ARPA closing rule – The “B-sides assortment”: Parks and recreation facility enhancements | Bricker & Eckler LLP

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Continuing our series of articles examining the lesser-publicized aspects of the American Rescue Plan Act’s guidance (hence the nickname “B-sides”), here we look at the US Treasury Department’s guidance on stimulus spending of the federal government to support the planned projects to improve parks and other recreation areas.

The four buckets of legitimate use

Under the last rule, ARPA allows four categories of eligible uses, the first of which is relevant here: “(A) To respond to the public health emergency or its adverse economic impact, including supporting households, small businesses and non-profits organizations, or help for affected industries such as tourism, travel and hospitality; (B) To respond to workers performing essential work during the COVID-19 public health emergency by paying a bonus to eligible workers; (C) For the provision of government services to the extent of the reduction in revenue due to the COVID-19 public health emergency relative to revenue generated in the last full financial year prior to the emergency; and (D) make necessary investments in water, sewage or broadband infrastructure.” [i]

Where do improvements to parks and recreational facilities fit?

The final rule includes in the enumerated eligible uses (considered an appropriate response to the adverse economic impact of the pandemic under the 1st bucket above) “investments in communities…like parks [and] Leisure facilities” for disproportionately affected households and population groups.[ii] The admittedly tenuous link between a global pandemic and public leisure facilities is made by the Treasury Department when it states: “[p]Arks, recreation facilities and sidewalks can promote healthier living environments by enabling safe and socially distanced recreation during the COVID-19 pandemic.” [iii] The Treasury Department goes on to clarify that in disproportionately affected communities, such investments include physical assets such as “parks, green spaces, recreational facilities, sidewalks, [and] Pedestrian safety features [such as] zebra crossings.” [iv]

Be careful not to just lump sum payment for all outdoor recreation facilities with ARPA funds. Rather, such public recreation facilities must be located in disproportionately affected communities. These are communities and populations “that have experienced disproportionate or significantly more severe impacts from the pandemic,” and include those located in high-quality census areas and those considered to be low-income households.[v] Local governments may also use categorical eligibility to define these communities, including those otherwise eligible for Temporary Assistance to Families in Need (TANF), Supplemental Food Assistance Program (SNAP), Free and Reduced Lunch, Supplemental Security Income (SSI), Section 8- Have coupons , and Low Income Home Energy Assistance Program (LIHEAP), among others.[vi]

Therefore, in certain cases, ARPA offers state and local government recipients the opportunity to beautify their parks and recreation areas. Specifically, ARPA funds may be used for purposes of improving, renovating and/or installing pathways, fences, walls, utilities, picnic shelters, maintenance sheds, bridges, bike racks, light poles and signage. This is certainly not an exhaustive list, as ARPA allows for additional possibilities not specifically mentioned in the final rules and guidelines.

Conclusion

With our ongoing B-Sides Collection series, we aim to highlight some of the eligible uses that are not necessarily obvious (e.g., park and recreation area improvements, affordable housing, establishment of revolving loan funds, financing of capital projects, and demolition and capital expenditures in the association with vacant and abandoned buildings, etc.) on the front of the four “buckets” of ARPA eligible uses.

This information is shared as we see creative uses of ARPA funds in our practice. It can be good for a local government to think about their ARPA funds beyond just improving water and sanitation infrastructure. Recipients can take advantage of opportunities to use their ARPA grant on legacy projects that will far outlast the pain of the pandemic.

[iii] see US Treasury, Final Rule, Supplementary Information, on page 131

[v] see US Treasury, Final Rule, Supplementary Information, on page 38

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