States have received – and will continue receiving – record-setting amounts of federal funding related to COVID-19. Collectively, the aid can’t be accurately described as a narrow stream or flow. It’s more like a series of tidal waves that could overwhelm states attempting to manage it using only existing strategy, project management and compliance processes and resources.

To recap, Congress has enacted about $5.2 trillion in COVID-19 related federal funding (see chart below). Building on earlier waves of federal assistance, the American Rescue Plan Act (ARPA) includes several new streams of federal funding.

One of the most consequential ARPA funding streams is the Coronavirus State and Local Fiscal Recovery Fund (CSLRF). This fund alone represents a significant amount of federal money flowing to states and local units of government ($350 billion). It’s about five times more than the massive aid states handled following the Great Recession. Even so, without proactive efforts by states and local units of government to build capacity, the CSLRF program assumes that existing resources will be used to manage this new federal money.

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 Accenture analysis of COVID-19 funding streams.

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Since the first round of CARES Act funding started reaching states, Accenture has been on the ground helping states navigate myriad compliance and reporting requirements associated with this aid. As the waves of funding have continued to scale, it has become a significant task simply to keep track of the different revenue sources – and the changing rules and requirements associated with each.

We encourage every state to thoroughly assess existing compliance policies, processes, people and systems – in other words, overall capacity to proactively manage these funds. Navigating these tidal waves of funding represents a gargantuan task. Fortunately, CSLFRF funding can be used to cover new administrative costs associated with building structures, teams, and processes to help manage the program efficiently and effectively.

In addition to tracking and managing complex, nuanced compliance requirements, states must craft strategies for how to allocate this funding. What are the best, most transformational opportunities given the state’s needs and opportunities? And how can those investments be made in full compliance with federal requirements?

Once a state and its diverse set of stakeholders have aligned on a strategic plan for allocating the funds – and determined which processes, systems and other resources need to be added or altered – there’s the ongoing task of managing the program and all the projects that fall within it.

These challenges and opportunities are among the topics that will be explored during a panel discussion at the upcoming 2021 Annual Conference of the National Association of State Auditors, Comptrollers and Treasurers (NASACT) in San Diego. Moderated by my colleague Jenny Brodie, the panel will include representatives from multiple state federal funds teams.

If you will be joining us in San Diego, I encourage you to attend the panel discussion. In any case, let’s stay connected via LinkedIn – and stay tuned for additional blogs related to this topic.

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Kelly Rogers

Senior Manager – Public Service, North America

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