3 Essential Policies To Avoid An ARPA Audit

All municipalities that have received American Rescue Plan Act (ARPA) funds must have three policies to be in compliance with their grant award. Our team has heard from auditors that they will be looking for proof of the following policies on record with the municipality:

• Procurement
• Allowable Costs
• Cash Management

These three policies must be in written form and meet the guidelines described under the Uniform Guidance rule.

Although these policies are not uploaded into the Department of the Treasury Portal, the Department can request proof at any time during the grant award term. If a municipality does not have these policies in place, or written policies do not meet the Uniform Guidance requirements, the Department can issue an audit finding. An audit finding can result in a myriad of consequences. Consequences can range from a written warning with an action plan to the re-payment of grant funds to the Department.

We encourage Municipalities to adopt or review their existing policies surrounding procurement, allowable costs, and cash management to ensure that they meet ARPA requirements and the Uniform Guidance guidelines. If you have questions about what this means for your municipality, reach out to Amanda Methot or visit Bernstein Shur’s Municipal Practice Group web page.