May 27, 2021

Tech Funding Sources For Local Governments

City and county governments rely on tax revenue, including sales tax, to operate programs and services for the local community. So when tax revenue takes a hit due to sharp declines in consumer spending—as it has during the COVID-19 pandemic—local governments will suffer.

To address the impact of the pandemic on local government revenue, recent government stimulus packages have provided much-needed aid. Although some funding sources are meant for specific purposes, such as education and public programs, there is room to use the funding to enhance your workforce management capability and help your local government run more smoothly.

Local Government Funding Challenges

When members of the community spend less on dining and retail, the local government is often the first to feel it. Quarantine and lockdown orders during the pandemic created a sizable budget shortfall for many city and county governments, leading them to make tough decisions, such as:

  • Hiring freezes
  • Furloughs and layoffs
  • Disruptions to local public services for health, housing, education and more

When local governments run low on cash, it’s not just government offices that are impacted. According to a Council on Foreign Relations report, local governments provide 45 percent of the funding for K-12 schools. So when local governments face budget shortfalls, local schools do too.

Thankfully, recent stimulus packages have provided much-needed support for cities, counties and other entities that rely on local government funding. Through these new funding sources, it is possible to meet your budget obligations and invest in technology solutions to enable more efficient operations.

Tech Funding Sources For Local Governments

Whether you need a safe return to on-site operations or better solutions for employee time-tracking and scheduling, now is a good time to earmark some stimulus dollars to support your operational and workforce management goals. Here are some of the available funding options:

Coronavirus Aid, Relief and Economic Security (CARES) Act
As the largest-ever stimulus package in U.S. history when it was passed in March 2020, the CARES Act provided over $2 trillion to boost the U.S. economy. Of the nearly $150 billion set aside for governments to spend on their COVID-19 responses, $27.6 billion went to county and city governments.

Given the flexibility offered to governments in the use of CARES funding, some municipalities have allocated dollars to cover technology solutions. For example, one North Carolina county earmarked CARES Act funding for technology purchases that enabled more efficient remote work for employees.

American Rescue Plan Act (ARPA)
In March 2021, the $1.9 trillion American Rescue Plan Act was signed into law and provided payments to local governments through the Coronavirus Local Fiscal Recovery Fund. Through the fiscal recovery fund, $65.1 billion was allocated to counties, and $45.6 billion was allocated to cities with a population over 50,000. Local governments can use ARPA funds for a range of projects and investments, including public health initiatives, support for essential workers and technology infrastructure. Similar to the CARES Act, local governments have some leeway in determining how to use ARPA funds. As the U.S. Treasury explains, “[ARPA fund] recipients have broad flexibility to decide how best to use this funding to meet the needs of their communities.”

It is also worth noting that a few months before ARPA was passed, another stimulus bill was signed into law—the Coronavirus Response and Relief Supplemental Appropriations Act (CRRSAA). Although this stimulus package did not directly provide funds for local governments, it did provide funding to support K-12 schools. Thus, the CRRSAA indirectly supported local governments by funding schools that would otherwise be looking to local governments for additional support.

Other Federal Grants
One-off stimulus packages aren’t the only source of funding available to city and county governments. The federal government regularly disburses grant funding, and distributed $721 billion to state and local governments in 2019. Though grants are typically targeted for use in specific areas, some can be used to support purchases of technology for better business and workforce management. Check for a list of thousands of available grants for city and county governments.

Boost the Effectiveness of Your Government Operations

Although the pandemic has likely dealt a blow to your local government’s budget, recent stimulus packages can soften the impact. With these new sources of funding, you can invest in technology that can help you manage your government operations more effectively. To learn more, explore TCPs workforce management technology solutions to find the best fit for your local government operations.