The Legislative Counsel Bureau and the Governors Finance Office briefed the Interim Finance Committee on Oct. 30 about the status of American Rescue Plan Act (ARPA) state fiscal recovery funds and identified deobligations and reallocations that are being used to address increased food insecurity.

Sarah Kaufman, of the Legislative Counsel Bureau Fiscal Analysis Division, summarized the ARPA obligation table and reminded the committee that "the state did obligate 100% of the coronavirus state fiscal recovery funds by the 12/31/2024 deadline" and that any remaining funding must be expended by Dec. 31, 2026. Kaufman said the LCB table tracks program descriptions and amounts and highlights recent savings the Governors Finance Office identified for reallocation.

Curtis Palmer, deputy director of the Governors Finance Office, told the committee the ongoing federal shutdown disrupted federally funded nutrition programs and that the GFO identified and reallocated ARPA savings to the Department of Agricultures commodity distribution program. "In total, the state department of agriculture has put forward $8,600,000, which has been distributed to the Food Bank of Northern Nevada and 3 Square Food Bank in Southern Nevada," Palmer said.

How the deobligations were chosen

Tiffany Greenemeyer (GFO) said the office reviewed projects (particularly larger projects with low spending percentages), worked with agencies and subrecipients, and identified projects with savings that could be reallocated. "We started reaching out to the agencies and have them work with their subrecipients ... and let us know, can we de obligate any of these funds?" she said.

Committee members asked for more granular data. Assemblymember Brown-May asked whether the deobligated amounts came from programs such as childrens behavioral health and whether the committee could see spending by provider type. Stacy Weeks (GFO) and Anne Jensen (Nevada Health Link/Nevada Medicaid) said provider-type spending is available through Medicaid claims data but usually on a six-month lag; Jensen said federal approvals to use Medicaid for certain children's behavioral health services were coming online and that those federal dollars reduce the need for the ARPA grant funding in some program areas.

Specific program clarification

Members raised a specific example: a $1,250,000 reduction to a DCFS wraparound intensive care services award. Counselman Cannavaro (DCFS administrative services) said the programs original allocation was about $14.6 million and that the division had extended the project. Anne Jensen (Nevada Medicaid) told the committee federal approval is allowing Medicaid to cover more services and that a path exists to preserve provider-infrastructure investments while reducing reliance on the ARPA contract for direct provider payments.

Timing and next steps

Kaufman and the GFO said the table distributed to the committee lists 36 projects with identified savings totaling $7.8 million; 11 of those projects had savings under $100. LCB and GFO said the identified savings have been reallocated to food insecurity programs and that additional reallocations are possible as agencies and recipients continue to reconcile spending before ARPAs expenditure deadline. GFO and LCB staff also said a fuller fiscal year 2025 closeout report will be developed for the December IFC meeting, noting additional reconciliations were slowed in part by a late summer cybersecurity incident.

Ending

Committee members asked the GFO and LCB to prepare provider-type spending breakdowns where feasible, to include clear schedules of affected projects, and to indicate which changes maintain program operations vs. which represent permanent reductions. The GFO said the emergency reallocations were used to move dollars quickly to food insecurity programs while the agencies and LCB compile fuller reports for December.