Gov. Tate Reeves has approved a bill to retain funding that came to Mississippi from a historic federal infrastructure funding package in 2021.
As part of the American Rescue Plan Act, the federal government allocated $1.8 billion to the state in 2022. Of that pot, the state awarded $423 million in matching water and sewerage grants for cities and counties, as well as $385 million for rural water associations.
But the deadline to spend that money is sneaking up. The federal program requires that all money be spent by Dec. 31 of this year. In early February, lawmakers released a list of projects under those programs, showing millions in unspent money around the state.
As of the end of 2025, only 56% of the grants for cities and counties, handled by the Mississippi Department of Environmental Quality, had been spent while, as of Feb. 2, 69% of grants awarded to rural water associations, handled by the Mississippi State Department of Health, had been spent. In total, over $305 million from those two programs was still unspent, although that number has likely gone down since February.
House Bill 1571, which Reeves signed into law Monday, moved the Dec. 31 deadline up to make sure the state doesn’t lose any of the federal money. As soon as Sept. 30, and no later than Oct. 15, the state will redirect unspent ARPA funds to three different places: The first $100 million will go to Mississippi Department of Transportation projects. Up to $63 million would then go towards a state health and life insurance fund.
After that, any remaining money would be spent at the governor’s discretion, following federal guidelines. The state Department of Finance and Administration will have until Oct. 30 to report to the House and Senate on how much money was split between the three buckets, and how much funding, if any, remains.
Sewer pipes are replaced on Lamar Street in Jackson, Miss., July 21, 2020. Credit: Eric J. Shelton/Mississippi Today“It gives us the highest probability of the least amount of money going back to (Washington) D.C.,” said Sen. Bart Williams, a Republican from Starkville and an author of the Senate’s version of the bill. “If we hadn’t done this, I would suspect there would be several millions of dollars that would have to go back to D.C.”
He explained that some projects have come in under budget, or the local entity realized they couldn’t complete the project under the time constraints. For places with legitimate reasons for not spending all their money, such as a contracting issue, there’s a chance the Legislature could still appropriate funding back to those places, Williams told Mississippi Today in February.
Mississippi Today reached out to several cities and counties with unspent ARPA funds. Almost all said their projects were still ongoing and weren’t worried they would lose any needed grant money.
Sen. Bart Williams, a Republican from Starkville.The February list showed Harrison County, for instance, with millions in unspent funds and most of its projects at less than 50% complete. But Jaclyn Turner, the county’s head engineer, explained there’s a lag between completing a project and paying for it, which makes it look like projects are much farther behind than they are.
Before she can request a reimbursement from the state, Turner said she first has to verify the work has been done and pay the contractor on the front end.
“ That kind of sets a stage where it looks like money is not being spent as quickly as it truly is,” Turner said.
She added there’s a long initial process, too, between following procurement laws and obtaining permits. Turner said the county sidelined some projects that would have “too many hoops to jump through,” but that all of its roughly 20 open ARPA projects should be complete by the new deadline.
Other entities with large unspent amounts, including the cities of Gulfport and Jackson, also said they expected to have their projects completed by the deadline.
Mississippi Rural Water Association CEO Kirby Mayfield said he expected a few systems to have trouble spending the needed funds by the new deadline.
“There’s not going to be a bunch, but there’s going to be some that don’t make this deadline,” Mayfield said last week.
The nonprofit CEO, who supported the bill, pointed to the limited number of people who can drill water wells in the state as an obstacle in ARPA spending.
“There are so many wells in these ARPA projects,” Mayfield said. “Mississippi doesn’t have but three or four well drillers that can drill these big wells. The well drillers just aren’t going to have enough time (before the ARPA deadline).”
Local entities have until the end of August to send reimbursement requests to the state for their ARPA projects.
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