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REQUEST FOR COUNCIL ACTION <br /> Date:January 24, 2022 <br />Item No.:7.e <br />Department Approval City Manager Approval <br /> <br />Item Description:Update and discussion ontheCoronavirus Local Fiscal Recovery Funds <br />established under the American Rescue Plan Act (ARPA) and approval of the <br />proposed spending plan. <br />1 B ACKGROUND <br />2 Congress adopted the American Rescue Plan Act in March 2021 (“ARPA”) which included $65 billion <br />3 in recovery funds for cities across the country. The US Treasury provided guidelines for each city to <br />4 follow while thinking about ways to use the funds. <br />5 <br />6 The City Council approved application and acceptance of the ARPA funds on June 21, 2021. The City <br />7 received its first half distribution of ARPA funds on July 27, 2021 in the amount of $1,928,885.58. An <br />8 additional distribution of $63,165.69 was received on November 29, 2021. The City will receive the <br />9 balance of the ARPA funds ($1,992,051.27) in the second half of 2022 for a total award of $3,984,102.54. <br />10 <br />11 Unlike the funds through the CARES Act which had a short time frame for spending the federal dollars, <br />12 the ARPA funds are available for appropriation through December 31, 2024. The Council approved some <br />13 uses of these funds in the 2022 budget and through certain union contract approvals. <br />14 <br />15 The Final Rule has been issued by the U.S. Department of the Treasury, and the general categories of <br />16 eligible use of these ARPA funds are as follows: <br />17 1. Replacement of lost public sector revenues <br />18 2. Responding to the Public Health Emergency/Negative Economic Impacts <br />19 3. Infrastructure investments – water, sewer and broadband projects <br />20 4. Premium Pay for essential workers. <br />21 <br />22 A key change in the Final Rule addresses the use of ARPA funds for revenue losses. This change allows <br />23 an option allows recipients the option to claim a “flat standard allowance” for revenue losses (up to $10 <br />24 million). Funds can then be used for “general government services”. This change is intended to provide <br />25 more streamlined reporting and tracking in the uses of funds. Recipients must choose either to calculate <br />26 revenue losses each year through 2024 or select the standard allowance. Once an option has been <br />27 selected, it cannot be changed over the life of the ARPA program. Staff recommends selecting the Flat <br />28 Standard Allowance option for ease in reporting. <br />29 <br />30 Staff has been discussing how to best implement these funds over the past few months and the City <br />31 Council has already approved some of these items. The following chart contains the City Manager and <br />32 Staff recommendations. <br />Page 1 of 3 <br /> <br />