On March 27, 2020, President Trump signed the CARES Act into law. Within the CARES Act, Congress provided for direct funding to local governments. However, such direct funding was limited to a unit of local government with a population that exceeds 500,000. As a result of this population threshold many local governments were not eligible for directing funding under the Act.
Federal Guidance Update
On May 4, 2020, the federal government updated its Frequently Asked Questions relating to the CARES Act to provide that a County may share the direct funding it receives under the CARES Act with cities provided that the transfer qualifies as a necessary expenditure incurred due to the public health emergency and meets the other criteria of Section 601(d) of the Social Security Act. This is an important update to the previous guidance that provided that States may share CARES Act funding with cities.