West Virginia Counties and Municipalities Await Cash Influx. What Happens Next?

On March 11, President Biden signed into law the American Rescue Plan of 2021 (“Rescue Plan”), a $1.9 trillion COVID-19 relief package with the goal of providing financial relief to Americans and incentives to stimulate the economy following the pandemic. The Rescue Plan funds a number of programs, including federal unemployment benefits, school re-openings, tax credits for employers and families, direct cash payments to qualifying Americans, and expansion of vaccination and virus-testing programs.

In addition, the Rescue Plan provides nearly $360 billion in direct financial aid for state, local, tribal, and territorial governments.

In West Virginia, the direct financial aid will be distributed in the following amounts, with the first distribution to occur in April, 2021:

• $1.25 billion for the state
• $348 million for counties
• $176 million for larger municipalities
• $153 million for smaller municipalities

The approximate amounts allocated to each county and municipality may be found here.

Permitted uses of the direct financial aid to local governments include:

• Responding to or mitigating the COVID-19 public health emergency or its negative economic impacts, including assistance to households, small businesses, and nonprofits;
• Responding to essential workers during the COVID-19 public emergency, including premium pay for eligible workers of a county or municipality;
• Covering lost revenue due to the Pandemic relative to revenues collected in the most recent fiscal year; and
• Making necessary investments in water, sewer, or broadband infrastructure.

The Department of the Treasury is expected to release further guidance on the utilization of direct financial aid in the upcoming weeks.

If you have questions about the Rescue Plan and how it might affect your local government or business, please contact one of the authors of this alert.