Significant Updates to Coronavirus Relief Fund Guidance and FAQs

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Significant Updates to Coronavirus Relief Fund Guidance and FAQs

September 3, 2020

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Significant Updates to Coronavirus Relief Fund Guidance and FAQs

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On September 2, 2020, the U.S. Department of the Treasury released updated Coronavirus Relief Fund Guidance for State, Territorial, Local, and Tribal Governments and Coronavirus Relief Fund Frequently Asked Questions. These updates are significant because of the additional flexibilities they afford Indian Tribal Governments.

The Coronavirus Relief Fund Frequently Asked Questions provides the ability to fund critical public infrastructure projects such as providing access to clean water for Indian Country among other flexibilities. 
 

Resources

NAFOA has provided a brief update of key changes below and additional information about the Coronavirus Relief Fund (CRF) is available at Treasury's CARES website.

Coronavirus Relief Fund Guidance for State, Territorial, Local, and Tribal Governments (CRF Guidance)
 

This is the most substantive change to the CRF Guidance since June 30, 2020. The September 2, 2020 version of the CRF Guidance additions start on page 5 and added two sections.

Supplemental Guidance on Use of Funds to Cover Payroll and Benefits of Public Employees

This section provides an overview and review of the different types of support for public employees including those substantially dedicated to mitigating or responding to the COVID-19 public health emergency. The full amount of payroll and benefits expenses of substantially dedicated employees may be covered using CRF monies. Documentation of local determinations of substantially dedicated is recommended. This follows the updated Treasury CRF FAQs issued August 10, 2020 under Question A.2. 

The rest of this section reviews additional items related to clarification of the types of public health and public safety employees, non-substantially dedicated employees, and covered benefits.

Supplemental Guidance on Use of Funds to Cover Administrative Costs

This section provides an overview and review of the different types of administrative costs associated with the CRF. Most notably, the Treasury Department outlines Indirect Costs do not apply to CRF funds saying, "Recipients may not apply their indirect costs rates to payments received from the Fund. [emphasis added]"

In addition, the updated CRF Guidance provides administrative flexibility to use CRF monies to cover a portion of payroll and benefits of employees corresponding to time spent on administrative work necessary due to the COVID-19 public health emergency. However, time tracking cannot be done for only one or a handful of employees and must be consistent across the whole department. This is outlined in CRF FAQs Question A.47.

An Indian Tribal Government may use CRF monies to cover a, "reasonably proportionate share of the costs of audits attributable to the [CRF]." See CRF FAQs B.11.

Coronavirus Relief Fund Frequently Asked Questions (CRF FAQs)
 

The CRF FAQs were last updated on August 10, 2020. The September 2, 2020 version of the CRF FAQs amended Questions A.34 and A.38 which incorporate the additional clarifications found in the updated CRF Guidance. Questions A.53- A.56 were added to the updated CRF FAQs and concern the following topics:

Question A.53: Expenditures regarding safe reopening of schools 

Clarifies flexibilities associated with distance learning, PPE for in-person learning, or other costs associated. Schools do not need to document specific uses up to $500 per student.

Question A.54: Expenditures regarding upgrade to critical public health infrastructure 

Allows CRF Fund recipients the ability to upgrade public health infrastructure, including providing running water upgrades to communities to help reduce COVID-19 spread. However, these upgrades must be incurred by December 30, 2020.

Question A.55: Clarification on 'most recently approved' budgets

The baseline budget to be used is one that was most recently approved as of March 27, 2020. This baseline budget will be carried forward if a new budget year is entered between the covered period. Most notably, a cost is not considered to have been accounted for in a budget merely because it could be met using a budgetary stabilization fund, rainy day fund, or similar reserve account.

Question A.56: Clarification on applicability of National Environmental Policy Act, 42 U.S.C. § 4321 et seq (NEPA)

NEPA does not apply to Treasury's administration of CRF funds. However, if projects are supported from more than one federal financial assistance program(s) NEPA may apply.

For a complete understanding, NAFOA encourages each tribal government to familiarize themselves with official guidance and FAQs regularly published by the Treasury Department, here.

NAFOA Advocacy in Action
 

NAFOA advocated for increased flexibility for the use of funds including the build out of infrastructure projects that can mitigate the current health crisis and emerge better prepared.

NAFOA advocated for clarity on audit and other administrative costs that occur beyond December 30, 2020 in our June 19, 2020 letter to Secretary of the Treasury Steven Mnuchin and Acting Director of the Office of Management and Budget Russell Vought outlining our concerns and solutions with aspects of the CRF.

NAFOA advocated for Indian Tribal Governments to have the flexibility to use their approved indirect cost rate(s) for indirect costs related to CRF expenditures in the same letter. Reducing the CRF compliance burden to ensure Indian Country is effectively responding to the COVID-19 crisis remains our priority.

NAFOA understands the updated CRF Guidance may place an undue burden on Indian Tribal Governments to isolate costs associated with CRF and we urge Indian Tribal Governments to carefully review their Indirect Cost Pool and any impacts this may cause especially as it relates to employee time tracking.

For any other questions or concerns, please contact Emery Real Bird, Financial Management Policy Specialist, at Emery@nafoa.org or (202) 945-7750.
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