Treasury Revises Guidance for Coronavirus Relief Fund (CRF) Usage

  |   December 20, 2021

The $150 billion Coronavirus Relief Fund (CRF) was designed to help state, local, and tribal governments meet short-term needs as they coped with the ramifications of the COVID-19 outbreak. Through the CRF, governments could use the funds for:

  • Necessary expenditures incurred due to the public health emergency
  • Expenses not accounted for in budgets approved as of March 27, 2020 and
  • Expenses related to the pandemic incurred between March 1, 2020, and December 31, 2021.

But as we’ve all experienced, every business is currently dealing with supply chain disruptions and labor scarcities as a result of the pandemic. Many companies have reduced hours because they can’t hire staff, and prices for everything from construction materials, professional services, and food have increased because of shortages and delays. These disruptions are expected to continue for the foreseeable future.


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Local, state and tribal governments are not immune to these conditions as they combat the virus and respond to the needs of their constituents. The wheels of government grind slowly, too, and the contract approval process can take weeks or months, further delaying the delivery of vital goods and services.

In the face of these realities, the U.S. Department of the Treasury has revised its guidance for when governments can spend their share of the CRF. Many entities were struggling to fully spend and put equipment into service by December 31, 2021.

New guidance issued on December 14, 2021 has changed this determination. Now, the cost associated with a necessary expenditure shall be considered if the recipient has incurred the obligation by December 31, 2021. Treasury defines obligation for this purpose as an order placed for property and services and entry into contracts, subwards, and similar transactions that require payment. This new guidance is consistent with other orders for similar transactions, and general principles of accrual accounting.

The bottom line?

As long as a contract for expenses that otherwise meets the criteria for use under the CRF has been entered into by December 31, 2021, the entity has until September 30, 2022 to expend the funds received to cover those obligations.

This gives governments — whether local, state or tribal — more room to maneuver through the realities of labor and material shortages, and allow their expense and contract process to work through their systems.

Read more on Coronavirus Relief Fund – Revision to Guidance Regarding When a Cost is Considered Incurred December 14, 2021

As always, consult with your trusted REDW business advisor if you have concerns about using CRF or other Coronavirus Aid, Relief, and Economic Security (CARES) Act funding. We welcome your questions below.

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