With passage of the federal Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”), Oregon received over $1.6 billion through the Coronavirus Relief Fund (“CRF”). A portion of these CRF funds are intended to reimburse local governments for COVID-19 related expenses. The federal government already sent $246.8 million directly to jurisdictions with populations over 500,000: Washington County, Multnomah County, and the City of Portland. For cities, counties, and special districts which did not receive CRF funds directly from the federal government the Oregon Legislature committed $400 million of Oregon’s CRF funds to support local governments.
Municipalities may use the CRF funds to cover previously unbudgeted necessary expenditures incurred due to COVID-19 public health emergency. Specifically, CRF funds may be used for expenditures incurred (1) due to the COVID–19 public health emergency, (2) between March 1, 2020 – December 30, 2020, and (3) which were not accounted for in the most recently approved budget.
1. Expenditures are incurred “due to” COVID-19 when expenditures are used for action taken to respond to COVID-19. These expenditures must also be ‘’necessary.”
2. Expenditures must be incurred between March 1, 2020 – December 30, 2020. Goods or services must be ordered by December 30, 2020 but do not necessarily have to be used by December 30, 2020. For example, if a county provides money to a nonprofit to distribute to individuals for rent assistance, the nonprofit must distribute the money no later than December 30, 2020.
3. Funds may only be used for expenditures that were not accounted for in the most recently approved budget as of March 27, 2020. An expenditure meets this requirement if either (1) the expenditure cannot be funded using a line item or allocation within the budget, or (2) the expenditure is for a substantially different use from the expected use of a budgeted item.
Perhaps one of the most exciting opportunities for use of the CRF funds is for economic development to support small businesses. For example, a small business may be eligible for grant money. In addition to economic support, CRF funds can be used by local governments for many other expenditures including: utility assistance, nonprofits, support for individuals and families, unemployment, medical expenses, public health expenses, COVID-19 compliance, city action taken to respond to the COVID-19 emergency, or any other COVID-19 related expense reasonably necessary for municipal operations. For example, CRF funds can be used to cover designated law enforcement for COVID-19 compliance or a temporary COVID-19 testing facility.
Of course, there are prohibited expenditures and we would be remiss if we did not flag the prohibition on using CRF funds to cover shortfalls in government revenue. If your local government, special district, or business would like assistance interpreting allowed expenditures or more information regarding the CRF funds please contact BLJ’s municipal attorneys, Jeremy Green, Alan Dale, and Meagan Masten.
Article by Meagan Masten and Jeremy Green.