What portions of the CARES Act and American Rescue Plan were direct payments versus state/local aid and loan programs?
Executive summary
The CARES Act (March 2020) and the American Rescue Plan (ARP, March 2021) each combined large direct household payments with substantial assistance to state and local governments and major loan programs, but they differed sharply in emphasis: CARES leaned heavily on business loans and pandemic-era unemployment supports alongside a large round of individual stimulus checks, while ARP shifted more federal dollars into direct state and local fiscal relief and targeted sectoral grants even as it repeated direct stimulus checks and tax-credit expansions [1] [2] [3].
1. CARES Act: what was direct-to-people versus state/local aid and loans
The CARES Act included one big direct-to-household program — economic impact payments roughly equivalent to $1,200 per eligible adult (commonly reported as about $300 billion in total) — and expanded unemployment insurance benefits for workers [1]. At the same time, CARES set aside roughly $150 billion specifically for state and local governments through the Coronavirus Relief Fund, but a very large portion of the statute’s headline $2.2 trillion went to loan and liquidity programs for businesses and industries: proposals and allocations for Treasury loans and programs initially contemplated as much as $500 billion for industry and roughly $350 billion for small-business supports including the Paycheck Protection Program (PPP) [2] [1] [3].
2. ARP: direct payments, tax‑credit expansions, and much larger state/local aid
The American Rescue Plan delivered another round of direct stimulus checks — $1,400 per eligible person — and expanded tax credits such as the Child Tax Credit and Earned Income Tax Credit, which are effectively direct fiscal transfers to households [1] [4]. Critically, ARP allocated a far larger, dedicated pot for state and local governments: roughly $350 billion in State and Local Fiscal Recovery Funds compared with CARES’s $150 billion for the Coronavirus Relief Fund [2] [5]. ARP also included substantial targeted grants and sectoral investments — for example, about $39 billion for child-care stabilization and other sector relief and roughly $60 billion for counties plus additional municipal and capital project funding — shifting the package’s center of gravity toward public services and recovery investments [6] [7] [8].
3. Headline contrasts: loans versus fiscal relief
In short figures emphasized by contemporaneous reporting, CARES displayed a heavier reliance on loan and credit programs for businesses (PPP and Treasury lending) alongside large unemployment and one-time checks, while ARP emphasized recurring or structural relief to households (expanded credits and another round of checks) and far greater fiscal transfers to state and local governments to blunt revenue shortfalls and fund services [1] [2] [3].
4. How much went directly to sub‑federal governments and how it was structured
The ARP’s $350 billion for state and local governments was distributed through the Treasury’s State and Local Fiscal Recovery Funds with tranches and eligibility rules and included set allocations to counties and cities (national associations noted $65.1 billion in county-directed aid in one breakdown, and Congressional summaries show the Treasury-directed allocation mechanics) [9] [10]. CARES’s $150 billion in the CRF was an earlier, smaller pool disbursed in 2020 with different eligible uses and timeframes [11] [2].
5. Competing narratives and implicit agendas
Public debate often reduces these massive bills to the visible drama of “stimulus checks” — an attention-grabbing piece but not the whole story: billions flowed as loans, sectoral grants, and intergovernmental fiscal relief that changed the fiscal posture of states, counties, cities, schools, transit and child-care systems [1] [6] [2]. Advocacy groups and municipal associations pushed for larger direct state/local pots in ARP, arguing CARES’s CRF was too small and too narrowly administered; that political pressure shaped ARP’s composition and explains why ARP’s state/local bucket was far larger [9] [2].
6. Limits of available reporting and final assessment
Existing summaries in the provided reporting document the key aggregates — CARES roughly $2.2 trillion with major components including ~ $300B in direct checks, ~$150B to state/local, and large loan/PPP totals; ARP roughly $1.9 trillion with ~$350B for state/local, another round of ~$1,400 checks plus expanded tax‑credit transfers, and targeted sector funding like $39B for child care — but a complete line-item reallocation across every subprogram would require granular accounting across hundreds of appropriations and OMB/Treasury reports beyond these sources [1] [2] [6].