March 24, 2021
Central Mass. communities in line for $488M from American Rescue Plan
Photo | Grant Welker
Worcester City Hall
By Grant Welker
The federal American Rescue Plan is expected to provide $488 million in aid for Central Massachusetts cities and towns to help them recover from the coronavirus pandemic and the economic toll it brought.
The Massachusetts Municipal Association has estimated more than $3 billion in aid will be provided to each of the state's 351 communities, which have seen cratering sales tax revenue and in many cases have spent municipal funds aiding those affected by the pandemic.
The biggest recipients locally include $151 million for Worcester, $33 million for Fitchburg, $30 million for Framingham and $20 million for Leominster.
The funds can be used to replace revenue lost because of the pandemic, or funding pandemic-related costs, according to the Massachusetts Municipal Association, a group representing cities and towns statewide. Communities can also use the money to invest in economic recovery or fund water, sewer or broadband infrastructure. The money will be given in annual increments this year and next year, and will be available for use through 2024.
"While the need for services has increased — including setting up emergency medical facilities, standing up vaccination sites, and supporting struggling small businesses — state and local revenues have plummeted as a result of the economic fallout from the crisis," the U.S. Treasury Department says in guidance on the American Rescue Plan. The federal aid, the Treasury said, will help municipalities cover those costs while also making longer-term investments.
[Related: Restaurant revenue plunged 33% during six months of the pandemic]
Funds are being distributed largely on a per-capita basis, but not quite. Cities and towns with more than 50,000 residents will receive funding through a modified formula used by the U.S. Department of Housing and Urban Development's Community Development Block Grant. Others will receive funds on a per-capita basis, which doesn't factor in how badly a community might have suffered because of the pandemic.
In some cases, Massachusetts counties that retain some county government operations — most, including Middlesex and Worcester counties, don't — will receive funds directly to distribute on a per-capita basis to cities and towns.
The $1.8-trillion American Rescue Plan was signed into law by President Joe Biden on March 11. The plan includes $350 billion for state and local governments, $242 billion in direct aid to families, $10 billion for homeowner assistance, and $10 billion for broadband infrastructure.
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