NC Pro: SFRF cash must be liquidated by Dec. 31, 2026; proposed budget would let state reallocate unspent awards

Tommy, NC Pro staff, told attendees of an NC Pro webinar that every dollar of the State and subrecipient State and Local Fiscal Recovery Funds (SFRF/SLFRF) award must be liquidated — cash paid out — by Dec. 31, 2026. "These funds have to be liquidated. Cash has to be out the door, 12/31/2026," Tommy said.

The requirement matters because the federal SLFRF program allowed states a longer obligation window but a shorter liquidation window. North Carolina obligated nearly all of its award by Dec. 31, 2024 (Tommy said the only remaining amount was "20¢" the state will return to the U.S. Treasury), but the state now has a firm liquidation deadline of Dec. 31, 2026 for all levels of subrecipients.

Tommy said the Office of State Budget and Management/NC Pro is relying on the U.S. Department of the Treasury's 2022 final rule and accompanying FAQs in interpreting the deadlines and the difference between "obligated" and "liquidated." He emphasized that liquidation means payment — not just recording an accounts payable — and that the office will work with agencies and recipients through the next 18 months to meet the deadline.

A provision in the proposed state budget, labeled as section 5.9 in the materials Tommy presented, would give NC Pro limited authority to reallocate funds among appropriated SFRF projects if certain conditions are met.…