The American Rescue Plan Act: State Recovery Plans Outline Intent to Support Workers with Disabilities

By Rachel Wright, Policy Analyst

In March 2021, Congress passed, and President Biden signed, the American Rescue Plan Act (ARPA). The $1.9 trillion package is intended to combat the economic and social impacts of the COVID-19 pandemic. ARPA established the State Fiscal Recovery Fund (SFRF), allocating $195.3 billion to the states, District of Columbia and U.S. territories for COVID-19 relief and recovery. SFRF funds are intended to support government programs that respond to the COVID-19 public health emergency and its negative economic impacts.

The State Fiscal Recovery Fund: Planning and Allocation

People with disabilities have disproportionately experienced the negative economic impacts of COVID-19 due to the strain the pandemic has placed on employment opportunities.

For example, many workers with disabilities have medical statuses that put them at risk for severe outcomes from COVID-19 infection, thus straining their ability to remain at work. Workers with disabilities were also faced with restricted public transportation routes and hours, making it difficult for them to arrive at work.

Workforce development programs intended to support these workers have also faced pandemic-related hardship. In 2020 alone, vocational rehabilitation programs providing employment supports services to people with disabilities were required to return $141 million in funding to the federal government due to an inability to meet matching requirements. As such, utilization of SFRF funds to support programs that address the challenges faced by workers with disabilities not only complies with federal guidelines but presents an opportunity for states to craft inclusive economic recovery policies.

State policymakers remain at different stages of the planning and approval process for utilization of SFRF funds. States such as Minnesota and Nevada have received approval to utilize SFRF funds to bolster disability-owned businesses and programs that facilitate workforce transitions among individuals with disabilities. States such as New Jersey and Vermont have submitted Recovery Plans[1], but have yet to receive formal approval for fund allocation.

As of January 2022, all 50 states have submitted recovery plans to the U.S. Treasury. An analysis of these plans provides valuable insight into the ways states are seeking to craft inclusive economic recovery policies. Of the submitted plans, only four states have outlined their intent to devote funds to programs that directly support workers with disabilities. Supported programs include those that provide job training or coaching to students with disabilities, and state Developmental Disability Services agencies that help improve employment outcomes of people with disabilities.

Plans for State Fiscal Recovery Funds: Employment Supports for People with Disabilities

According to the New Jersey 2021 Recovery Plan Performance Report, a portion of SFRF funds will be utilized to address the disproportionate impact of COVID-19 on people with disabilities. Funds will support additional or compensatory education and related services for students with disabilities who have exceeded or will exceed the current age of eligibility for special education or related services. Programs with this purpose provide students with “critical adult-living skills, job training or coaching, and other crucial independent-living skills,” which can lead to improved employment outcomes.

As detailed in the Maryland Recovery Plan Performance Report, the state will invest $5 million in Developmental Disability Providers (DDPs) throughout fiscal years 2021 and 2022 to assist with costs incurred from pandemic-related reopening, transformation and revenue loss. In Maryland, the Developmental Disabilities Administration partners with DDPs to offer employment support and career coaching to clients, empowering them to live independent and fulfilling lives.

In Vermont, $4 million in SFRF funds will support the establishment of the Expanded Capacity and Accessibility for Mental Health Services and Facilities Program. According to the state’s Recovery Plan, funds will be used to make existing housing and community-based facilities providing Developmental Disability Services (DDS) more accessible and compliant with the Americans with Disabilities Act. Wrap-around services[2] provided by these facilities help ensure people with disabilities have the critical skills and support to find and maintain employment. In Vermont, the DDS Division oversees the state’s Supported Employment Program, Post-Secondary Education Initiative and the Vocational Grant Program.

Despite the completion of state recovery plans, funds set aside for specific uses may still need to be formally appropriated or otherwise approved before they can be disbursed. Furthermore, even funds formally appropriated are subject to change. To keep up to date with these potential changes, please visit The Council of State Governments State Recovery Resource Center.

[1] State Recovery Plans are required by the U.S. Department of the Treasury and are expected to detail the goals of SFRF fund utilization and how programs will achieve these goals in an effective, efficient and equitable manner.

[2] Wrap-around service delivery is a collaborative case management approach used to describe a program that is flexible, family or person-oriented and comprehensive.