The second category of use under the Coronavirus State and Local Fiscal Recovery Funds Program (SLFRF) is to “Support the COVID-19 Public Health and Economic Response.” The Department of the Treasury intends this category of funding to be used to “meet the public health and economic needs of those impacted by the pandemic in their communities, as well as address longstanding health and economic disparities, which amplified the impact of the pandemic in disproportionately impacted communities, resulting in more severe pandemic impacts.”  

This category of SLFRF can further be split into two categories—public health impacts and negative economic impacts. Public health impacts should be focused on mitigating the impacts to public health by the COVID-19 pandemic and responding to the public health emergency. Described routes include: 

• COVID-19 mitigation and prevention 
• Medical expenses 
• Behavioral health care 
• Preventing and responding to violence 

Parties applying for funding under the category of public health impacts can find more posts about accessing funds under each of these categories here.  

Applicants seeking funding in response to the negative economic impacts of the COVID-19 pandemic should focus their efforts on the following classes, which can be applied to individuals or groups within each class: 

• Households and communities, Impacted & Disproportionately impacted 
• Small businesses, Impacted & Disproportionately impacted 
• Nonprofits, Impacted & Disproportionately impacted 
• Industries, Impacted & Disproportionately impacted 
• Public sector capacity 

Within the first four categories as detailed above, recipients of SLFRF funding should demonstrate the level of impact on the affected individuals or class. The Final Rule of the SLFRF distinguishes between “impacted communities” and “disproportionately impacted” communities. The former refers to those classes who suffered due to the pandemic, while the latter refers to those who suffered an inordinate amount from the pandemic, due to pre-existing disadvantage. For help on determining if an impact is disproportionate or not according to SLFRF, click here. Possible applicants for funding under the category of negative economic impacts can find more posts about accessing funds under each of these categories here. 

Regardless of the class of recipient, the SLFRF describes a two-step method to determine whether a use of funding would be eligible under this category: 

1. Identify a COVID-19 public health or economic impact on an individual or group 
2. Design a program that responds appropriately to said impact 

One would identify an impacted or disproportionately impacted class per the guidelines above. Programs responding to impacts on communities and their members can include programs, services, and capital expenditure. Regardless of which path a recipient chooses to follow, the response to the impact of COVID-19 should be both related to said impact and reasonably proportional to the harm suffered. Moreover, the response should be reasonably designed to benefit the impacted community.