Where is the federal relief for Vermont municipalities?

In March, the American Rescue Plan Act allotted nearly $200 million of relief to Vermont’s local governments—$76.6 million to cities and towns, and another $121 million to Vermont counties—to respond to the COVID health emergency, boost essential worker pay, provide needed government services, and invest in water, sewer, or broadband infrastructure. This money will have significant impact, as it is nearly 40 percent of what Vermont local governments collected in municipal taxes in 2020.

But where is that federal relief money?

Vermont cities and towns with fewer than 50,000 residents could see their money before the end of August. All but one Vermont municipalities had applied to the state as of July 21 for their funds, and the state requested the money from the federal government last week. Once Vermont gets the money, the federal Treasury requires towns get it within 30 days, unless the state requests an extension.

It’s less clear when the county funds will arrive though, or even who will receive them.

While some counties in the U.S. take on a lot of responsibility, including administering health and welfare services, and funding schools and roads, Vermont county governments do less, running the county courts and sheriffs’ departments. So the federal formula, which calculated county funding based on population, allots relief funds to Vermont counties that is anywhere from 5 to 27 times their annual budgets. Counties don’t have the capacity or the expertise to administer these dollars.

In states without any active county government, county dollars will be directed to the state and then to local governments, according to Vermont’s Joint Fiscal Office. Given Vermont’s limited county government, this seems to make the most sense for Vermont too. But the Treasury has yet to approve an alternate plan for Vermont’s county money.

And so we wait. While it’s not clear when a decision will be made, one certainty is that after a very difficult 16 months, Vermont cities and towns could use those dollars now to rebuild and support their communities.