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Wednesday, May 13, 2020

CARES Act Recovery Assistance Grants Available to Local Governments for Economic Development

The U.S. Department of Commerce recently announced that the Department’s Economic Development Administration (“EDA”) is accepting applications from eligible grantees for $1.5 billion in CARES Act funds intended to help communities prevent, prepare for, and respond to COVID-19.

Eligible grantees include states, counties, cities or other political subdivisions of the state, including a special purpose unit of a state or local government engaged in economic or infrastructure development activities, or a consortium of political subdivisions. However, grant applicants must clearly explain how their project would “prevent, prepare for, and respond to coronavirus” or respond to “economic injury as a result of coronavirus.” See Eligibility FAQ.

The EDA will make CARES Act Recovery Assistance grants under the authority of its Economic Adjustment Assistance (“EAA”) program to support various non-construction and construction activities, including revolving loan funds, in regions across the country experiencing severe economic dislocations brought about by the pandemic. Examples of projects that EDA may fund include:
  • economic recovery planning and preparing technical assistance strategies to address economic dislocations caused by the coronavirus pandemic;
  • preparing or updating resiliency plans to respond to future pandemics;
  • implementing entrepreneurial support programs to diversify economies, and
  • constructing public works and facilities that will support economic recovery, including the deployment of broadband for purposes including supporting telehealth and remote learning for job skills.

The Congressional Research Service notes that EDA’s role in the pandemic response will likely emphasize coordinated, long-term, regional, and strategic responses to economic recovery. Short-term responses to address budget shortfalls are not likely to be competitive in the EAA program.

Grant awards will range from $100,000 to $30,000,000, and the EDA generally expects to fund between 80 to 100 percent of eligible project costs. The notice of funding opportunity indicates the EDA will accept applications on an ongoing basis, but high demand is expected for the anticipated 3,000 grant awards.

Post authored by Eugene Bolotnikov and Daniel J. Bolin


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