Proceed with caution: US local governments and the American Rescue Plan

Abstract

ABSTRACT Will a legacy of fiscal stress limit local governments’ willingness to make equity-focused investments even in the context of the relative surplus that American Rescue Plan funds provide for local governments in the US after COVID-19? Focus groups with local officials show the desire to address basic infrastructure investments (water and sewer) is primary, and concerns over recurring expenditure responsibilities, administrative burden and rising citizen expectations cause them to proceed with caution. However, the flexibility and size of ARPA funds make more progressive investments possible.