Statewide and in the Pikes Peak region, all federal funds received through the American Rescue Plan Act of 2021 were earmarked for use by the U.S. Treasury Department’s deadline of Dec. 31, 2024, officials say.

However, recipients have until the end of 2026 to spend the COVID-19-era economic support and stimulus money.

Nearly $2 trillion was allocated nationwide through the pandemic-driven funding mechanism known as ARPA, which included a $350 billion pot called Coronavirus State and Local Fiscal Recovery Funds.

Those dollars were distributed to states, cities, counties, tribal governments and territories to “remedy the mismatch” between rising costs and falling revenues in communities and support the “response to and recovery from the COVID-19 public health emergency,” according to the Treasury.

The state of Colorado obligated its $3.8 billion of ARPA funding, with nothing remaining unassigned for use, according to the Department of Personnel and Administration in the Office of the State Controller.

The General Assembly approved 75 bills in six major spending categories: economic recovery and relief; workers, employers, and workforce centers; behavioral and mental health; affordable housing and homeownership; revenue loss restoration (allocated for general government services); and transportation.

El Paso County’s share of $139.9 million and Colorado Springs’ disbursement of $76.04 million also have been designated for various purposes, as laid out in a more than 300-page federal plan that set guidelines and parameters for how the money could be spent.

Under the act, funds that were not “obligated” for qualifying projects by Dec. 31 must be returned to the Treasury.

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From improvements to water, wastewater and storm-water systems to creating a new neighborhood center and upgrading irrigation systems at Colorado Springs municipal golf courses, officials say the projects would not have come to fruition without their cut of ARPA funds.

“We really wanted to focus on things that we could create the biggest impact and maybe things we had not been able to fund previously but knew we needed to fund,” said Charae McDaniel, chief financial officer for Colorado Springs.

The city divided its chunk among public safety, infrastructure, economic vitality and community interaction projects.

“We had conversations with the administration and City Council and our departments to identify the highest-priority needs at the time,” McDaniel said. “We made sure our projects complied with eligible uses for the funds and the specifications.”

While some federal monies doled out covered expenses related to the virus itself — such as COVID testing stations, equipment, immunizations and hospital costs, or to help businesses pay employees’ salaries with forgivable loans — ARPA had broader application to revitalize economies.

“This was a shot in the arm to move priorities forward,” McDaniel said. “In addition to the city taxpayer funds we put into these priority areas, we had this infusion that allows us to take bigger steps for public safety, infrastructure and vitality.”

For example, a large storm-water improvement project on North Nevada Avenue between Fillmore Street and Garden of the Gods Road is moving forward.

“The lack of infrastructure there was prohibitive to development because it’s such a costly project; it’ll allow development there to be feasible,” McDaniel said.

The city’s old Senior Center in Golf Acres has been demolished, and a new one is on track to open in August, she said. ARPA supplied $10 million toward the project.

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“The Senior Center previously stood up in an old grocery store; it was not the best design for the activity that was occurring there,” McDaniel said. “The new city-owned center is being built specifically for and with the senior community in mind.”

ARPA funding of $2.47 million paid for a feasibility study on a proposed new use for the City Auditorium. The downtown Colorado Springs event venue closed in 2023, after a nonprofit that was raising funds to renovate the historic building fell short of targets and said it could not continue.

Design work for improvements and needed infrastructure upgrades were included in the new proposed direction, McDaniel said.

However, “At this point, additional money to move forward was not able to be identified, so we’re not able to move forward with the project,” she said.

El Paso County separated its ARPA awards into categories of water, wastewater and storm-water infrastructure, regional business relief, community impact, chambers of commerce and tourism and hospitality.

The county funded 727 projects, ranging from extending broadband reach for internet access for school children to aiding delayed construction projects, building mental health resiliency and supporting free food distributions.

There were more upgrades that would have qualified than there was money available, said Amanda Grant, El Paso County’s deputy chief financial officer.

The tricky part was “finding the right fit,” to match projects that would suit the community needs to available dollars, she said.

“El Paso County did a good job of getting our money obligated and making sure we used these funds in a responsible way and not for ongoing costs that would result in a budget shortfall.”

Some ARPA recipients are facing repercussions for applying the money to long-term needs that require additional funding to complete, she said she realized after attending a conference titled, “Falling Off the Fiscal Cliff.”

Legislators used one-time ARPA funds to help balance the state’s 2024-25 budget and are considering doing the same for the upcoming fiscal year as Colorado faces a $1 billion budget deficit. 

Members of the legislature’s Joint Budget Committee said last month that one-time funds don’t really help solve the state’s structural budget deficit — which happens when ongoing revenues fail to cover ongoing spending. But that money can help the state “in transitioning to a lower level of ongoing spending,” according to a Feb. 3 article in Colorado Politics. 

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El Paso County’s single largest infrastructure grant of $4 million was awarded to The Loop for engineering and financial planning. The pipeline, estimated to cost $165 million-$250 million, is part of the proposed Northern Water Delivery System and will treat and recycle water from the Denver Basin to benefit water users in northern El Paso County beginning this summer.

Ramah is realizing a necessary large-scale project. The $2 million in ARPA funds that the town of 120 residents received covered half of a $4 million upgrade to its wastewater system — “a project the community never would have been able to afford,” Grant said.

Town Clerk Cindy Tompkins agrees.

The old lagoon system will be retired when a new sewer-style wastewater plant opens at the end of summer, she said.

“The old one we have we’re using is in a flood plain. We knew we’d have to upgrade eventually.”

The town had to increase rates for customers which Tompkins, who lives in Ramah, said is reasonable.

“We couldn’t have done it without the ARPA funds from the county,” she said. The state’s Department of Local Affairs and the Colorado Water Resources and Power Development Authority also contributed grants.

Local nonprofits got assistance with requests such as building the Family Success Center. The project of Pikes Peak United Way and Harrison School District 2 repurposed a shuttered elementary school into a community hub to provide stability for families living in the historically low-income southeast neighborhood.

The county awarded $1.2 million in ARPA funding, while the city provided $1.5 million, which helped get the project off the ground, said Cami Bremer, president and CEO of Pikes Peak United Way.

A former county commissioner who served from 2018 to 2024, when she stepped down to take the lead at United Way, Bremer said county leaders selected projects “with the vision and knowledge that the ARPA funding needed to be a community investment — something that would have lasting benefits for the community.”

The center has achieved that goal, she believes. More than 22,000 people visited the Family Success Center at 1520 Verde Drive last year, Bremer said, to take adult classes on budgeting and finances, resume writing, job searching and computer literacy. Activities for children, such as after-school basketball, and fulfilling basic needs such as a food pantry and assistance with signing up for public aid also are available.

Early on, the conservative-leaning county commissioners debated whether to take ARPA funding, given the climbing national debt, Bremer said.

“In some communities there was a resistance to accepting it, in other communities there was a realization we could either accept it and do wonderful visionary things with it — or we could lose out on that and watch communities around us spend it,” she said.

“In southern Colorado and El Paso County, you saw a real attempt to find out where we were in that post-COVID world and where we could be with a little help in getting over the hump.”