Read the full report: The American Rescue Plan Act of 2021: New York’s Share of the Coronavirus Fiscal Recovery Fund
The American Rescue Plan Act of 2021 includes $350 billion in aid for states, territories, and tribal governments for the purpose of alleviating the fiscal stress caused by the COVID-19 pandemic. Of the $350 billion, $195.3 billion is allocated for payments to states, $130.2 billion for city and county governments, $20 billion for tribal governments, and $4.5 billion for territories. These coronavirus fiscal recovery funds can be used to offset the pandemic’s impact on revenue, pay public sector employees, fund capital projects, and to make broadband, water, and sewer infrastructure investments. Each state received a minimum allocation of $1.25 billion and local governments with a population of at least 500,000 were eligible for direct payments.
Of the $350 billion, New York will receive a total of $24 billion, or seven percent. Specifically, $13 billion has been allocated for the New York State government, six billion dollars for metropolitan cities, four billion dollars for counties, $825 million for local governments, and $350 million for state capital projects. According to the distribution formula, the funding amount for each state relies on its unemployed residents’ share of the total unemployed population in the US at the end of 2020. In contrast, the first major federal relief package, the Coronavirus Aid, Relief, and Economic Security (CARES) Act of 2020, provided $150 billion to states, territories, and tribal governments and relied on the total population to allocate funding. This difference in funding takes into consideration the impact that pandemic mitigation efforts have had on the unemployment rates in states. New York was one of the first states to impose a strict lockdown this time last year and has continued to impose restrictions based on the ebbs and flows of the virus throughout the state. In January 2020, before the start of the coronavirus pandemic, New Yorkers enjoyed a historically low unemployment rate of 3.8 percent, but by the year’s end, unemployment rose to 8.7 percent.
Download the full report to learn more: The American Rescue Plan Act of 2021: New York’s Share of the Coronavirus Fiscal Recovery Fund
By Shamier Settle and Jonas Shaende
Shamier Settle is a Policy Analyst and Jonas J.N. Shaende, PhD is the Chief Economist at the Fiscal Policy Institute.