance with the Coronavirus State and Local Fiscal Recovery Funds 2021 Interim Final Rule and 2022 Final Rule provides guidance on the transition from compliance with the 2021 Interim Final Rule to compliance with the 2022 Final Rule.
• Tool for Determining Low and Moderate Income (LMI) Households provides a spreadsheet to assist recipients in determining income thresholds for the 2022 Final Rule’s definition of LMI in their jurisdiction and assist with administering the public health and economic response provisions of the Final Rule.
• The 2022 Final Rule webinar and slide presentation provide an introduction and summary of the 2022 Final Rule.

2023 Interim Final Rule

• The 2023 Interim Final Rule provides the 2023 interim final rule text and supplemental information for the new uses provided in the Consolidated Appropriations Act, 2023.
• The Overview of the 2023 Interim Final Rule provides a summary of rule provisions for the new uses outlined in the Interim Final Rule for informational purposes and is intended as a brief, simplified user guide for recipients and stakeholders.
• The 2023 Interim Final Rule webinar and slide presentation provide an introduction and summary of the 2023 Interim Final Rule.

Obligation Interim Final Rule

• In May 2024, Treasury also hosted a webinar with an accompanying Obligation Webinar Slide Deck for recipient governments about the recent update to the SLFRF FAQs related to the Obligation requirement.
• In November 2023, Treasury issued an Obligation Interim Final Rule to address recipients’ questions regarding the definition of “obligation” and provide related guidance and clarifications.
• The Obligation Interim Final Rule Quick Reference Guide provides a summary of the Obligation Interim Final Rule to assist recipients and stakeholders.
• In March 2024, Treasury updated the SLFRF FAQs with new FAQs to provide additional clarifying information about the obligation Interim Final Rule.  These FAQs can be found in section 17 of the SLFRF FAQs.