Flexible Aid in an Uncertain World: The Coronavirus State and Local Fiscal Recovery Funds Program

Abstract

Emergency fiscal transfers to state, local, tribal, and territorial governments have been at the core of the U.S. federal government's response to the COVID-19 pandemic. The most extensive of these transfer programs is the Coronavirus State and Local Fiscal Recovery Funds (CSLFRF) program, contained in the American Rescue Plan Act of 2021. The CSLFRF is not only larger than prior rounds of emergency aid, it was also designed to address a broader series of crises, address pre-existing inequities, and provide greater discretion to public officials in deciding how to allocate funds. In this article, we consider the extent to which this program represents a departure from what some have called “fend for yourself” federalism. We conclude that while the coordinated effort of intergovernmental organizations resulted in a greater measure of federal fiscal activism and flexibility than might have been anticipated, lingering political conflicts and legacies of austerity will continue to inflect the CSLFRF's implementation.