Complex ARPA reporting calls for streamlined, centralized solutions

Local government workers operate under a microscope as residents are demanding more accountability and transparency, while trust in government is at an all-time low. Last May, when the Treasury Department issued its Interim Final Rule on the American Rescue Plan Act (ARPA), governments were given the opportunity and resources to prioritize community engagement, accountability and transparency.

ARPA grants have been an incredible asset, providing cities and counties with billions of dollars of federal investment to support the needs of their communities as they emerge from the pandemic. As a result, local governments have been able to provide essential services, make infrastructure improvements, execute digital transformation initiatives and much more.

However, ARPA places an emphasis not just on progress, but demonstrable progress.

According to the Final Rule, local governments that receive ARPA funding are responsible for tracking how all federal dollars are spent, and then reporting the details on a quarterly and annual basis. They must publish these reports, and their progress, on a public website to provide constituents with maximum transparency.

Starting Jan. 31, 2022, cities and counties receiving ARPA funding submit a quarterly project and expenditure report that includes financial data, contract information and details of funded projects, among other materials. In addition, cities and counties with a population of over 250,000 are required to produce an annual recovery plan performance report that provides information on how they plan to ensure program outcomes are achieved in an effective and equitable manner, as well as providing key performance indicators towards those outcomes. This reporting period, which continues through to 2027, ensures that regular analysis and reporting are critical to effectively utilizing ARPA funding.

Yet, the complexities surrounding when and what to report can be daunting. Even after factoring in all internal and stakeholder information and making every effort to keep up with reporting requirements, there’s still a significant margin for error. Plus, with monetary penalties for non-compliance, the stakes are high for government workers trying to follow the rules. Further exacerbating the situation is the reality that simply aggregating the required data can be a significant burden for overworked government personnel, diverting attention away from other critical initiatives.

In Georgia, one county's experience can serve as an example both of the current challenges in ARPA reporting and in the innovative ways many local governments are overcoming them.

Clayton County, home to close to 300,000 residents, is required to provide comprehensive quarterly and annual reports to the federal government on top of their existing responsibilities.  After receiving $66M in ARPA funding, Clayton County was charged with a new set of requirements.

They aren’t alone. The reporting requirements for ARPA funding were created to increase transparency and provide relevant stakeholder groups with detailed information about where and how monies are being spent. However, the process of aggregating data from disparate sources presented the county with new challenges around user error, incomplete information and out-of-date reports.

To overcome these challenges, the county’s Office of Performance Management took an innovative approach to managing their ARPA data by streamlining it into a centralized platform for strategic planning and analytics. Using the expenditure categories supplied by the Treasury as structure, the OPM team created a dedicated plan to track the projects, outcomes, financial data and performance metrics associated with ARPA funding. Each element of the plan has its own measures associated with it to track progress, spending and success.

This approach has eliminated the time-intensive elements of reporting, with responsibility for tracking and sharing the correct metrics shared across departments. Individual staff members are responsible for uploading the correct data for the projects and measures they own before it is automatically transformed into visualizations for easy analysis and sharing with internal and external stakeholders.

As a result, the Clayton County team can capture and report on relevant data at any time. The OPM team sets the cadence for when updates are due, and staff are sent automated reminders so they don’t miss a deadline. As ARPA projects, performance measures and related expenditures are updated, OPM staff can seamlessly submit reports to Treasury’s online portal in the structure required by the federal government.

And while the push to improve the digital infrastructure of local governments isn’t new, the reporting requirements that come with ARPA funding has encouraged many of these institutions to use this opportunity to finally upgrade their data solutions.

Producing regular reports isn’t the only requirement that comes with receiving ARPA funding --  local governments must also make their projects and performance measures available on a “public facing website.” Clayton County is addressing this requirement and building trust with their residents by developing and deploying a web-based reporting system that communicates objectives, performance measures, expenditures and progress toward expected outcomes, to be made available in online reports and on a public-facing community dashboard. With all spending and performance data assembled in one environment, county officials can create and publish customized reports and dashboards with information that is relevant to their constituents.

Using data to establish resident trust in government 

A recent Deloitte survey found only 26% of respondents rated their local governments as trustworthy, and only 18% for the federal government. This lack of trust and obvious call for accountability are a great indication of why transparency has been so fundamental to the American Rescue Plan.

Many local governments already recognize the need for greater clarity in their methods and motives. Those that have made transparency a priority have realized tremendous benefits from greater communication with constituents, such as enhanced community trust and a greater capacity to act decisively on issues such as policy-making, budgeting and strategic initiatives.

Sharing a public dashboard is not only about meeting the standards for federal reporting requirements. For governments like Clayton County, it’s about creating community resources that provide valuable insight into progress toward locally established goals – for them, delivering on what they promised is an exercise in building trust. Clayton County residents can easily see progress against strategic goals or data on specific programs and witness community growth in real-time.

Today, local governments nationwide are questioning how they can balance the benefits of ARPA funding with the burdens of a complex reporting process.

The answer is in their data.

As Clayton County and other forward-looking governments begin to consolidate all information within one central digitized platform, they are also proactively supporting reporting requirements and avoiding unnecessary penalties. Just as importantly, they are establishing trust among residents, while demonstrating innovation and accelerating progress.