This report—written by Neil Ridley and Evelyn Ganzglass—examines the response of three states and local areas to the urgency of the recession, additional funding and the opportunities and challenges afforded by the American Recovery and Reinvestment Act (ARRA). The state and local experience during 2009-2010 also sheds light on various long-standing challenges that need to be addressed if the public workforce system is to move in the direction charted by ARRA.