Fiscal Federalism, ARPA, and the Politics of Repair.

This article examines the American Rescue Plan Act (ARPA) as a significant federal response aimed at repairing the fractured U.S. fiscal federalism exposed by the COVID-19 pandemic. It highlights how ARPA, under the Biden Administration, provided unprecedented direct federal aid to local governments—larger, longer-term, and more flexible than previous programs like the American Recovery and Reinvestment Act (ARRA)—enabling localities to address structural inequities and invest in infrastructure, social services, and equity-focused initiatives. The analysis shows that prior to ARPA, local governments faced a "tightening vice" of declining state aid, restricted revenue-raising authority, and limited policy autonomy due to state preemptions, which constrained their fiscal capacity and innovation. While ARPA’s infusion of funds represents a "politics of repair" fostering more cooperative federal-local relations, the article notes that this policy window may be temporary, with ongoing challenges from partisan politics and state resistance potentially limiting long-term transformation of American federalism.